The Koret Foundation has turned a sad song into a triumphant blare of trumpets.

After finding out its $10,000 grant to buy children's musical instruments was somehow embezzled before making it to the San Francisco Unified School District, the S.F.-based philanthropy took action.

The board of directors recently voted unanimously to issue a new $10,000 check and put it into the hands of pleased district officials.

"They're on our hero's roll," Sally Ann Ryan, the district's supervisor for performing arts, said of Koret. The money paid for about 25 flutes, trumpets and violins, as well as a stock of violin cases, for the music programs of the district's elementary schools.

Ryan said the performing arts department would have been in a big financial hole if not for Koret, one of the country's largest Jewish-sponsored charitable trusts.

"Wasn't that nice of them?" Ryan said.

Initially, a $10,000 grant from Koret and a $6,000 grant from Chevron were given to a group called Save San Francisco School Sports and Performing Arts.

Ryan was presented with two oversized ceremonial checks at an elementary school music festival in May 1999 by that organization's president, Art Blum.

However, when the real check arrived several weeks later, it ended up bouncing and, after an investigation, the district ended up suing Blum. In turn, Blum sued two of his former bookkeepers, claiming they forged checks and stole money from his account. The case is under investigation.

"It's still not clear where the money is," said Sandra Edwards, Koret's senior program officer. "But whatever is going on, it's outside of our organization and doesn't involve us."

Shortly after getting the ceremonial checks, Ryan went to a music shop and made a purchase for her department, buying year-old instruments that were rental returns. However, without the money she was counting on, she ended up making a payment with funds from the department's trust account, putting the Youth Arts Festival in jeopardy.

"I had ordered about $10,000 worth of instruments," Ryan said. "I couldn't just tell the vendor, 'I'm sorry, the check bounced.'"

Koret heard about the situation in late May of this year and voted to issue the new check at its June board of directors meeting.

"It was a very easy decision to make," said Eugene Friend, the board's vice chairman. "It was an automatic."

Added Edwards, "It's obviously the right thing to do."

Koret, established in 1979, has assets of more than $250 million and is expected to hand out about $20 million in grants this year, so the $10,000 was a relative drop in the bucket. But that doesn't mean it was any less appreciated.

"I can't tell you how much it means to us," Ryan said.