The University is a step closer to having an external audit, per the UNM Faculty Senate’s request last semester.
The UNM Board of Regents Audit Committee met Friday and made a recommendation of how the state auditor should examine the University’s finances.
Senate President Doug Fields said the regents should consider the faculty’s mistrust of the administration before making their recommendation.
“Why can’t we just ask internally how the Rio Rancho Campus is being funded? The answer is, ‘We don’t trust the answer,’” Fields said. “We would like to have an external, independent audit of these things so that we trust the answer.”
The committee met to discuss the recommended scope of work for the audit, which the voting faculty requested in late February at a meeting that also saw votes of no confidence in three University administrators.
According to the motion requesting the audit, “it is in the best interest of the University of New Mexico to understand how its resources were used to further its mission” and “transparency in decision-making allows organizations to make better decisions through deliberations.”
To this end, State Auditor Hector Balderas suggested four “items” or areas of UNM’s finances the auditing firm would examine. The Board of Regents will consider the committee’s revised version of these suggestions at their Sept. 29 meeting. If approved, the suggestions will be sent to Balderas, who will appoint a firm to conduct the audit.
Faculty members at the meeting Friday said the audit should investigate the allocation of funds. The faculty requested that the sentence “Include a comparison of budgeted amounts to actual expenditures/revenues where applicable” be added to the end of item No. 1 (see box).
The committee agreed to conduct an internal audit of item No. 4 and compare it to the results of the external audit. Audit Committee Chairman Gene Gallegos said that if the internal and external findings are the same, the simultaneous audits will improve trust between faculty members and the University administration.
“Let’s see how things match up. Maybe that will help with your trust factor if you find out that what they came up with and what the outside auditors came up with (are similar),” he said. “This trust thing, you’ve got to lay that to rest at some point.”
Fields said the faculty is often out of the loop when it comes to University decision-making, and he wants a seat at the table during the audit process.
“I’m trying to argue that if the Faculty Senate president was involved in the process — as much as the law and the policies permit — that if the faculty have a complaint, have a feeling that information is being withheld, they can look at me,” he said.
The committee discussed having Fields sign a confidentiality agreement to avoid disclosure of personal information in the periodic audit reports. Fields said he would sign the form only if it didn’t stop him from relaying pertinent information to his colleagues.
Regent Jamie Koch presented a motion at the end of the meeting to penalize UNM’s colleges if the auditor finds that the faculty’s “claim” was untrue. The motion was not seconded.
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“I move … that the payment of the audit should be charged to the administrative budget if the audit provides evidence to support the faculty’s claim that instructional moneys were used for administrative purposes,” Koch said. “If the independent audit does not provide evidence to support the faculty claim, the payment will come from unrestricted balances in the colleges.”
Gallegos said the audit should not be punitive.
“I’m not sure that there’s a faculty claim,” he said. “And if we’re going to turn around and assess in some way the faculty for the expense of it, I don’t think that has been the issue.”
Fields said Koch’s motion is another example of why the faculty distrust administrators.
“The motion that Regent Koch has put forward, I think, is a demonstration of the problem that we want to see addressed,” he said. “And the belief that it’s a different pool of money to pay for administration costs than to pay for teaching or research or anything else — it’s one pool of money.”
The committee also eliminated item No. 2, which asked for an analysis of Facilities and Administrative (F&A) funds, because item No. 1 covered that area.
FY03 and FY04 were also removed from all of the items, because the University changed accounting software in the summer of 2004, overhauling the University’s accounting system and making it difficult to reconcile data from the two periods.
Further, the committee removed FY11 from item No. 4, because they said it would be too difficult to predict expenditures on the Rio Rancho campus two years in the future.
Recommended Scope of Work for the Auditor for FY05, FY06, FY07, FY08, FY09 and FY10
Item No. 1
Comparisons of Instructional and General (I&G) expenditures and revenues, broken down into instructional, academic support, student services, institutional support, physical plant any other units who receive them
Item No. 2 (removed)
A detailed analysis of Facilities and Administrative (F&A) revenues and costs sufficient to explain why the Office of the Vice President for Research is in debt
Item No. 3
An analysis of “harvested” funds and where the money was transferred
Item No. 4
An external and internal analysis of how the current operations of the Rio Rancho campus are funded
