Audit of the University of Massachusetts Lowell
June 12, 2018 · University of Massachusetts Lowell · Read the full official report on mass.gov ↗
Published June 12, 2018 Audit covers July 1, 2014 – June 30, 2016 Under Suzanne M. Bump · 2011–2023
source
“UMass Lowell did not properly administer its inventory of fixed assets.”
Read the plain-English breakdown
This is a state performance audit of certain UMass Lowell activities during July 1, 2014 through June 30, 2016.
“In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor has conducted a performance audit of certain activities of the University of Massachusetts (UMass) Lowell for the period July 1, 2014 through June 30, 2016.”
Auditors looked at how UMass Lowell handled fixed assets, procurement-card spending, and some services for students covered by disability-rights law.
“In this performance audit, we examined certain UMass Lowell activities related to the inventory of fixed assets, certain expenditures made with the university’s procurement cards (ProCards), and the administration of certain services for students who are covered under the Americans with Disabilities Act of 1990.”
If inventory records are incomplete or late, expensive university property can be harder to track and easier to lose, misuse, or steal without detection.
“As a result, there is a higher-than-acceptable risk of undetected theft or misuse of these fixed assets or that it may not be possible to find some items.”
For taxpayers, students, and families, this matters because UMass Lowell used public resources and spent about $13.5 million through procurement cards during the audit period.
“During the audit period, there were 1,257 ProCards used by university department heads and other authorized employees to purchase approximately $13.5 million of goods and services directly.”
The auditor concluded that UMass Lowell did not properly administer fixed assets or ProCards, but did meet the ADA-related items the audit tested.
“Does UMass Lowell properly administer the use of procurement cards (ProCards) in terms of ensuring that all expenses paid using university credit cards are properly approved and documented?”
The report recommends weekly inventory checks, fixing missing asset information, and clearer ProCard supervision rules and training.
“UMass Lowell should enhance its policies to better define supervisory activities and should provide additional training to supervisors regarding their timely completion of their ProCard responsibilities, if needed.”
The findings point to weak controls: property records were not reliably updated, and 31 sampled ProCard logs were approved despite missing required information or documentation.
“Our sample3 of procurement card (ProCard) activity logs identified 31 logs that were improperly approved.”
A ProCard is a university purchasing card used for routine business expenses; fixed assets are things like computer equipment, automobiles, and some lab equipment; ADA refers to federal protections for people with disabilities.
“The use of the card simplifies the purchasing process for routine expenditures.”
2 figure(s) pending source verification - not shown
What the Auditor checked
- Did not comply Does UMass Lowell properly administer its inventory of fixed assets?
- Did not comply Does UMass Lowell properly administer the use of procurement cards (ProCards) in terms of ensuring that all expenses paid using university credit cards are properly approved and documented?
- Complied Has UMass Lowell developed an emergency evacuation plan that takes into account the needs of students with mobility-related disabilities?
- Complied Has UMass Lowell taken appropriate measures to ensure that students with disabilities have access to supplemental learning aids, services, and alternative learning and testing formats in a timely manner?
What the Auditor found
Why it matters: There was a higher-than-acceptable risk of undetected theft or misuse of fixed assets, or that some items could not be found.
Standard: UMass Lowell's Internal Control Manual requires weekly transfer and review of asset purchases in PeopleSoft and recording of pertinent information. ( UMass Lowell's Internal Control Manual )
3 recommendations
- UMass Lowell should review the Staging Table Report weekly to ensure that assets are properly recorded.agency: partially agreed
- UMass Lowell should review its fixed asset inventory list and ensure that all required information is present.agency: disagreed
- UMass Lowell should determine why information may be missing from PeopleSoft and correct the issue as needed.agency: disagreed
Agency response & Auditor reply
Agency: "Although some exceptions were noted, UMass Lowell properly administers the asset inventory in accordance with policy."
Auditor: "We found that UMass Lowell did not properly administer its inventory of fixed assets in that it did not ensure that all the fixed assets that it purchased were added to its inventory records in a timely manner or that its inventory list was accurate and contained all the information needed to identify assets."
Why it matters: The university faced a higher-than-acceptable risk of misuse of university funds.
Standard: UMass Lowell's Procurement Card Program User's Guide and Policies requires monthly logs, bank statements, receipts, supervisory review, and supervisory signature. ( UMass Lowell’s Procurement Card (ProCard) Program User’s Guide and Policies; UMass Lowell Cardholder Responsibilities )
1 recommendation
- UMass Lowell should enhance its policies to better define supervisory activities and should provide additional training to supervisors regarding their timely completion of their ProCard responsibilities, if needed.agency: partially agreed
Agency response & Auditor reply
Agency: "Management will provide additional guidance and training where necessary to supervisors to ensure they are aware of supervisory responsibilities concerning ProCard log approval."
Auditor: "Whether or not the expenditures in question were business related, the 31 logs in question should not have been approved, because they lacked required information and/or documentation."