UConn management torched in new audit report: credentials of prospective employees are not being reviewed

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Here are the recommendations of the state Auditors of Public Accounts, who just released a review of 2010 and 2011 at the state’s flagship basketball academy/higher education institution. Boldfacing was done by the Blogster. Really: contractor work beginning on projects before actual contracts are finalized? Whoa! The credentials of prospective employees are not being checked? Really? In 2014?

“Current Audit Recommendations:
1. The University of Connecticut should establish maximum salaries for all professional employees, through the collective bargaining process if necessary. The maximum salaries should not be exceeded for new hires or existing employees without specific board approval.
Comment:
Normally, state employees are paid in accordance with established salary schedules. Once
the employees reach the maximum salary for their positions, their base salaries only
increase when the salary schedules are adjusted for inflation. However, maximum rates of
pay have not been established for professional employees at UConn. The compensation
levels of university professional employees can increase indefinitely.
2. The University of Connecticut should seek clear statutory authority for the direct
payment of wages to its food service operations employees and for their participation
in separate retirement plans.
Comment:
Section 3-25 of the General Statues authorizes constituent units of the state system of
higher education to pay certain claims directly, rather than through the State Comptroller.
However, Section 3-25 specifically excludes payments for payroll. Unlike other UConn
employees, food service operations employees are paid directly by the university instead of
through the State Comptroller. They also participate in separate retirement plans, although
there is no clear statutory authority for this.
3. The University of Connecticut should establish procedures for verifying the representations of job candidates regarding their work experience and professional credentials. The procedures should clearly assign responsibility for the task and be sufficient to provide adequate assurance.
Comment:
In spring 2012, we reviewed 40 instances in which individuals were appointed to new
positions (new hires, promotions and transfers). We found that UConn did not appear to be obtaining adequate assurance regarding the accuracy of the claims made by job candidates
concerning their work experience and professional credentials.
4. The University of Connecticut should expand its review of payments made for
accrued compensated absences during the fiscal year ended June 30, 2010, to prior
periods.
Comment:
We noted a significant error rate in payments made for accrued compensated absences,
starting with our audit of the fiscal years ended June 30, 2006 and 2007. UConn recently
reviewed payments made during the fiscal year ended June 30, 2010, but did not review
those made during prior periods.
5. The University of Connecticut should determine the feasibility of recovering Social
Security taxes paid that, under the HIRE Act, it was not required to pay.
Comment:
The Hiring Incentives to Restore Employment (HIRE) Act, enacted March 18, 2010,
provided employers with an exemption from the employer’s 6.2 percent share of social
security tax on wages paid to qualifying employees, effective for wages paid from March
19, 2010 through December 31, 2010. UConn did not take advantage of these provisions of
the HIRE Act.
6. The University of Connecticut should track voluntary uncommitted cost sharing in its
time and effort reporting system.
Comment:
The use of unrestricted UConn resources for sponsored research is in keeping with the
university’s goal of recognition as one of the nation’s top-20 public research universities.
However, without effective monitoring of the amount of unrestricted university resources
directed to sponsored research projects by researchers, the university cannot reasonably
estimate the concomitant costs and determine whether the amount used is appropriate.
7. The University of Connecticut should conduct a formal, well documented, selection
process for all major acquisitions. Every functional area that will be significantly
affected should have adequate representation and input into the process.
Comment:
UConn did not adequately document the selection of its new financial system. We could
not find any indication of a feature-by-feature comparison of competing products or any
evidence that any systems other than PeopleSoft or Banner were considered. Furthermore,
the initial selection process appeared to have been driven solely by the UConn core financial management and staff. We found no evidence of significant input from the wider
university community.
8. The University of Connecticut should develop a structured methodology for major
software implementation projects. All projects should be approved by the board of
trustees before they are initiated.
Comment:
The successful implementation of the new financial system is a tribute to the efforts of the
Kuali implementation team. However, UConn incurred risks that could have been avoided
with a more deliberate approach that combined a more comprehensive risk assessment and
mitigation process with the development of a more detailed control framework.
9. The University of Connecticut should implement an ongoing risk assessment and
mitigation process, and prepare a business continuity and disaster recovery plan. The
plan should be continuously updated, taking into consideration changes in the systems
and resources available to address potential risks.
Comment:
In our prior report, we noted that, as of June 2011, the UConn Information Technology
Services Department, which maintains the university’s core systems, did not have an
updated disaster recovery plan on file. We followed up on this issue in December 2012. We
found UConn had engaged a consultant to begin the process of implementing an ongoing
risk assessment and mitigation process and preparing a business continuity and disaster
recovery plan. However, it appeared that no significant progress had been made.
10. The University of Connecticut should make certain improvements to physical and
logical information technology system access controls.
Comment:
We noted control weaknesses that need to be addressed. The UConn internal audit unit also
reported access control issues.
11. The University of Connecticut should require that purchasing card logs be approved
by a staff member with supervisory authority over the cardholder.
Comment:
We reviewed 25 purchasing card logs. We found that, with respect to 20 of the 25 logs
reviewed, the record managers signing off on the logs were co-workers, subordinates,
lower level staff or the cardholders themselves.
12. The University of Connecticut should not authorize contractors to begin work before
contracts are executed.
Comment:
We have repeatedly noted instances in which contracts were executed after work began.
For example, during our testing of a sample of fiscal year 2010-2011 expenditures, we
noted 14 instances in which contracts were executed by the university after the contractual
start date. Delays ranged from 18 days to 10 months; contract amounts ranged from
$12,000 to $1,391,137.
13. The University of Connecticut should prepare receiving reports when payment is
required prior to a performance to document that the vendor has fulfilled its
contractual obligations.
Comment:
On August 16, 2010, UConn contracted with Columbia Artists Management LLC for a
performance to be given on November 9, 2010, in the amount of $23,375. The check was
issued in advance, as is common for this type of transaction. Staff did not prepare,
subsequent to the event, a receiving report to document that the vendor had fulfilled its
contractual obligations.
14. The University of Connecticut should process all procurement transactions through
the purchasing department to ensure they are reviewed by staff familiar with the
relevant state requirements.
Comment:
During our testing of expenditures of the 2009-2010, 2010-2011 and 2011-2012 fiscal
years, we found that the required certifications were not obtained for purchases of library
materials. During our testing of expenditures of the 2011-2012 fiscal year, we found that
the required certifications were not obtained for other purchases that were also handled at
the department level, rather than processed through the purchasing department.
15. The University of Connecticut should develop a comprehensive, ongoing process for
identifying all independent entities carrying out operations on university property,
and monitoring to verify that appropriate written agreements are in place.
Comment:
Many aspects of UConn operations are decentralized. However, a certain level of central
control over independent entities carrying out operations on university property is needed.
Management must be able to monitor these activities and verify that the proper safeguards are in place. A comprehensive, ongoing process for identifying all such entities is a
necessary first step.”

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