suggested that in order to reduce the frequency of this approval and to not hinder the University President’s ability to represent the University, the approval of travel plans and / or actual expenses could be on a quarterly basis. Mr. Quick stated he will perform a review of all Presidential expenditures on a yearly basis to determine whether expenses are appropriate, accurate and in compliance with institutional policies. President Thompson questioned whether such a policy would be for pre-approval or a review of subsequent travel expenses. Regent Farris stated that she would agree with a policy that would not hinder the University President’s ability to travel. The external auditor, Crissy Fiscus with Dean Dorton Allen Ford, PLLC, stated that the President’s travel should not require pre-approval unless the travel will exceed a certain dollar amount. Ms. Fiscus stated that ultimately it is the Board of Regents’ fiduciary responsibility to have knowledge and awareness of Presidential travel expenses. She stated the related risk would be the Board of Regents not knowing of inappropriate expenses. Mr. Quick stated he would draft a proposed Presidential travel policy that could be reviewed by the Board of Regents for implementation.

Mr. Quick requested the approval of the amended charter which was revised to include language which clearly defines the Office of Internal Audit's functional reporting relationship to the Board of Regents. Mr. Quick stated the proposed revisions to the charter would further strengthen the organizational independence of the Office of Internal Audit.

Action: Motion to approve the proposed charter for the Office of the Internal Audit was made by Regent Farris and seconded by Regent Gilmore. The motion was approved unanimously.

The Vice President of Business Affairs, Greg Rush, introduced Crissy Fiscus and Megan Crane with Dean Dorton Allen Ford to give a status of the University’s financial audit. Mr. Rush also informed the Board of Regents that the audit had not yet been completed. Ms. Fiscus provided preliminary results of the audit in their management letter which was presented to the Board of Regents. Ms. Fiscus stated they considered the following deficiencies in the University’s internal control structure to be material weaknesses: financial reporting, credit cards, cash disbursements and vendor payment activity. Regent Barfield asked whether there would need to be a special meeting to approve the external audit of financial statements when complete. Mr. Rush stated that the external audit would be disseminated to the Board of Regents when complete and there should be an action item requiring approval of the audit in the January 2017 meeting.

Motion for adjournment of the Audit Committee was made by Regent Bearden and seconded by Regent Farris. The meeting adjourned at 3:07 p.m.

[6]