Office of Labor-Management Standards (OLMS)
U.S. Department of Labor Employment Standards Administration
Office of Labor-Management Standards
Cleveland District Office
1240 East Ninth Street
Cleveland, OH 44199
(21 6)357-5455 Fax: (21 6)357-5425
August 1, 2008
Mr. Chad Caldwell, Treasurer
School Employees Service Union Ind.
6805 Oak Creek Drive
Columbus, OH 43229
LM File Number 515-114
Case Number: -
Dear Mr. Caldwell:
This office has recently completed an audit of School Employees Service Union Ind. under the Compliance Audit Program (CAP) to determine your organization's compliance with the provisions of the Labor-Management Reporting and Disclosure Act of 1959 (LMRDA). As discussed during the exit interview with you on July, 16 2008, the following problems were disclosed during the CAP. The matters listed below are not an exhaustive list of all possible problem areas since the audit conducted was limited in scope.
Title II of the LMRDA establishes certain reporting and recordkeeping requirements. Section 206 requires, among other things, that labor organizations maintain adequate records for at least five years by which each receipt and disbursement of funds, as well as all account balances, can be verified, explained, and clarified. As a general rule, labor organizations must maintain all records used or received in the course of union business. For disbursements, this includes not only original bills, invoices, receipts, vouchers, and applicable resolutions, but also documentation showing the nature of the union business requiring the disbursement, the goods or services received, and the identity of the recipient(s) of the goods or services. In most instances, this documentation requirement can be satisfied with a sufficiently descriptive expense receipt or invoice. If an expense receipt is not sufficiently descriptive, a union officer or employee should write a note on it providing the additional information. For money it receives, the labor organization must keep at least one record showing the date, amount, purpose, and source of that money. The labor organization must also retain bank records for all accounts.
The audit of SESUs 2007 records revealed the following recordkeeping violations:
1. General Expenses
SESU did not retain adequate documentation for disbursements totaling at least $2,230.00. For example, SESU failed to maintain backup documentation for purchase of flowers in January 2007; a donation made in May 2007 to the Martin Luther King Jr. Memorial Fund; and a travel advance paid to member --- in June 2007.
As previously noted above, labor organizations must retain original receipts, bills, and
vouchers for all disbursements. The president and treasurer (or corresponding
principal officers) of your union, who are required to sign your union's LM report, are
responsible for properly maintaining union records.
2. Bank Records
SESU did not retain pages three and four of their August 2007 bank statement.
As previously noted above, labor organizations must retain bank records for all account. The president and treasurer (or corresponding principal officers) of your union, who are required to sign your union's LM report, are responsible for properly maintaining union records.
Based on your assurance that SESU will retain adequate documentation in the future, OLMS will take no further enforcement action at this time regarding the above violations.
During the audit, you advised that SESU checks require only one signature. This is not an effective internal control of union funds. A two signature requirement is an effective internal control of union funds. Its purpose is to attest to the authenticity of the disbursement. OLMS recommends that SESU review these procedures to improve internal control of union funds.
I want to extend my personal appreciation to School Employees Service Union Ind. for the cooperation and courtesy extended during this compliance audit. I strongly recommend that you make sure this letter and the compliance assistance materials provided to you are passed on to future officers. If we can provide any additional assistance, please do not hesitate to call.
cc: Rachel Morrow, President