Utility and telecom bills are voluminous, which makes it difficult to perform a full review of all the charges that are listed. If you take a deeper look, you may be surprised to see hidden fees and/or taxes buried in these massive invoices. That being said, school districts are sales tax exempt organizations. Now, one would think the invoices should not contain sales tax, but more often than not, they are included in some manner. And we all know what it is like to call these companies: the endless wait time, and then when you finally reach a human to inquire about the charges, you are instructed that schools are not tax exempt when it comes to these types of charges. Not true!
All the rules and regulations involved with the telecom and utility companies, along with the best pricing for services, is not something most of us have knowledge of. Even though we are auditors for school districts across the Island, as well as many non-profits in the tri-State area, we know when we need to bring in subject matter specialists to perform a review. We had an audit performed by Prime Auditors; a local company based in Mineola which has been helping school districts across the Island since 1981. Although we are not a tax-exempt company, they were able to identify services that we weren’t using yet still paying for and noted where we could cut our costs further. So what is the process you ask? You have to provide one month of bills and sign a release form. Now let’s talk numbers. The cost factor is simple: you pay nothing unless the review reveals the company saved your district money. At that point, the company collects a percentage of the savings they identify.
We asked Prime Auditors for a list of questions school districts should consider when determining whether a review of telecom and utility invoices should be performed:
- Are you confused about what taxes and surcharges you should be paying?
- How is the District dealing with the reality that E-rate monies are no longer available for telephone services?
- Are you aware there are special refunds available to schools going back for a period of 3-6 years in many cases on almost all telecom and utility charges?
- How much money are you wasting each month on your telecom and utility accounts by not being in the best rate plans?
- Are you taking full advantage of all of the NYS pricing programs that are available on your telecom and utility accounts?
- Are you aware that carriers are providing a six-year year “lowest corresponding price” refund if your school wasn’t getting the same low price as neighboring districts? One small district (under 700 students) got a refund of over $70,000.
With the tax cap squeezing school districts’ ability to obtain increases needed to ensure that educational programs are fully supported, cutting expenses should be a top priority. The best part about this audit is that school districts have nothing to lose by having their utility and telecom bills reviewed. Are you willing to pass up potential refunds and lower bills? For more information, contact John Coyne and/or John E. Appelt, at Prime Auditors (516) 403-1204. You can check out their website at www.primeauditors.com.
This article was also featured in our newsletter Lesson Plan Vol. 21
Shari Diamond, CIA
Partner
