Criteria or specific requirement: Management is responsible for establishing and maintaining effective policies and procedures for financial operations.
Condition and context: During the audit of fiscal year 2021 financial statements, it was noted that the Business Office Policies and Procedures Manual had not been updated since 2010. As some procedures were no longer relevant to financial operations, certain University departments were using self-created policy and procedure drafts that had not been formally approved by management.
Cause: No process was in place for the timely review and revision of the Business Office Policies and Procedures Manual.
Effect: Without necessary reviews and revisions of financial policies and procedures to guide financial operations, the University is at greater risk of inaccurate, inconsistent, and irrelevant financial reporting and, further, is unable to properly safeguard financial assets.
Recommendation: We recommend that the University implement a policy to review the Business Office Policy and Procedure Manual at least annually and make revisions as necessary to support financial operations.
Views of responsible officials and planned corrective actions: The University concurs with the finding mentioned above. In an effort to enhance the accounting and reporting system, as well as internal controls, the University has crafted an updated policy and procedure manual. This manual is designed to align not only with GAAP but also with the NACUBO (FARM) manual as it pertains to our policies and procedures. The University commits to ongoing updates of this newly created annual as changes arise with standard operating procedures.
90.