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1. Superintendent of Direction for the California schools, Jack O'Connell, started an audit more than a year back into the fiscal issues of the Alternatives for Youth and Opportunities for Knowing (OYO) schools. The OYO is a chain of independent study charter schools within the California schools system, which are independently run however moneyed by the state. The OYO California schools serve trainees who have actually left of the conventional high schools. They presently have about 15,000 trainees in 40 storefront locations throughout the state. These California schools students do the majority of their work at home, conference with teachers twice a week. According to state records, student achievement test and high school exit examination scores are above average, as compared to other alternative high schools within the California schools system. According to a Los Angeles Times short article of August 10th, only 11 percent of OYO students graduated during the 2003-2004 academic year. The car donation kpcc remainder of trainees that left school that year either left, were expelled, or transferred to other schools. The California schools' audit was conducted by the Fiscal Crisis and Management Help Group, who concluded their analysis and presented their findings in a report that was launched in August 2006. The audit mentions accounting flaws, overpayments by the state, disputes of interest, nepotism, extreme settlement, and blending private business issues with public schools. The OYO was established and still run by John and Joan Hall, previous instructors from Hollywood High School. They have actually fully complied with the California schools' audit, but disagreement the majority of the findings. Some examples from the audit report are: • Accounting Defects and Overpayments. The Halls count each of their teachers as 1.92 full-time positions. Their spokesperson, Stevan Allen, mentioned that this is a typical practice for charter schools in the California schools system and is a legitimate approach for compensating school personnel for longer days and year-round schedules. California schools superintendent O'Connell believes teachers need to be counted only as one full-time position each. The auditors disagreed, citing that traditional California schools instructors invest much less time working each year than those at OYO. However, the auditors thought the 1.92 amount is pumped up. This example, alone, accounts for more than half of the $57 million overpayment. In addition, the report noted several doubtful costs. One example of unrestrained costs, offered by the Times was an $18,000 staff celebration held at Disneyland. Allen safeguarded that occasion as an effort at relationship structure between personnel members, who are scattered throughout the state. He kept in mind that the costs was less than $50 per employee. • Conflicts of Interest and Mixing Private Business with Public Schools. Besides the charter schools, the Halls own and run a number of private services that offer products and services to schools. The Times kept in mind that the Options in OYO was the nonprofit part of the setup, with the Opportunities part being for-profit. The audit calls this practice and setup into question. • Extreme Compensation. The audit also questions the combined wages for the Halls, which is $600,000 each year. The report mentions that it may be extreme for the amount of time the couple actually works. • Nepotism. The Halls developed a separate charity with $10.8 countless the California schools' financing, called Pathways in Education. The charity is run by their daughter, Jamie Hall. Little money has actually been invested toward education hence far. The Halls contend that they previously had requested assistance on their operation from the California schools often times, however never received any reaction. Therefore, they tried to follow California schools requirements as best they could with their understanding of the policies. Even O'Connell yielded that none of the cited practices

2. are unlawful. The audit advises the California schools should attempt to recover the $57 million in overpayment from the OYO. O'Connell has sent the report to the state's chief law officer's workplace for review and any needed action.