President's Office

FISMA Audit Report

May 9, 1997

In the last issue of From the President's Desk (April 24, 1997), I reported that I had requested Vice President Art Elbert of Administration and Finance and Interim University Controller Robert Kiddoo to report to me on issues raised in a recent FISMA audit. This report was requested as a result of articles in the Los Angeles Timesthat questioned the university's practices and accountability in managing public resources.

I am pleased to inform you that Dr. Elbert and Dr. Kiddoo have completed their investigation and the full text of their report will be published in this Monday's edition of Copies are also available today, upon request, in the Office of the President, the Faculty Senate office, each Vice President's office, and the Dean's Office of each College.

I would like to reaffirm the university's commitment to rigorous financial accountability. We recognize the great trust that has been placed in us as a public institution and the need to ensure that the resources we are given to fulfill our mission are managed responsibly. As you will see in the summary below of our findings, we have taken the results and recommendations of the audit very seriously and worked diligently since then to correct any deficiencies in our procedures.

Summary of Report

Below is a summary of the main points of Dr. Elbert and Dr. Kiddoo's report:

  1. The FISMA audit found that "the campus was not clearing all travel advances in a timely manner."

    A review of the current status for the time period studied in the audit shows no outstanding travel advances. This is partly the result of improved travel advance procedures which are detailed in the report.

  2. The Los Angeles Timesreported that the campus auxiliaries owed money to the university in the form of "Non-Student Accounts Receivables/Non-Personnel Accounts Receivables."

    This is inaccurate; the auxiliaries do not owe money to the university. The University Accounting Department serves as the collection agency for the campus auxiliaries. Therefore, the receivables referred to in the Times story are actually debts owed to the auxiliaries.

    The university has implemented the recommendations of the FISMA audit in relation to Non-Student Accounts Receivables and Non-Personnel Accounts Receivables.

  3. Payroll and Salary Advances Accounts receivables which are defined as payroll and salary advances are, in fact, for work an employee has already performed.

    The audit did note that "the campus was not following up and collecting payroll and salary advance receivables timely." We have worked to resolve this issue on campus and have already successfully reduced the unresolved payroll and salary advances to 10% of the figure that was quoted in the audit. This was achieved by stringently enforcing collection procedures (more than 50% of the original figure) and by following the appropriate state procedures for receiving relief of accountability from the State. ("Relief of accountability" is the State's term for writing off accounts.)

  4. Other major actions taken as a result of the FISMA audit report, prior to the Los Angeles Times articles:
    • We have appointed an Interim University Controller to provide leadership for improved accounting and control procedures.
    • We have appointed two additional employees to implement new payroll processes and increase effectiveness.
    • We have collected 78% of reported outstanding non-student accounts receivable.
    • We have received approval from the State Board of Control for relief from accountability for $93,000 in payroll and/or salary accounts receivable which were beyond the legal statute of limitations for active collection.
    • We have collected or established employee repayment plans for 87% of remaining payroll and/or salary accounts receivable.
    • We have established policies and procedures to assure that payroll and/or salary accounts receivable will not accumulate in the future.
    • We have initiated a comprehensive cross departmental program to design a new, automated personnel, payroll, purchasing, accounting, and budgeting system.

Reports in the Media

While I have been pleased to answer requests about how the university has responded to the very valid and serious concerns raised by the FISMA audit, I believe the reports in the Los Angeles Times are egregiously inaccurate and have resulted in specific damage to the university.

As a result, for the first time in my professional career, I will be meeting with the Los Angeles Times editors this morning to request a formal retraction of specific misrepresentations in the articles and to lodge a complaint about the reporter.

It is important that you know that the university did not release names of employees, past or present, to the Times and we know of no university official who characterized employees as "deadbeats," as the Times reporter demeaningly referred to these individuals. I share the outrage of affected faculty and staff about the tone of the coverage and the personal insults to which they have been subjected.

I think the study conducted by Vice President Elbert and Dr. Kiddoo is an accurate and honest report of the response of the accounting and payroll departments to the audit recommendations, and I want to thank them and their staff for their prompt implementation of corrective actions. We will continue to improve the accuracy and efficiency of service to university employees and will seek to have our reputation restored.

Blenda J. Wilson

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