This report covers the responses House Higher Education received for their RFI on Charge #5, relating to all audits performed, relevant to the committee’s jurisdiction, from State Auditor’s office. The RFI for this charge can be found here and a complete list of responses can be found here.
The HillCo report below is a summary of information intended to give you an overview and highlight of the various topics included in the responses. This report does not cover the entirety of each response, but aims to provide an overview of the testimony submitted.
- Provides a list of Higher Education related audit reports and recommendations
- Audit recommendations are rated by importance
- The following is an overview from the SAO highlighting the self-reported implementation status for reports issued through June 2019
- SAO Report No. 19-032 Review of Contracts at University of Texas System; the System Administration should:
- Ensure that it reports all contracts to the LBB in accordance with statutory requirements
- Strengthen its policies and procedures to ensure that contracts are reported accurately
- Recommendations are incomplete/ongoing
- Ensure the Alliance strengthens its procedures to complete and retain the required nepotism disclosure form
- Recommendation has been fully implemented
- Ensure the Alliance conducts quarterly business reviews, verify supplier performance reports, and develop risk assessment indicators
- Recommendations have been substantially implemented
- Ensure the Alliance develops policies for administrative fee calculation/distribution and develops a process regarding administrative fees
- Recommendations are incomplete/ongoing
- SAO Report No. 19-009 Review of the Financial Process at the Texas A&M Forest Service; the Service should:
- Develop a process to reconcile fleet vehicle statuses
- Recommendation has been fully implemented
- Implement application controls that enforce segregation of duties to ensure individuals cannot enter and release payments; or develop review controls to ensure all purchase transactions have requisite controls
- Recommendation has been fully implemented
- SAO Report No. 19-008 Review of Angelo State University’s Compliance with Historically Underutilized Business and State Use Programs; the University should:
- Verify that contractors submit all monthly Progress Assessment Reports and monitor contractors’ reported subcontracting activity to determine compliance with HUB
- Recommendation has been fully implemented
- Improve the process to identify HUB eligible vendors and establish a documented process for developing required supplemental reports
- Recommendation has been fully implemented
- Strengthen its State Use Program by ensuring purchasing/reporting concerning the State Use Program and develop processes to identify, document and report purchasing exemptions
- Recommendation has been fully implemented
- Ensure the level of assigned financial accounting system access is appropriate for the users’ job duties
- Establish a process to disable inactive users’ access to its financial accounting system
- Enhance the periodic monitoring of access and the documentation of tests of changes to its financial accounting system
- Recommendations have been fully implemented
- SAO Report No. 19-001 Review of a Selected Contract at the University of North Texas System; the System should:
- Reconcile the amounts reported as paid to subcontractors in the HUB Progress Assessment Reports with the amounts in the request for payment that the contractors submit
- Ensure contractors obtain the appropriate bond coverage and confirm contractors use E-Verify
- Recommendations have been fully implemented
- Continue to implement policies as required by the BOR rules
- Update its Contract Management Handbook to include negotiation and closeout processes
- Ensure individuals involved in contracts approval processes have completed required training and maintain training documentation
- Recommendations have been substantially implemented
- Report accurately its contracts to the LBB and updates its related policies and procedures to includes detailed information on contract reporting requirements
- Continue posting the required contract information
- Recommendations have been fully implemented
Texas Higher Education Coordinating Board
- THECB lists and responds to audit recommendations, including:
- Communicating Notice of Grant Awards and information as an addendum to existing ones
- Has completed the action plan
- Should verify that all purchasing personnel involved in its contracts; signing disclosures prior to forming contracts
- Completed the document review outlined in the action plan in August 2020
- Should establish a third-party tracker to monitor default claims
- Implemented the corrective action plan November 2018
- Should retain documentation to review employee time; process should be implemented to ensure tasks are completed prior to running their payroll allocation entries
- Implemented the corrective action plan January 2019
- Should ensure the accuracy of information submitted to TEA for the purposes of federal CTE grants
- Implemented the corrective action plan November 2018
- Should develop policies to calculate performance level results and strengthen data collection
- Internal Audit and Compliance Monitoring department currently conducting a review to confirm completion of the recommendations; results in October 2020
- UNT lists and responds to audit recommendations, including:
- Should develop/implement a process to reconcile the amounts reported as paid to subcontractors with the amounts in the request for payment that the contractors submit
- Amounts paid to subcontractors are reconciled to the HUB and final reconciliation is completed at the end of large projects
- Should develop/implement a process to ensure contractors obtain appropriate bond coverage
- Now requires a payment bond even if the municipality the work is being performed does not
- Should develop/implement a process to confirm contractors are using E-Verify
- Modified its competitive solicitation boilerplates
- Should continue to implement policies/procedures as required by its BOR rules
- Revised its training to include ethics, procurement methods and purchasing technology
