Section 3.10.4: Financial and Physical Resources

Judgment of Compliance

Requirement

The institution exercises appropriate control over all its financial and physical resources.

Narrative

McNeese State University is in compliance with Comprehensive Standard 3.10.4.

Control of Financial Resources

McNeese State University has a comprehensive accounting, financial reporting, and budgetary control system. It begins with the budget process when the Budget Officer prepares and sends worksheets to all department heads and directors, who then list their budgetary needs and return the worksheets to the Budget Officer. The Budget Officer then prepares these requests for the Executive Staff’s review. The Executive Staff, which consists of the University President, all Vice-Presidents, Chief Information Technology Officer, and Director of Institutional Effectiveness develop the budget based upon a review of the information contained in the worksheets. The final budget is then submitted to the Louisiana Board of Supervisors, the Louisiana Legislature, and the Louisiana Board of Regents.

The University had used SCT’s Financial Record System (FRS) for the purpose of accounting and budgetary control up until July of 2005, at which time a conversion was made to the finance module software offered by Banner. This new program allows the Budget Officer to enter a budget for each department, which can be accessed online by that department head. When requisitions are entered into the system, a built-in control system requires that a validation is signed off by the department head and that a verification of available funds is made. If funds are not available, then the department must make a request to the Budget Officer to amend the budget. Account information is available electronically, which allows the department real time access to its accounts.

In January of 2005, the University began using the Banner Human Resource System module to run payroll. The checks and balances within this system allow for greater control of personnel expenses. Plans are for a comprehensive student information module to go online in the summer of 2007.

Another method of checks and balances is the work performed by the Internal Auditor. The Internal Auditor reports directly to the University President on all administrative matters and reports directly to the University of Louisiana System Director of Internal Audit concerning all audit matters. This arrangement provides the office of Internal Auditor with an necessary autonomy. It is the responsibility of this office to conduct routine audits and reviews of campus operations, focusing primarily on internal control and managerial functions. The Internal Auditor prepares an Annual Audit Plan. Documentation of internal audits and reviews can be found in the Office of Internal Audit. These documents have been reviewed by the Legislative Auditor as a part of their audit.

The University conducts an annual inventory process in order to maintain control over all movable property, adequately insure items, and to accurately reflect these cost items on the financial statement. The Coordinator of Property Control, who reports to the Director of Purchasing, sends each campus department a hard copy of their physical inventory with instructions on how to conduct the inventory. Every item valued over $1,000 and all weapons and security items are listed on the inventory. Results are compiled and submitted to the Louisiana Property Assistance Agency and maintained on file in the Property Control Office.

The Director of Purchasing and Property reports to the Vice-President for Business Affairs. Purchasing and property control regulations can be found on the university’s website. The university is insured by the Louisiana Office of Risk Management and the Office of Purchasing reports on property and building expense, contents, and general liability while the Comptroller’s Office reports on Bond and Crime exposure and Business Interruption Expense.

McNeese State University financial statements are prepared and submitted annually to the University of Louisiana System (ULS). The Office of the Legislative Auditor audits the ULS annually, and as part of the ULS audit, tests financial records of McNeese State University biennially.

Following the 2002 and 2003 fiscal year audit, the Legislative Auditor issued a Management Letter dated December 22, 2003, in which only one finding was noted. McNeese had not submitted a written record retention schedule to the Secretary of State. This oversight was corrected immediately.

Following the fiscal year 2005, audit two findings were listed in the Legislative Auditor’s management letter dated March 8, 2006. The auditor found that McNeese did not have sufficient controls to ensure that the request and disbursement of the Federal Family Education Loans were performed in compliance with program regulations.

McNeese has established these controls by having University Computing Services write and implement a new computer program to ensure that first-time freshman and/or first-time borrowers do not receive the FFEL funds prior to 30 days after the first day of the student’s program of study.

The second finding referred to the University not having adequate internal controls to ensure that movable property is reported to the Louisiana Property Assistance Agency in accordance with state movable property regulations. McNeese has since adopted internal control procedures to ensure that acquisitions of qualified property are appropriately tagged and entered into the LPPA system within 60 days of receipt. The university also adopted additional internal control procedures to reduce the amount of unaccounted for property.

The University administration considers all requests to modify, renovate, add to or build new facilities. Requests generally come from Deans and Department Heads. Their needs are justified by internal documentation and by a report generated by the Board of Regents yearly and referred to as “Availability and Utilization as Compared to Louisiana Public Colleges and Universities.”

