Without quality backup from a central financial office, it is unlikely any of the state's public schools could withstand a comprehensive audit because heightened expectations for principals have added too much paperwork and not enough funding, officials said yesterday.

The comments came at a meeting of the Board of Education Audit Committee, where members heard updates from Kailua High School eight months after it received a scathing audit that questioned whether school leaders could shoulder the new responsibilities called for under Act 51, the comprehensive school reform law passed in 2004.

At the moment, committee officials acknowledged, the answer would be "no" — not just for Kailua but for any school in the state.

The Department of Education lacks a centralized fiscal management system that would allow schools to create real-time reports on payroll and other financial transactions. Meanwhile, principals have been asked to take charge of 75 percent of the schools' budgets.

"These are systemic problems. They're systemwide and that's going to impact any and all future audits and they're going to find the same problems," said Board of Education Audit Committee chairwoman Donna Ikeda.

With no one from the State Auditor's office present, committee members criticized the September 2006 audit, which not only cited specific instances of financial mismanagement, but criticized the school's academic performance over a decade and even faulted the school because some students were allowed to turn in substandard work and most students don't do enough reading.

The audit examined academic performance under two principals, which Ikeda called grossly unfair.

"I really do think going back 10 years is extremely Draconian, when you've been on the job for only three years," Ikeda told Kailua High principal Francine Honda.

Ikeda also questioned whether the auditors had the educational background to judge the school academic programs.

Honda said the school had been surprised at the scope of the audit and morale suffered when staff and students realized that the report covered more than just financial issues.

Nevertheless, she said the school has moved on, and she delivered a 21-page report that explained how the school is addressing the auditor's recommendations.

"We have made some progress, of course, but we still have a long way to go," Honda said.

Board member Kim Coco Iwamoto said that the audit could be used as a tool to help other schools as they try to meet standards expected by the Legislature and its auditor.

"If we are going to try to live up to their standards, the standards the auditor suggested we live up to, do we have the capacity at this time to meet all of these requirements?" Iwamoto asked.

Schools superintendent Pat Hamamoto said the department has already taken steps to address some of the systemwide issues.

In addition, she said the audit revealed problems that the department was able to address swiftly, such as removing 15 coaches from schools because they had not been given mandatory background and fingerprint checks.

"We did find some gems that we could work with and we could do. In that sense it was good," Hamamoto said.

But Hamamoto added that the report went beyond the scope that the auditors had originally set.

She said she was frustrated that the department wasn't able to give responses that would put the findings into perspective.

However, Kailua school leaders are sharing their experience with other schools so the next one to be audited will at least have an idea of the areas that will be assessed.

"If the auditor were to go to another schools, would the other schools be prepared to answer these types of questions?" Iwamoto asked.

Hamamoto replied: "Yes."

Reach Treena Shapiro at tshapiro@honoluluadvertiser.com.