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Mike Nowatzki, Forum News Service, Published January 21 2014

Williston State, university system addressing audit's bookkeeping concerns

BISMARCK – The North Dakota University System and Williston State College are taking steps to address bookkeeping concerns raised by state auditors, but limited staffing and high turnover rates are slowing their progress, a system official told lawmakers Tuesday.

The most recent system audit for the year ended June 30, 2012, identified several internal control matters that needed correcting.

State auditors also found “a lack of efficiency in financial operations and management” of the system, in part because it hadn’t implemented six of the 12 recommendations from prior audits.

Williston State College was singled out by auditors, who noted “numerous classification, coding and reconciliation problems” with its accounting procedures, resulting in misstated financials.

“In our opinion, the problems are largely due to excessive turnover and a general lack of training,” the audit stated.

Laura Glatt, the system’s vice chancellor for administrative affairs, appeared Tuesday before the interim Legislative Audit and Fiscal Review Committee, outlining a number of measures being taken by the system and Williston State to address auditors’ concerns.

The system now provides annual training for system and campus controllers, with 50 attendees last year, Glatt said. It also launched a formal mentoring program last year for new controllers, in part because of the high turnover rate, she said.

Campuses are sharing their accounting processes and procedures, and the system hired an outside firm last year to provide part-time assistance with financial statements, she said.

Other measures have included a systemwide risk assessment, more training and the addition of a system chief compliance officer, Kirsten Franzen.

At Williston State, President Ray Nadolny has made fiscal accountability a priority, hiring a full-time controller, a chief financial officer and a director of finance last year to reconcile the college’s books, Glatt said.

“And I’m glad to say they are getting very close to having those reconciled,” she said.

The committee’s chairman, Rep. Gary Kreidt, R-New Salem, asked if turnover was still a problem at Williston State. Glatt said it was, but that it “has slowed a little.”

Larry Skogen, the system’s interim chancellor, informed the committee that the internal audit staff at North Dakota State University and the University of North Dakota are now reporting directly to the system office – a move directed by the Legislature last spring in the wake of a July 2012 state auditor’s report that found that UND and NDSU had misspent some of the millions of dollars they had collected through student fees. The campus auditors now report to the system’s chief auditor, Tim Carlson, who reports directly to the state Board of Higher Education.

Glatt said the system is working with the state auditor’s office to finalize the fiscal year 2013 audit.

State Auditor Bob Peterson said that while addressing some of the concerns raised by state auditors will be challenging, he believes the system will get there.

“I think the interim chancellor has made a real effort to address those issues,” he said.