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Beth Kulow, former dean of student services at Southwestern Community College, was named the sole subject of a special audit report compiled by Denman & Company, LLP, at the request of the school’s administration after internal controls revealed misappropriation and misuse of financial resources at the college.
During a regularly scheduled meeting Tuesday, Dr. Barb Crittenden, SWCC president, announced to the board of trustees that the special audit report was received by the school that afternoon.
“This report, if you had a chance to look at it, really lays out, initially, how the concerns regarding personal travel came to our attention,” said Crittenden.
Crittenden said “an employee” of the college had represented expenses to the administration for college purposes, when in fact, were of a personal nature.
Specific concerns arose regarding a trip Kulow took Sept. 17-22 to Columbus, Ohio.
“The stated purpose of that trip was actually for Title IX training, which is something that we send our staff to, that was to be held in Ohio. However, our internal review revealed that no Title IX training was being held on the dates of the travel,” said Crittenden.
Crittenden said, based on this finding, administrators investigated another recent trip “the employee” took to Washington, D.C., for the stated purpose of compliance with requirements of the Department of Defense.
“Our internal investigation revealed that no required face-to-face training was occurring in Washington, D.C., on the dates in question,” said Crittenden.
Based on the fact that many of the expenses were purchased with a college credit card, administrators initiated an investigation into Kulow's use of the school credit card. Crittenden said that initial review showed that several recent purchases appeared to be questioned expenses.
The findings
Denman & Company auditors reviewed purchases made by Kulow from July 1, 2015, through Oct. 3.
“During that review period, there was $15,064.48 in improper or unsupported costs that were identified in his review,” said Crittenden.
In her role as dean of student services, it was not uncommon for Kulow to purchase items on behalf of the college and her position had budget authority to initiate and approve transactions up to $5,000 without additional approval prior to payment. However, despite submitting documentation for some purchases, many were erroneously categorized, such as the purchase of a keypad garage door opener, which according to a purchase order, is for the “softball garage,” but a keypad on the softball garage door does not exist.
According to the audit report, Kulow admitted that several of the purchases were not for college purposes and included items such as a “mystical genie” costume, spa gift certificates, beach towels given to guests at her wedding reception, birthday party supplies, a Moscow Mule gift basket she gifted to a coworker, items donated to fundraisers at a parochial school, and miscellaneous food items, cleaning supplies and toys.
Additionally, non-college travel expenses included, but are not limited to, a three-night hotel stay, movies and room service in Minneapolis, Minnesota from July 5 to 8; hotel expenses incurred for rooms at two different hotels on the same night during a trip from Nashville, Tennessee, to Columbus, Ohio, on June 3; the cost of a second flight and an additional night’s hotel stay after she extended her stay in North Carolina until July 20, despite having a flight home on July 19.
“We did question that employee about that information and the employee at that point admitted that the two trips and several of the questioned purchases were personal in nature and not for college purposes,” said Crittenden.
Wrongs ‘rectified,’ charges pending
Kulow, who submitted a letter of resignation from her position Oct. 3, reimbursed the college in the form of a personal check in the amount of $15,064.48.
“We are pleased that the concerns were identified internally and promptly investigated, and it has been rectified,” said Crittenden. “We have reviewed our policies and procedures and we’re continually looking for additional safeguards as to ensure this does not happen again in the future. But, any misuse of public funds is completely unacceptable.”
Crittenden told the board, in order for any expenditure to be made by an employee, documentation has to be submitted by the employee, which includes a payment requisition or a purchase order that identifies the college budget that is to be charged, a description of the item that is purchased and a receipt or an invoice. Additionally, the individual has to sign off on the purchase, or digitally acknowledge on the school’s computer system that the item has been received so the school has a record of all purchases and the individual making the purchases.
A copy of the final report has been sent to Tim Kenyon, Union County attorney, to review the matter for potential criminal charges. Additionally, a copy of the audit report has been sent to the Iowa State Auditor's office, which will publicly release the itemized report online at auditor.iowa.gov.