The former educational director at the District's facility for juvenile delinquents did not document purchases made using the school's checking account, bought three laptop computers without prior approval and failed to keep adequate financial records, according to an internal audit by the D.C. public school system.

The audit was completed in July after the two court-appointed receivers for Oak Hill Academy, the school at the Oak Hill Youth Center in Laurel, reported "financial irregularities" there. The long-troubled school, which is responsible for teaching children committed to the youth center for delinquency as well as those awaiting trial, was put under receivership in September 1998.

The audit examined purchases made under the direct activity purchase system, which allows principals at D.C. public schools to bypass the procurement process and purchase supplies and equipment.

According to school records, $98,418 was wired to the Oak Hill school's direct activity account in October 1998, two months after Ira K. Thomas became the school's director. In the six months after the account's creation, Thomas missed deadlines on required monthly financial reports and failed to present a spending plan, the audit found. He also failed to document spending from the account.

Eugene P. Smith, director of the school system's internal audit division and author of the report, also noted that he could not locate 53 canceled checks, 10 blank checks from the school's checkbook or invoices supporting eight payments by check. Smith directed the Oak Hill school to put stop payments on the missing checks, request copies of the missing canceled checks and search for the missing invoices.

In an interview last week, D.C. School Superintendent Arlene Ackerman, who ordered the audit, said she questioned Thomas's capabilities soon after placing him in charge of the school. Thomas was removed as Oak Hill's educational director in February and was transfered to Ballou High School, where he is an assistant principal.

Thomas said yesterday that he had not read the audit. He did not return a telephone message after a copy was provided.

Two special education experts at the University of Maryland at College Park, Peter E. Leone and Sheri M. Meisel, were appointed the school's receivers a year ago. Their task is to overhaul the troubled school and make it comply with the consent decree that settled Jerry M. v. District of Columbia, a 1985 class-action suit filed on behalf of Oak Hill's children.

The school system's security director is trying to trace the missing blank and canceled checks. In an interview, Leone said he believes there are still questions concerning about $6,000 in purchases from the direct activity account. Those expenses include a $1,000 payment to a telecommunications company, the purchase of a personal tax-preparation software package, and a $5,000 payment for an Internet connection that apparently was never installed, Leone said.

Attorneys for Oak Hill's children said they were angered that funds were not documented. Donna L. Wulkan, an attorney in the Jerry M. suit since 1986, said the school system should have discovered the flawed record-keeping before the receivers pointed out the problem. The audit's recommendation that Thomas's successor follow tighter accounting and planning procedures also does not go far enough, Wulkan said.

"If they found that he was in any way misusing money or using Oak Hill school resources for personal uses, it seems to me that some action should be taken other than to say, 'Well, we need to monitor the [direct activity] account better next time,' " Wulkan said.

Ackerman said she voiced her concerns about Thomas last year, but the receivers and Superior Court Judge Richard A. Levie, who enforces the consent decree, did not act to remove Thomas until this spring. "I would have moved him sooner--a lot sooner," Ackerman said. "But I had no authority. He reported to them."

Leone said the receivers raised concerns about Thomas's performance in November and requested the audit in June. "We were sure, probably by some time in December, that we wanted to get rid of Thomas, but given the turmoil that Oak Hill had experienced over a number of years," the receivers decided to find a replacement first, Leone said.

Ackerman said Thomas's responsibilities at his new post do not involve handling school finances. "They thought he was really good working with young people," Ackerman said of school administrators. "I thought it was a good fit."

CAPTION: D.C. School Superintendent Arlene Ackerman questioned Ira K. Thomas's abilities soon after placing him in the Oak Hill Youth Center post.