Audit Finds Several Issues with Louisiana State University System
BATON ROUGE (The Center Square) — A recent audit of the Louisiana State University system found a lack of oversight of federal research funding, issues with student loan record keeping, and inadequate controls over federal emergency funding and reporting.
Louisiana Legislative Auditor Mike Waguespack issued a report on May 23 outlining findings from an audit of the Louisiana State University system that examined federal compliance and school finances.
Auditors found that while the system addressed and resolved prior-year findings, new issues with federal monitoring and reporting requirements should be addressed.
The report contends “the Pennington Biomedical Research Center (PBRC) did not adequately monitor subrecipients of the federal Research and Development cluster.
“PBRC did not have adequate controls in place to ensure that required audits were completed within nine months of the subrecipient’s fiscal year-end,” according to the report.
As a result, the PBRC could not provide documentation for two out of 16 subrecipients that showed audits were completed in accordance with federal regulations.
Auditors also discovered Louisiana State University and A&M College (LSU A&M) did not have adequate controls in place to ensure accurate records for the Federal Perkins Loan.
“In a test of 40 LSU A&M active Perkins Loan student files from a population of 2,114 files subject to Perkins Loans recordkeeping and record retention requirements, repayment schedules for 37 (93%), were not maintained in a fireproof safe in accordance with federal regulations,” auditors wrote.
Auditors also found one missing repayment schedule, as well as a lack of required documentation for five of the 40 student files tested. The total number of records was 1,075.
The Louisiana Legislative Auditor also uncovered issues with Higher Education Emergency Relief Fund costs and reporting requirements.
“LSU A&M improperly requested and received reimbursement from the Higher Education Relief Fund for costs totaling $40,847 that did not comply with program requirements,” auditors wrote.
The issue was discovered in a sample of 29 LSU A&M HEERF transactions, taken from a total population of 10,789 transactions.
Issues with HEERF reporting requirements centered on inaccurate quarterly reports and missed deadlines to publicly post the information.
An examination of the LSU system’s financial statements showed “account balances and classes of transactions tested, as adjusted, are materially correct.”
Further financial analysis showed the system’s expenses have increased by 18.8% since 2017, while state appropriations declined by 4.4%. Over the same time period, tuition and fees increased by 18.7% mainly due to enrollment increases, which are up 21.5% since 2017.
LSU officials responded to the audit by promising to strengthen controls over subrecipient monitoring processes at the Pennington Biomedical Research Center, and outlining several improvements to ensure compliance with federal Perkins Loan requirements, including outsourcing servicing.
LSU also refunded the $40,897 to the U.S. Department of Education for the HEERF issue, trained departmental business officers on the program, and added a secondary review to ensure “all revenue loss entries will be performed to ensure compliance with HEERF guidance,” according to a letter from Donna Torres, the system’s vice president for finance.