UH Today is produced by seniors in the Journalism program at the University of Hawaii at Manoa.

 
 

Auditor's report could affect UH budget requests

By Jenn Boneza

Results from the first phase of the state auditor's report may affect the Legislature's decision to grant the University of Hawaii its supplemental budget requests this legislative session.

Senator and higher education chair Clayton Hee said, “The case made by the auditor is pretty compelling to me,” and “it should give you an indication of what the Senate recommendation is going to be (regarding the university’s request for funds this legislative session).”
           
During a Senate Higher Education briefing held Feb. 7, 2006, State Auditor Marion Higa said UH has inadequate policies and procedures to ensure proper use and monitoring of general and tuition funds. Higa said, “The Manoa campus’s budget lacks the detail and support necessary to ensure the efficient and effective use of resources.”

The systemwide financial audit, which took place June 2005 to October 2005, was initiated because UH did not provide timely financial information to the Legislature for the 2005 legislative session according to the state auditor.
           
Higa sighted four reasons why she believed UH lacked the capacity to properly use funds:

  • May 2003 policies and procedures for the tuition funds remain in draft form.
  • Disbursement procedures for the new web based purchasing and payment processing system, implemented July 2003, have not been included in the university’s Administrative Procedures Manual.
  • Disbursements for small purchases are made without verification of proper approval.
  • Certain purchasing duties are not properly segregated.

In addition, Higa said the university did not promptly provide her with the financial information she requested during the audit, which was the reason the audit was initiated in the first place.

“The Legislature’s repeated requests for budget information and the university’s inability to provide the Legislatures with its funding priorities in a timely manner illustrates our conclusion that the University of Hawaii at Manoa could not sufficiently  justify its budget request to the Legislature,” Higa said.

 UH Chief Financial Officer Howard Todo said the auditor’s claim that UH did not provide funding priorities in a timely manner was false; UH did provide all necessary information according to Todo.

Senate Higher Education Chair Clayton Hee agreed with the auditor’s report and said, “The difficulty has been in ferreting out information from the system.”

Hee said he also had concerns regarding the university’s request for money from the Legislature. Hee added, the problem is there are currently 192 vacant positions the Legislature has already funded and questioned what that money was being used for.
           
“It would seem that money is being used in ways the Legislature did not intend,” Hee said.
Manoa Chancellor Denise Konan said, “I found (the auditor’s report) to echo many of the problems I have been concerned about since I assumed the Chancellorship.”
           
Todo also agreed with some of the auditor’s findings; however he and the chancellor both strongly disagreed with the overall conclusion of the auditor’s report that UH could not ensure fiscal accountability.

Some of the steps the university is taking to resolve issues raised in the auditor’s report are: reestablishing the Manoa Budget Advisory Committee, analyzing base budgets to ensure resources align appropriately with missions, implementing fiscal quality controls and improving communication between fiscal officers.

What: Systemwide financial audit of UH
           
When: June – Oct. 2005

By Whom: Initiated at the request of the Legislature; conducted by State Auditor Marion Higa
           
Why: UH failed to provide timely information to the Legislature during the 2005.

Legislative session, according to the auditor’s report.
           
Findings:

  • UH Manoa’s budget lacks the detail and support necessary to ensure the efficient and effective use of resources.
  • Manoa’s management of its general and tuition funds provides little assurance that the university has an adequate understanding of its overall fiscal condition.
  • The university’s calculation of the Manoa’s campus’s actual cost per student has limited value for decision-making.

           
Overall conclusion:
The budget process and financial system at Manoa does not ensure fiscal accountability.


           
           

© 2005 UHM Journalism program and students.