Bridgewater State University
June 10, 2014 · Read the full official report (PDF) ↗ · official site ↗
Published June 10, 2014 Audit covers July 1, 2010 – June 30, 2012 Under Suzanne M. Bump · 2011–2023
source
“BSU has continually noncompetitively awarded a contract for food and beverage services to its food-service provider, Sodexo Operations LLC (Sodexo), contrary to its own internal procurement policies and procedures and a joint policy issued by the state’s Operational Services Division and Office of the State Comptroller (OSC).”
Read the plain-English breakdown
This is a Massachusetts State Auditor performance audit of Bridgewater State University covering July 1, 2010 through June 30, 2012.
“This report summarizes the results of our audit of certain activities of Bridgewater State University (BSU) for the period July 1, 2010 through June 30, 2012.”
The State Auditor reviewed BSU because state universities are subject to the Auditor’s oversight of state government entities.
“This audit was conducted as part of the Office of the State Auditor’s (OSA’s) mandated oversight of state government entities, including state universities.”
The problems could affect whether public money is tracked accurately, contracts are fair, and university property is protected.
“Because MMARS is the Commonwealth’s accounting system, inaccurate accounting in MMARS means that the Commonwealth’s accounting records related to this account are inaccurate and cannot be relied on.”
For taxpayers, students, and families, the audit matters because poor bidding and oversight can mean the university may not be getting the best deal for services paid for with public or student-related funds.
“Without using a competitive bidding process, BSU cannot be certain that it is obtaining the best value at the best price for these services.”
The Auditor found that BSU needed stronger controls over contracting, accounting, trust funds, internal controls, and inventory reporting.
“Based on our audit, we have determined that for the period July 1, 2010 through June 30, 2012, excluding the issues addressed in the Detailed Audit Results and Findings section of this report, BSU maintained adequate internal controls over its financial operations and program activities for the areas tested.”
The report recommends that BSU fix its procedures, improve monitoring, correct reporting practices, update its internal control plan, and follow required rules for trust funds and missing property.
“OSA recommends that BSU take the following actions:”
The audit is significant because it found large dollar errors, including overstated receivables and misclassified expenses, plus missing-property reporting failures.
“It overstated its “current” (less than 30 days outstanding) accounts-receivable balance as of December 31, 2011 by $21,912,869 in a report submitted to OSC for fiscal year 2012.”
An internal control plan is basically an agency-wide plan for spotting risks and explaining what safeguards are in place to reduce them.
“The Office of the Comptroller defines an internal control plan as a high level department-wide summarization of the department’s risks and the controls used to mitigate those risks.”
5 figure(s) pending source verification - not shown
What the Auditor checked
- Did not comply Assess internal controls over BSU's administration of its food-service contract.
- Complied Assess internal controls over student activity accounts and whether funds were properly accounted for and expended for intended purposes.
- Did not comply Assess BSU's administration of trust funds, internal controls over these funds, and whether expenditures were appropriate.
- Did not comply Assess internal controls over BSU's inventory of fixed assets and its accounting of those assets.
- Did not comply Assess BSU's compliance with Chapter 647 of the Acts of 1989.
- Did not comply Assess adequacy of internal controls over accounts receivable and administration of receivables.
- Did not comply Assess internal controls over administrative expenses, including consultants, travel, honoraria, and credit cards.
What the Auditor found
Why it matters: BSU may not have received the best price and value and could not effectively assess the reasonableness of price increases.
Standard: State Finance Law and General Contract Requirements jointly issued by OSC and OSD, and BSU Purchasing department policies and internal procedures. ( BSU Purchasing department Policies and Internal Procedures )
1 recommendation
- Use competitive bidding for food-services procurement unless an approved exception applies.
Agency response & Auditor reply
Agency: "The University will review and establish formal procedures for monitoring its food service contract and evaluate the services thereunder."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Why it matters: OSC received inaccurate receivable information, reducing the reliability of Commonwealth receivable records.
Standard: OSC's Receivable Recognition and Reconciliation policy. ( OSC Receivable Recognition and Reconciliation policy )
4 recommendations
- Complete and file Midyear Reports by the requested date.
- Develop detailed procedures for preparing and filing annual Midyear Reports with OSC.
- Ask OSC whether amended or missing reports should be submitted.
- Develop a BISS reporting system to substantiate receivable balances reported in MMARS.
Agency response & Auditor reply
Agency: "The University acknowledges a misreporting of the accounts receivable balances for the period reported."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Why it matters: Commonwealth accounting records for these expenses were inaccurate and could not be relied on.
Standard: OSC's Expenditure Classification Handbook. ( OSC Expenditure Classification Handbook )
1 recommendation
- Report and classify expenses in MMARS using correct OSC object codes.
Agency response & Auditor reply
Agency: "The institution no longer summarizes expenses by pooling to one object code in MMARS; the University is now utilizing the correct OSC object code classification per the MMARS expenditure handbook."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Why it matters: An incomplete internal control plan can impair BSU's ability to manage risks, safeguard assets, and ensure compliance.
Standard: OSC Internal Control Guide and Internal Control Questionnaire requirements. ( OSC Internal Control Guide )
2 recommendations
- Update the ICP to include all eight ERM components and distribute it to departments.
- Ensure annual ICQs submitted to OSC are accurate.
Agency response & Auditor reply
Agency: "The University recognizes its Internal Control Plan (ICP) is a critical living document in need of continuous review and modification, while acknowledging the ICP did not include all eight components relevant to enterprise risk management."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Why it matters: BSU could not be certain trust-fund revenues and expenses were properly administered.
Standard: Chapter 73, Section 14, of the Massachusetts General Laws and Board of Higher Education's Standards for Expenditures of Trust Funds. ( Chapter 73, Section 14, of the Massachusetts General Laws; Board of Higher Education's Standards for Expenditures of Trust Funds )
Agency response & Auditor reply
Agency: "The University is actively examining and revising all trust fund guidelines and related procedures for consideration, revision and approval by the Board of Trustees."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Why it matters: BSU could not be certain its fixed-asset values were accurate or that assets were safeguarded against loss, theft, and misuse.
Standard: OSC's Accounting and Management Policy for Fixed Assets, Chapter 647 of the Acts of 1989, and BSU's internal control plan. ( OSC's Accounting and Management Policy for Fixed Assets; Chapter 647 of the Acts of 1989 )
3 recommendations
- Conduct annual physical inventories of all fixed assets.
- Reconcile the asset management database to physical inventory results.
- Implement written CRIM procedures for Chapter 647 reporting requirements.
Agency response & Auditor reply
Agency: "The University will develop new inventory control policies and procedures ensuring that physical inventories are conducted in a manner that complies with applicable statutory and regulatory requirements."
Auditor: "Based on its response, BSU is taking measures to address our concerns in this area."
Verified dollar findings
Estimated or sample-projected amounts - shown separately because they are not a hard-identified dollar figure.
More audits of this entity
Other Office of the State Auditor reports on Bridgewater State University .
- Audit of the Bridgewater State UniversityCollege / University · June 14, 2022
- Bridgewater State UniversityCollege / University · January 31, 2011