SA auditors discover $9.6K missing from organization
An unaccounted-for withdrawal of $9,600 was discovered during a financial review of Student Association finances – just one of several deficiencies highlighted by the organization’s independent auditors this past week.
The withdrawal from an investment account came to light in January 2018 during an audit of the 2017 fiscal year by UHY, an independent auditing company hired by SA to review its finances.
SA’s fiscal year spans from July 1 and ends June 30 the following year.
The withdrawal was discovered the same time a grand larceny in the third degree involving missing funds from SA was reported to UPD.
“When testing the investment balance, we noted a discrepancy and when we noted that discrepancy we informed management, who turned it over to the University Police Department,” said Michael Zovistoski, one of UHY’s auditors, who explained that management included the SA president and University Auxiliary Services who took custodianship of SA finances on July 1, 2017.
UPD declined to comment, citing an ongoing investigation into the missing funds.
Jordan Carleo-Evangelist, university director of media and community relations, confirmed the general timeline of events.
SA President Jerlisa Fontaine did not respond to multiple requests for comment.
The unaccounted-for transaction was just one of several deficiencies discovered by UHY during the 2017 fiscal year.
A majority of bank reconciliations for the year went unperformed, credit card approval requests were not always made available to support card usage, and several significant expenditures were not formally approved through SA’s required approval process. Numerous checks and wire transfers were also written and conducted without proper approval.
According to SA’s Treasurer Handbook, all purchase requests and credit card usage must be approved in advance by the comptroller’s office and any receipts must be submitted to the office before a student group is reimbursed for any expenditure.
Not following this process, according to the auditors, could lead to inappropriate expenditures.
In addition, auditors discovered old outstanding checks that continue to be carried on the books and no formal approval and review process for tracking vacation times and accruals for staff members.
“We’ve been told for a long time that this is the reality,” said Jarrett Altilio, senate chair. “But seeing it on paper delivered to us is a whole other story.”
After failing to keep up with the reconciliation process throughout the year, which led to delays in the auditing process, UAS took custodianship over SA’s finances this past summer.
“The University fully agrees that students have a right to know how their money is being spent,” said Carleo-Evangelist in a statement. “That is why the University strongly advocated for the inclusion of University Auxiliary Services in this process as SA’s fiscal agent, and we are confident that the 2017-18 SA audit will reflect this more robust oversight.”
According to Patrick Carroll, SA deputy comptroller, problems with the reconciliation process stem from a lack of staff in the comptroller’s office. Carroll is just one of three full-time employees who works in the office.
“This office has always been short staffed,” said Carroll who explained overseeing a $2.6 million budget is a lot to manage for the small staff made up of full-time students. “I think the resources this office is getting doesn’t always reflect the work that is required from this office.”
UHY auditors recommended hiring a full-time financial manager to create a better sense of continuity within the organization from year-to-year, an idea proposed by Carroll during his failed SA vice-presidential bid earlier this year and since echoed by Altilio.
“I think a lot of the problem has been solved by us using UAS,” said Altilio. “But that doesn’t negate the fact that there could be merit or benefit to having…that consistency of somebody who is working there and has the knowledge.”