Requirements for accreditation for individual programs and Fire Marshal inspections can often dictate the need for certain facilities which in turn can call for the requirement to make facility modifications. Exterior modifications and maintenance to the campus landscaping is accomplished by the Grounds Department. Modifications are generally decided through the cooperation of Facilities and Plant Operations and Grounds Department with a great deal of input from the President.

The University is currently in the process of developing a “Master Landscaping Plan,” which will be used to further develop the University’s landscape. The plan will be applied throughout the entire campus. This plan was paid through the Campus Development Committee. This committee was formed through a student self-assessment to be used for beautification of the campus and other worthwhile projects approved by this student/faculty/staff committee. All projects must be finally approved by the President of the University.

McNeese State University has developed policies and procedures to allow use of campus/facilities by non-university groups. Policies are established and reviewed by a Facilities Use Committee and the Internal Auditor and chaired by the Vice-President for Business Affairs with a cross-section of campus administrators and staff. Policies are established to ensure that use of facilities by non-university entities does not conflict with the University mission and does not create an atmosphere for unfair competitions between the University and the private sector.

The Facilities Use Policy can be reviewed on the University’s web-site and hard copies obtained through the Student Services Department. McNeese State University updates on a yearly basis per state law all facilities and land holdings to a state-wide consolidated inventory system known as the “Statewide Land and Buildings Systems Agency Land and Building Report.”

Since 1993, the Louisiana Legislature has provided to Public Universities funding for Major Repairs and Deferred Maintenance on Campus Buildings.” These following improvements to safety and careful stewardship of resources have been funded in this manner:

• Life Safety

• Code Compliance

• Repairs to critical systems in danger of failing

• Repairs that extend the useful life of campus facilities

• Energy conservation

• ADA compliance.

A complete list of project funding since 1993 can be found under Major Repairs and Deferred Maintenance on Campus Buildings. Additional information concerning levels of spending may be found in Comprehensive Standard 3.10.7.

With the assistance of Facility Planning and Control under the Division of Administration for the State of Louisiana, the University has also created a data base which identifies, prioritizes and estimates remaining life expectancy for every building on the McNeese campuses. This data base has a very detailed breakdown of systems and finishes giving cost data so the University and State can better determine future needs and extent of capital expenditure needed for their physical assets.

State Law and policies of Facility Planning and the Board of Supervisors for the University of Louisiana System all request for Capital Outlay for renovations and new projects above $350,000.00 are included in an annual request. Capital Outlay request for McNeese State University for the past several years can be viewed in detailed for 2005-2006 Capital Outlay Request, 2004-2005 Capital Outlay Request, 2003-2004 Capital Outlay Request.

The Physical Plant maintains campus facilities according to best practices and standards. The Physical Plant provides preventive maintenance through outside laboratories and experts to predict problems in critical facility systems so that corrective action can be taken prior to failure. The Preventive Maintenance Program or Equipment Management Program is audited along with many other items by the State of Louisiana Office of Risk Management. Audit reports are available for ORM Audit 2003-2004, ORM Audit 2002-2003 and ORM Audit 2001-2002. The Physical Plant is responsible for the maintenance and inspection of numerous elements of the campus on a weekly, monthly, bi-annual and annual basis following a list of some of the more crucial items: Vehicle Use and Maintenance; Underground Tank Maintenance and Inspection; Underground Gas Pipeline; and Master Meter Site Lighting

The Physical Plant is also responsible for coordinating all official University Travel, Key Control, and the Maintenance Work Order System. Building inspections are accomplished through the Building Coordinators before forwarding to the appropriate department for action. Building Coordinators inspect each building quarterly for safety and maintenance problems and record them in a Building Condition Report. Building Condition inspection is part of the Risk Management Program audited by the State of Louisiana Office of Risk Management. Audit reports can be found for ORM Audit 2003-2004, ORM Audit 2002-2003, and ORM Audit 2001- 2002.

General Safety Programs are referenced in the Loss Prevention Manual and comes under the direction of the Office of Environmental Health, Safety and Hazardous Waste with guidance in some instances from the University Safety Committee. The Safety Plan or Loss Prevention Plan is audited yearly by the State of Louisiana Office of Risk Management. Requirements for compliance with the Office of Risk Management regulations and activities to promote campus safety are posted and outlined on the Office of Environmental Health, Safety and Hazardous Waste web site. All employees are required to participate in quarterly safety meetings. This

Supporting Evidence

Annual Audit Plan

Management Letter from Legislative Auditor March 8, 2006

Legislative Auditor Audit Report June 30, 2001

Legislative Auditor Management Letter June 30, 2003