Opinion: U. of New Mexico Needs Proactive Audit

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Copyright 2017 Albuquerque Journal

Albuquerque Journal (New Mexico)


Whether by design or happenstance, the University of New Mexico's Athletic Department — which operates on an annual budget of roughly $33 million, but owes the university about $4.4 million — has not undergone a comprehensive audit by UNM's internal audit department in at least six years.

Possibly longer.

The audit department has, however, audited: UNM Press; the university president's travel and entertainment expenses (four times, we're told); and cash controls at the Pediatrics Department's bake sales. That random mix is because UNM creates its audit plan from feedback from the individual units — an odd system that amounts to departments admitting shortcomings and asking to be audited — as well as complaints.

Meanwhile, the university's audit department — comprising a total of eight employees, including administrators — has the authority to audit about 1,000 UNM units, such as branches, departments and programs.

It has averaged 9.2 reports per year since 2003.

We understand the challenges of understaffing, as well as the need to address complaints, but to ignore a huge department that has been in the red for seven of the past nine years, and whose principals have made enough questionable financial decisions (Scotland, anyone?) to have triggered investigations by the state Auditor's Office and the state Attorney General's Office just does not add up.

UNM officials cannot, in fact, pinpoint the last time internal auditors took a comprehensive look at the Athletic Department, although they have conducted audits on specific areas within the department. Clearly, nobody in Athletics raised his/her hand and asked for an overall audit.

But shouldn't posting deficits year after fiscal year warrant closer scrutiny and oversight? At minimum, shouldn't such a large and fiscally challenged operation warrant a chief financial officer? (Athletics hasn't had one since last July.)

Interim UNM President Chaouki Abdallah says he thinks UNM has enough safeguards, including processes and internal audit functions, to ensure that Athletics runs a sound financial operation but adds, "You don't know what you don't know."

What we do know is UNM Athletics needs some fiscal discipline. UNM says its internal auditors will work alongside state-level staff on the forthcoming audit, as they should.

The dueling state investigations should provide a playbook of where things have gone wrong, and Abdallah says the university could make changes based on findings. But he doesn't have to wait — UNM should immediately require internal audits of departments that, like Athletics, have shown they can't play by the budget rules.

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July 6, 2017


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