Office of the Legislative Auditor - Financial Audit Division

Report Summary

North Hennepin Community College

July 1, 2000, through June 30, 2002

The college made significant improvements in its financial management practices since our last audit report issued in March 2001. North Hennepin Community College has resolved or substantially resolved all of the 12 prior audit findings. The college's internal controls provided reasonable assurance that the college safeguarded assets, properly recorded financial activity in the accounting records, and complied with finance-related legal provisions and management's authorizations. The college also operated within available financial resources. However, we did note areas where the college can improve its operations.

Key Findings and Recommendations:

• The college did not resolve certain errors in the accounting system in a timely manner. We recommended that the college correct the known accounting system errors and, when necessary, work with the Office of the Chancellor to resolve other reconciling issues.
• The college did not separate the payroll data entry and review functions. We recommended that an independent individual review the payroll register.
• The college did not consistently encumber funds prior to making an obligation. We recommended that the college comply with board procedure by encumbering funds prior to making an obligation.

North Hennepin Community College is part of the Minnesota State Colleges and Universities (MnSCU) system. This financial-related audit report focused on financial management, tuition and fees, employee and student payroll, enterprise activities, and other administrative expenditures for the period from July 1, 2000, through June 30, 2002.