SABIS International Charter School was among 24 Commonwealth charter schools included in a study undertaken by the Office of the Inspector General in March 1998. The Office identified weaknesses in the contracting practices, procurement procedures, and financial management. Findings include: (1) the Board of Trustees did not employ sound business and contract oversight practices in administering the school's financial relationship with SABIS, Inc. during the first 5 years of school operations; (2) the contract with SABIS, Inc. executed by the board in March 2000 would significantly increase the school's exposure to fraud, waste, and abuse; and (3) the Board of Trustees did not accurately document its official actions and policies. The Inspector General recommended that the Board of Education should disapprove any contract between the school and SABIS, Inc. containing the risky and unfavorable provisions mentioned above. The Inspector General also recommended that the Board of Trustees evaluate alternatives to recontracting with SABIS, Inc. to manage the school's business operations; directly select, contract with, and oversee the school's independent auditor; and conduct or commission a systematic analysis of the school's financial requirements before borrowing additional funds from SABIS, Inc. or any other source. An appendix contains the response of the SABIS International Charter School Board of Trustees. (RT)