Sam Houston State University (SHSU) exercises appropriate control over all its financial resources. The Vice President for Finance and Operations is the chief financial officer and has the primary responsibility for maintaining control over the University’s financial resources [1] [2]. The Vice President establishes policies, communicates policies, and monitors adherence to such policies, thereby ensuring appropriate management and control of all financial resources. The Organizational Chart for the Division of Finance and Operations outlines the University’s structure and personnel who are delegated to manage the institution’s financial resources [3].
The Vice President for Finance and Operations supervises the following departments, which share the responsibility for monitoring controls in their areas. The following areas are overseen by the Associate Vice President for Finance and Operations [4] [5]: Disbursements & Travel Services [6] [7], Controllers Office [8] [9], Payroll Services [10] [11], and Procurement and Business Services [12] [13]. The following areas are overseen directly by the Vice President for Finance and Operations: Human Resources [14] [15], Bursar’s Office [16] [17], Treasurer [18] [19], and Facilities Management [20] [21].
Administrators in all of the above-named departments are responsible for monitoring controls in their areas, taking corrective action when controls are threatened, and reporting violations to their appropriate Associate Vice President or to the Vice President of Finance and Operations when those violations are not corrected. The job descriptions and résumés of the responsible managers provided within the support documentation demonstrate that these managers meet the qualifications for the positions they hold and that their job descriptions require a sufficient level of expertise to fulfill their monitoring duties. Prior to hiring an individual, a criminal background check is performed, and credentials and transcripts are required to ensure that the individual is qualified to fill the position.
Cash Handling
Cash, check, and point of sale (POS) credit card payments collected for the University are routed through the Bursar’s Office. Funds collected at the departmental level are entered into an electronic deposit system so funds can be tracked. Funds accepted electronically through the University’s online system are transferred in nightly batches to the University’s ERP system. The Bursar’s Office is equipped with a fireproof safe, electronic monitoring equipment, panic alarms, and exterior alarms. Internal procedure controls and computer access controls separate the collection of payment from the recording of charges. Individuals who accept funds and post payments do not post charges and vice versa. Each Customer Service Representative (CSR) has a separate cash drawer, which is balanced daily. Supervisors performs random cash counts and periodic audits of cash drawers.
Checks are electronically deposited daily to the University’s primary depository bank, Wells Fargo. Checks which cannot be electronically deposited and cash are deposited daily to the University’s local depository, First National Bank in Huntsville, Texas. Deposits are delivered to the First National Bank Night Depository by University police at the close of each business day. All funds are transported in a locked bag [22]. Neither the officer nor the bank has a key to the bag. The next business day, a CSR goes to the bank, unlocks the bag, observes the cash count and deposit submission, and then locks the bank bag(s). This process may include a return of cash in the locked bag to the University. A University policer officer picks up the locked bag and returns it to the Bursar’s Office upon the completion of the daily deposit process.
Due to hours of operation and location of the operation, funds collected by Raven Nest Golf Course are transported directly to the First National Bank night depository at the end of each business day instead of being routed directly to the Bursar’s Office. Funds are transported by University police in locked bank bags. Neither the officer nor the bank has keys to the bags. Raven Nest deposit bags are collected the next business day with the other deposit bags and are delivered to the Bursar’s Office for processing.
Monitoring Purchase Orders, Expenditures, and Payroll
The first step in initiating an expenditure is preparing a document to request that expense. The document is in the form of a travel application, purchase order, payroll action form, or direct pay. The administrative departments review documents to determine the appropriateness of the expenditure and the source of funds [23].
Prior to the beginning of each fiscal year, the Texas State University System (TSUS) Board of Regents approves the SHSU Budget [24] [25] [26] for that year. Each budget is prepared in accordance with the SHSU Budget Procedures and Guidelines [27]. At the beginning of the year, the budget information is loaded into the SHSU general ledger. Computer programs used for data entry into the general ledger have controls built in which will not allow an encumbrance, an expenditure, or a payroll action form to be posted if sufficient funds are not available to cover that cost. Throughout the year budget adjustments are made and approved by the TSUS Board of Regents at their quarterly meetings [28].
Online, real-time reports are available to each account manager [29]. These reports may be viewed online or printed to assure that each manager has the most up-to-date information available. Controller, Payroll, Human Resources, and Procurement and Business Services offer training classes periodically to assist employees in using the financial system correctly and effectively.
Purchasing policies guide employees in the proper procedures to use when procuring goods and services [30]. These policies are in accordance with statute and TSUS Rules and Regulations [31].
Contracts
Chapter III, Section 1, which details items requiring board approval [32] and includes contract signature authority. Some contracts must go to the TSUS Board of Regents for approval regardless of the amount. The University President may sign contracts up to $499,999 without further approval, unless otherwise prohibited by TSUS policy. Chapter III, Section 10 further provides guidance on contract signature authority [33]. This policy stipulates that each year the President may delegate signature authority to other University personnel and that the authority must be specific and in writing.
Endowments
The TSUS Board of Regents has granted authority to each component president to establish monetary levels for permanent endowments [34]. The University Advancement Office accepts gifts on behalf of the University and negotiates the terms of the agreements. The University Advancement website discusses the various types of endowments and the required monetary level of each [35]. Chapter III, Section 1.12 of TSUS Rules and Regulations establishes guidelines for accepting and reporting gifts to the board [36].
Investments
SHSU holds a diversified investment portfolio including bank deposits, short-intermediate funds, and long-term funds. The Vice President for Finance and Operations is the Investment Officer for SHSU. The Treasurer’s Office maintains adequate liquidity and monitors all investment accounts. The Summary of Investments for the period ending February 28, 2018, is presented for review [37]. Chapter III, Section 6.75 of the TSUS Rules and Regulations [38] requires a quarterly report of investments as prescribed by the TSUS Investment Policy [39].
Audits
SHSU’s Internal Audit Department reports directly to the TSUS Director of Audits and Analysis [40] [41]. Chapter III, Section 7 of TSUS Rules and Regulations describes the Internal Audit function, responsibilities, and reporting structure [42]. The SHSU Director of Internal Audit conducts an annual Audit Plan and Risk Assessment [43] as required by the TSUS Board of Regents. Departments and activities are audited based on the risk assessment to ensure that controls are in place and working.