- Should update Contract Management Handbook to include the negotiation/closeout processes
- Updated handbook to include contract negotiation/closeout processes
- Should ensure all individuals involved in the contracts approval processes have completed all required training and maintain documentation of that training
- Completed an Audit FY 19 to identify those who have not completed required training
- Report accurately its contracts to the LBB in accordance with the statutorily required timeframe
- Now current on all contract reporting to the LBB as required
- Lists and responds to audit recommendations, including:
- Should accurately report with all status changes and effective dates of the NSLDS
- Should develop/implement policies to monitor the information the NSC submits to the NSLDS
- Created a new time status; prevents the withdrawn status from being changed in NCS
- Preformed secondary reviews determining students’ withdrawn enrollment status
- New policy to allow instructors to provide reasoning when a student receives an “F” under certain circumstances
- State of Texas Federal Portion of the Statewide Single Audit for the Year Ended August 31, 2020 is in progress
- Audit report noted that processes could be strengthened to ensure vendor proposals are properly scored and required conflict of interest/non-disclosure statements are completed
- Taken corrective action to address recommendations; implementation will be completed by October 2, 2020
- Lists SFA audits and recommendations conducted by the SAO
- Notes three low risk and one medium risk recommendations by the SAO
- SAO released its Audit Report on Financial Processes at MSU, Report No. 20-025 in March 2020; Audit stated MSU should:
- Strengthen its reviews to ensure procurement card transactions are reviewed and approved
- Recommendation is substantially implemented
- Improve process for managing assets and improve those processes to ensure it maintains supporting documentation
- Recommendation is incomplete/ongoing
- Ensure that all budget transfers are approved and have supporting documentation as required
- Recommendation is incomplete/ongoing
- Ensure access to their data systems is restricted
- Recommendation is substantially implemented
University of Texas at El Paso
- Responds to audit recommendations from SAO Report No. 20-317 Student Financial Assistance Cluster (Report #20-317); the University should:
- Accurately report status changes and effective dates to NSLDS in a timely manner
- Implement a formal documented monitoring process to ensure accurate reporting to NSLDS
- Will continue to strengthen/monitor the timeliness of its enrollment reporting
- Responds to audit recommendations from SAO Report No. 17-022 An Audit Report on the UTEP’s Compliance with Benefits Proportional Requirement; the University should:
- Develop a process to verify it charges salary/benefit expenses to the correct cost centers; only eligible salary/benefit expenses are designated as educational and general expenses
- Recommendation is incomplete/ongoing; has been revised but needs additional detail regarding identification of eligible employees
- Responds to audit recommendations from SAO Report No. 19-030 Compliance with Federal Requirements for the Research and Development Cluster
- Management has developed various action plans to address deficiencies in the reports
- All proposed action plans have been implemented
- Responds to audit recommendations from SAO Report No. 19-032 Selected Contracts at The University of Texas System; the System should:
- Strengthen its policies and procedures to ensure contracts are accurately reported
- Recommendation has been fully implemented
- Ensure the Alliance strengthen is procedures to complete and retain required nepotism disclosure form prior to entering into a contract
- Ensure the Alliance conducts quarterly business reviews and obtains performance reports as required by contract terms
- Recommendations have been fully implemented
- Ensure the Alliance develops policies for administrative fee calculation and distribution and that it receives the correct amount of administrative fees in a timely manner
- Recommendation has been fully implemented
- Responds to audit recommendations from SAO Report No. 19-315 Federal Portion of the Statewide Audit; the University should:
- Calculating Cost of Attendance Budgets more accurately
- Audit determined TSTC took appropriate corrective action
- SAO currently performing an audit of financial processes at the college
- Currently no outstanding recommendations issued by the SAO
- SAO Report No. 19-008 Angelo State’s Compliance with Requirements of the HUB Program: recommendations have been fully implemented
- SAO Report No 19.041 Contracting at Texas Tech University System: recommendations have been fully implemented
- UT Austin lists and responds to audit recommendations; the university should:
- Strengthen controls to ensure it updates/maintains accurate property records, and strengthen controls over physical inventory/ follow up on equipment items identified as missing
- Are planning a businesses process review project and working with departments to provide training for inventory compliance
- Strengthen certain controls to ensure that the applicable financial reports UT Austin submits are complete and accurate
- Corrective action plan has been implemented
- Strengthen controls to ensure that UT Austin verifies that certain subrecipients for these funds obtain single audits
- Audit process is being redesigned; will allow for easier tracking of sub-awardee compliance and are developing an audit repository
- COVID-19 has delayed implementation actions; aims for completion August 2020
- Accurately report status changes and effective dates to the NSLDS, and establish and implement a monitoring process to ensure that status changes are reported accurately
- Made modifications to identify and report the final date of enrollment for all students who receive Federal Title IV financial aid are identified
- Strengthen its SEFA preparation and review its process to help ensure that it prepares its SEFA correctly; include reporting correct CFDAs for each federal award
- Revised existing training to include the proper classification of CFDA program
- Established weekly Annual Financial Report meetings
- Action plan has been fully implemented