===== PAGE 1 ===== # KENTUCKY STATE UNIVERSITY BOARD OF REGENTS FINANCE & AUDIT COMMITTEE REGULAR MEETING Meeting Was Conducted in Person and by Teleconference Monday, April 1, 2024 10:00 a.m. EDT # Board of Regents Room Julian M. Carroll Academic Services Building, 2nd Floor 400 East Main Street Frankfort, Kentucky 40601 (Primary Physical Location) MINUTES ***** ### I. Call To Order The Committee’s Chair, Regent Edward Hatchett, Esq., called the meeting to order at 10:07 a.m. ### II. Roll Call The Board's Secretary, Zachary Atwell, called the roll: Regent Edward Hatchett, Chair Present Regent Ernie Fletcher, Co-Chair Present Regent Tammi Dukes Present Regent Robert Ramsey, Sr. Not Present (Joined After Roll Call) At least three (3) Regents were in attendance and present at roll call. A quorum was therefore established. Regent Ramsey joined shortly after roll call. ### III. Approval of the Agenda MOTION by Regent Ramsey: Move the Committee to approve the agenda of the April 1, 2024, meeting of the Finance & Audit Committee. Seconded by Regent Fletcher and passed without dissent. ### IV. External Audit Update and Plans This agenda item was presented by Mr. Allen Norvell, Director of Blue & Co. LLC. Mr. Norvell began by discussing progress on the FY22 audit, specifically addressing the status of the financial audit as well as financial aid and non-financial aid components of the compliance audit. He noted that several FY21 findings were repeated in FY22, as expected, simply because there was not an opportunity at the conclusion of the FY21 audit to address those findings during FY22. ===== PAGE 2 ===== Next, Mr. Norvell shared a draft of the FY22 audit with committee members. Chair Hatchett inquired when the final version will be completed and available. Mr. Norvell responded that it would be available on April 9. Mr. Norvell continued his presentation with highlights of the FY22 audit findings. Regent Dukes asked whether anything else besides the outstanding legal letters and internal quality review would prevent the Board from receiving the final report by April 9. Mr. Norvell stated that nothing else would impede delivery by the April 9 date. Regent Dukes suggested to Chair Hatchett that the Committee convene for a special meeting after April 9 to review the final report. Chair Hatchett requested that Mr. Norvell elaborate on the certificates of participation. Regent Moyer inquired into the maturity of the long-term debt and the state loan. Regent Fletcher queried whether Mr. Norvell had reviewed any agreement establishing the debenture from the University to CPE. Mr. Norvell responded that he was not aware of any documents other than HB 250 and the MIP. Regent Fletcher asked Chair Hatchett whether it was unusual to have a loan between agencies without specific documentation setting forth terms and conditions. Mr. Travis Powell, VP and General Counsel for CPE, joined the meeting and provided clarification as to repayment terms regarding the $23M loan received from the State. Mr. Norvell concluded the FY22 audit presentation and opened the floor for questions. Hearing none, he moved forward with an update on the FY23 audit, including next steps to be taken. Chair Hatchett asked Mr. Norvell when he expected to have the FY23 audit completed. Regent Dukes sought clarification that Mr. Norvell had not yet received the FY23 ledgers. Mr. Norvell responded affirmatively. Regent Dukes queried when the audit would be ready once Mr. Norvell has the ledgers. Mr. Norvell responded that he did not have an answer to that. ### V. Internal Audit Update Mr. Benjamin Martin, Senior Manager, CBIZ, presented this agenda item. Mr. Martin introduced Ms. Megan Young and Ms. Miranda Murray. Ms. Young began the update with a discussion of accomplishments to date, including the completion of the financial aid and fixed asset existence audits, then explained the next steps to be taken. Mr. Martin joined the presentation, stating that management had determined that a Banner license review and Sodexo invoice review were not needed. Chair Hatchett inquired whether it was fair to say there would be no Sodexo overhang regarding this work since they are no longer a contractor with the University. Regent Dukes asked Ms. Young whether she also could summarize the status of remediation for each audit finding, inquiring whether the University is on track for resolving issues or whether this is just a list of findings for which no action has been taken. Ms. Young concluded the presentation with an internal audit timeline update. ===== PAGE 3 ===== ### VI. "Tell It" Hotline Report The Board’s Chair, Regent Tammi Dukes, presented this agenda item. Regent Dukes remarked that the “Tell It” six complaints have been received. Of those complaints, three were related to ethics, two were related to health and safety concerns, and one was categorized as “other.” Reporting was done primarily through email, the web-related interface, or live telephone conversation. Most of the issues were found to be unsubstantiated or were under investigation. To date, no serious issues were identified; though some of the reports were alarming, they were investigated and were considered unfounded or unverified. Currently, there is no comparative year-over-year or quarter-over-quarter data to identify the types of incidents being reported, as the hotline was implemented in early 2023. ### VII. Budget to Actual Accounting Update This agenda item was presented by Ms. Vicki Dunaway, VP for Finance & Administration and Chief Financial Officer, and Mr. Justin Peach, Budget Director. President Akakpo introduced Ms. Dunaway, who greeted committee members and shared her background. Mr. Peach began with the E&G Budget to Actual as of February 29, 2024. Chair Hatchett requested Mr. Peach to elaborate on the “Destiny and Legacy Tuition and Fees” category, and further inquired whether a key could be provided to explain the components of each category. Next, Mr. Peach presented the Asset Preservation Budget to Actual and Auxiliary Budget to Actual, noting that the University is on track to have a surplus from Auxiliary at the end of the year. Ms. Dunaway concluded the presentation and confirmed that deliverables would be provided to Blue and Co. within the next week. ### VIII. Closing Remarks Chair Hatchett thanked all committee members and presenters for their participation during the meeting. ### IX. Adjournment MOTION by Regent Dukes: Move the Committee to adjourn. Seconded by Regent Fletcher and passed without dissent. The meeting was adjourned at 11:34 a.m. ===== PAGE 4 ===== Submitted by:
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Zach Atwell, Secretary Board of Regents Kentucky State University Regent Edward Hatchett, Esq., Chair Finance & Audit Committee Board of Regents Kentucky State University
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Approved with no corrections ___ Approved with corrections