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3.10.5     The institution maintains financial control over externally funded or sponsored research and programs. (Control of sponsored research/external funds)

  ✔    Compliance             Partial          Non-Compliance

Summary

Fayetteville Technical Community College (FTCC) is in compliance with this comprehensive standard.  FTCC maintains financial control over all externally funded programs.  Regardless of funding sources, all financial transactions follow the same FTCC purchasing guidelines and Cash Management Plan.  Each externally funded program is individually accounted for to track budgets, revenues, expenses, and encumbrances.  Financial reports are provided to the appropriate grantors and budget managers. 

FTCC is not a research institution; therefore, that aspect of the standard does not apply to FTCC.

Narrative

FTCC maintains financial control over externally funded programs including grants, loans, and scholarships. These programs follow the published FTCC financial Cash Management Plan and, if applicable, published FTCC purchasing guidelines.  The Code of Federal Regulations (CFR) and/or published FTCC Financial Aid Policies and Procedures Manual govern externally funded financial aid grants, loans, and scholarships.   The grantor may specify additional guidelines. FTCC follows all rules, regulations, and guidelines regarding externally funded programs.

All financial activities follow the same budgetary and financial controls regardless of funding sources.  Externally funded grants, scholarships, and loans are individually accounted for and have a unique general ledger fund.  Each fund tracks the assets, liabilities, revenues, and expenses for an individual grant, scholarship, or loan.  All transactions are recorded in Datatel, the College’s accounting system.  Financial reports are provided to the appropriate budget manager and granting agencies.

The Vice President (VP) for Business and Finance, Controller, Director of Budgets and Financial Systems, and Accounting Manager have managerial control over the receipt, disbursement, recording, and reporting of external program funds.  Each of these individuals is fully qualified as indicated on the Excel spreadsheet entitled Credentials – Office of Business and Finance.  The Director of Financial Aid and the Assistant Director of Financial Aid have managerial control over the awarding of external financial aid funds.  Both individuals are fully qualified as indicated on the Excel spreadsheet entitled Credentials – Financial Aid Office. 

FTCC’s grant and scholarship funds fall into two categories.  The first category includes Federal Title IV financial aid grant and loan funds, State funded financial aid grants and scholarships, and institutionally funded financial aid grants and scholarships. The second category of grants and scholarships includes all other non-financial aid grants. For purposes of illustrating financial control and timely submission of appropriate reports related to the College’s external funds, one grant or scholarship has been selected from each of the two categories listed above. Financial controls are in place for both category one and category two for external funding sources.

The Office of the State Auditor (OSA) performed FTCC’s most recent audits during fiscal year 2008-09.  No audit findings were cited in the 2008-09 audit report.  The College was not audited for fiscal year 2007-08.  Previous to fiscal year 2001-02, OSA performed annual audits of the College’s financial statements.  Community colleges are currently audited every other year, unless the auditors uncover issues that they believe warrant annual audits. The College’s 2006-07 financial statement audit did not include audit findings related to externally funded grants or scholarships.  In addition to the regular financial statement audit, OSA selected FTCC Federal Title IV funds as part of the testing necessary to obtain adequate coverage to issue an opinion on the State’s compliance with Federal regulations in 2006-07.  Auditors issued a management letter in January 2008 for this audit.  The audit findings were presented to the College’s Board of Trustees at the March 2008 meeting.

The College’s Title IV compliance audit management letter revealed three audit findings for the 2006-07 fiscal year.  Two of the findings did not result in questioned costs.  In the third finding, auditors reported “likely questioned costs estimated to exceed $10,000."  The College responded to all of the audit issues.  As a result, OSA only included two of the audit findings in the Statewide Single Audit Report. 

The Department of Education responded by letter on October 3, 2008, and closed both of the College’s Single Audit findings.  Based on documentation submitted by the College in response to the finding that questioned costs in excess of $10,000, FTCC was found in fault of over-awarding one student by $576.00.  This amount was refunded to the Department of Education on November 12, 2008. 

OSA has since followed up on all three of the audit findings reported in January 2008 and has concluded that FTCC has resolved all of the audit issues.  Documentation of OSA’s Summary Schedule of Prior Year Audit Findings can be found in the 2008 Statewide Single Audit Report.  The two findings are mentioned in several locations in the report as prior-year audit findings.  In all instances, the current status of the findings is “full corrective action has been taken," indicated as follows:  page 418, page 426, and page 428. 

Supporting Documentation

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