BISMARCK-The State Board of Higher Education Audit Committee discussed compliance and auditing issues at length in a meeting Monday.
Using a new tracking tool, North Dakota University System employees can now track the 107 audit issues that have yet to be fully resolved from areas including technology, overall performance and finances.
Special Projects Assistant Laura Anne Schratt said when she started creating the tracking tool audits hadn't been updated online since October 2012. She updated 209 recommendations contained in 25 separate audits and 93 of which hadn't been implemented at the system level or in schools. Fourteen remained unresolved from prior to the last 2012 update.
"This is unprecedented," outgoing Interim Chancellor Larry Skogen said. "Audit reports come in and they're stacked someplace ... there were 25 that weren't even tracked. This gives us the opportunity to review as we move forward."
Committee Chairwoman Kathleen Neset spearheaded conversations about when the audit committee should get involved as representatives of the full board and to what extent, as audit issues vary widely in severity and importance.
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"I'm not an auditor, but I'm also responsible for the outcome of these reports as a board member," she said.
Schratt said the tracking tool, available only internally through the system's website, will be updated on a quarterly basis.
Other business
The group went into executive session to discuss the system's operational audit report.
Afterward, Audit Manager Robyn Hoffmann with the Office of the State Auditor explained how her office will be addressing the financial audit for the system since a bill passed in the legislative session removed all but $300,000 in funding for NDUS internal audit positions.
Hoffmann said areas of significant risks within the NDUS include a lack of comprehensive fraud and risk management, a new accounting standard involving pensions and a lack of internal audit staff and management of controls.
"The State Board of Higher Education has been written up consistently for not having enough internal audit staff," Skogen said. "I think we were just getting our sea legs ... when all of a sudden the wind shifted this last session, and the board is at incredible risk now."
The system's financial audit timeline was also laid out for the committee, with a final draft report being published in January 2016.
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The SBHE oversees the state's 11 public colleges and universities, many of which have nonprofit foundations. Hoffman said financial audits for those entities will be done by privately selected external firms chosen by each foundation.
These audit reports are not presented to the SBHE Audit Committee, but Chief of Staff and Ethics Officer Murray Sagsveen said that wouldn't have made a difference with recent controversy concerning the Dickinson State University Foundation, which was put into receivership after financial issues came to light in an audit.
System employees are also working to standardize data definitions within the NDUS accounting manual.
Due to a caveat in the higher education funding bill passed during the last legislative session, Vice Chancellor for Administrative Affairs Laura Glatt said they must now make the biennial budget request in the same way other state agencies do, which is highly detailed and technical in nature and will therefore take more time and effort.
