The Halifax Community College Foundation in Weldon misspent nearly $140,000 intended for student scholarships, according to a new report from state Auditor Beth Wood’s office.
Instead of scholarships, the foundation spent $129,017.48 of the funds for general expenses, the report says. The foundation also awarded $9,174.67 in scholarships that exceeded donation limits.
“The foundation receives donations that are often restricted for scholarships to students at Halifax Community College,” the report says, adding that state law says that “such donations should be used in accordance with donor restrictions and such use should be executed in good faith, with the care of an ordinary prudent person.”
The auditor’s office recommended that the foundation move to an accounting system that tracks spending restrictions to ensure the money is used properly. “Procedures should be implemented to avoid using restricted funds, even temporarily, for purposes other than those designated by donors,” the report recommends. Funding from unrestricted sources should be used to cover unrestricted cost, the report says.
In the foundation’s response, it said that prior to 2012 it did not have adequately trained personnel and was not aware of proper accounting and reporting procedures for 501(c)3 nonprofit organizations. Since then, the foundation hired a certified public accountant with nonprofit experience to help with the books.
The report also says that the foundation recognizes the need to make the scholarship account whole. The foundation also hopes to use money from its “Brick by Brick” campaign to do that.
According to the college’s website, the “Brick by Brick” campaign sells engraved bricks to donors. The bricks will be placed at the main entrance to a prominent building on the college campus.