Minnesota Office of the Legislative Auditor
Financial Audit Division

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Report Summary
Fond du Lac Tribal and Community College

Financial Audit For the Two Fiscal Years
Ended June 30, 1997

 

Public Release Date: July 2, 1998 No. 98-39

Background

Fond du Lac Tribal and Community College began operations in 1987. It operated as part of the Arrowhead Community College Region until June 30, 1995. On July 1,1995, the college began operating independently as part of the Minnesota State Colleges and Universities (MnSCU) when the state merged the community colleges, state universities, and technical colleges. The college finances its operations through student tuition, fees, and state appropriations. It also receives funding from the federal government based on its federal tribal college status. Mr. Lester Jack Briggs has been the college president since its inception.

Our audit scope covered the period from July 1, 1995 through June 30, 1997. We audited general financial management controls, tuition and fees, payroll, supplies and equipment, and grants. We also reviewed the administration of state and federal student financial aid programs for fiscal year 1998.

Selected Audit Areas and Conclusions

Fond du Lac Tribal and Community College operated within its available resources. Generally, the college properly recorded all of its state treasury account activity on the MnSCU and MAPS accounting systems in a timely manner. The college properly accounted for and controlled its local bank accounts and completed bank account reconciliations timely. However, the college did not record all local bank account activity on MnSCU accounting. In addition, the college maintained a duplicative internal accounting system. The college also did not adequately collateralize one of its local bank accounts. Also, access controls to the student information system need improvement and the college had not formalized an agreement with its foundation.

The college designed and implemented controls in the business office and the financial aid office to ensure that assets were safeguarded, transactions authorized, and financial activity accurately reported in the accounting systems. However, the college did not adequately separate duties over continuing education receipts, reconcile tuition reported on MnSCU accounting to MAPS, or verify tuition waivers issued to waivers authorized. The college needs to periodically check inventory to validate the accuracy of its fixed asset records and to safeguard its purchases at time of receipt. The college made an inappropriate payment under the Bureau of Indian Affairs (BIA) grant and did not reimburse the system office for federal workstudy payroll expenditures on a timely basis.

In its response to the audit report, the college agreed with 11 of the 12 findings and is taking corrective action. Although the college acknowledges that certain federal grants are not accounted for on MnSCU accounting, it believes that federal requirements dictate that the accounting activity and business affairs of the Tribal College must be separate.

 

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