Response:
- KSU ensure findings and recommendations from the Procurement Card internal audit, performed by its prior internal auditing firm, are reviewed and considered in light of current procedures and activity.
KSU has not implemented this recommendation. Board members may easily be added as authorized users of the University's contract depository (Lexion), which will allow them to keep track of approved contracts. However, the Board has not yet developed a process for following up on deliverables from approved contracts. The Board has prioritized other pressing matters but will develop a process as soon as practicable.
Response: KSU has not implemented this recommendation. The University has asked the current internal auditing firm to contact the prior internal auditing firm and review the findings and recommendations from the Procurement Card internal audit and present its recommendations.
Finding 4: Lacks Controls to Prevent Overspending and Failed to Ensure Completeness of its Accounting Records.
Recommendations:
- KSU address the deficiency with the Banner system so expenditures that go over the budget are rejected and must be reviewed, and a budget revision be made before the override approval is given by the EVP for Finance. Budget issues should be discussed with the department head responsible for managing the budget and budget amendments should be presented to the Board.
Response: KSU has implemented this recommendation.
- KSU provide continuous efforts to ensure that purchase orders are not circumvented. While emergencies will always occur, this situation should be rare. Documentation should be maintained when the PO process is not followed.
Response: KSU has implemented this recommendation.
- KSU review its reliance on credit cards to meet daily operational needs. Any employee provided a credit card should require supervisory review and written approval of credit card spending. The review must ensure not only that the documentation exists, but also that the purchase was for a university necessity and not personal purpose, and sufficient budgeted funds exist to support the purchase. Additionally, if the expense relates to items purchased as gifts or for meals, documentation should include names of individual recipients or attendees. Additionally, credit card usage by executive level staff, including the president, should be routinely reviewed by internal audit and a report made periodically to the Board or a committee of the Board.
Response:
KSU has implemented this recommendation. Executive-level staff have not used a credit card since the draft of the APA’s special examination report was received by the University. If executive-level staff utilize a credit card, the usage will be shared with the Board periodically.