Minnesota Office of the Legislative Auditor
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Report Summary
Inver Hills Community College

Financial Audit For the Period July 1, 1995, through June 30, 1997

 

Public Release Date: November 6, 1997 No. 97-54

Background Information

Inver Hills Community College is part of the Minnesota State Colleges and Universities System (MnSCU). MnSCU began operations on July 1, 1995, when the state universities, community colleges, and technical colleges throughout the state merged under one governance structure. Inver Hills Community College is a two-year college. Dr. Steven Wallace served as president of the college until July 1997. Dr. Cheryl Frank is currently serving as acting president.

Objectives and Conclusions

The objectives of our audit were to gain an understanding of the internal control structure over the accounting and reporting of financial activities of the college and to determine if the college complied with material finance-related legal provisions. The areas covered by our audit were tuition, payroll, bookstore revenues and expenditures, and student financial aid for the period July 1, 1995, through June 30, 1997.

We concluded that Inver Hills Community College operated within its available resources and generally operated in compliance with management's authorization and applicable legal requirements for the items tested, including federal student financial aid regulations. Overall, the college designed and implemented internal controls to provide reasonable assurance that its financial activities were properly accounted for and accurately recorded on the accounting systems. The college did not, however, enter certain financial transactions into the MnSCU accounting system correctly, reconcile local bank accounts to MnSCU accounting on a timely basis, and did not delete system access for some former employees. We also determined the college's Foundation was not subject to an audit as required by the agreement with the school.

Other findings discussed in the audit report included improving controls over tuition and bookstore receipts, improving the separation of duties over payroll functions, and verifying the accuracy of payroll transactions. We also recommended that the transfer of bookstore profits to the college's General Fund should be based on a rational and systematic basis. In our review of federal financial aid, we found one overpayment.

Inver Hills Community College concurred with the audit report's findings and recommendations. The college indicated that it has already taken corrective action on several areas as explained in their response.

 

Office of the Legislative Auditor ♦ Room 140, 658 Cedar St., St. Paul, MN 55155