Framingham State University's Use of American Recovery and Reinvestment Act Funds

This is a state audit of how Framingham State University used and tracked American Recovery and Reinvestment Act federal stimulus funds from August 6, 2009 through May 31, 2010.

“In accordance with Chapter 11, Section 12, of the Massachusetts General Laws, we have conducted an audit of certain activities of FSU for the period August 6, 2009 through May 31, 2010.”

Auditors checked whether the university watched over the stimulus funds, spent them for the right purposes, and followed rules about reporting losses, shortages, thefts, or other problems.

“The objectives of our audit were to review FSU’s controls over and monitoring of American Recovery and Reinvestment Act (ARRA) funds received and expended, to determine whether these funds were expended for their intended purposes, and to evaluate its compliance with applicable laws, rules, and regulations, including Chapter 647 of the Acts of 1989 regarding the requirement to report all variances, losses, shortages, or thefts of funds or property to the Office of the State Auditor.”

The audit matters because weak controls over student aid records create a risk that public money could be spent for the wrong reason and not caught in time.

“Without adequate internal controls over Student Fee Grant activities, there is a risk that these funds may be expended for an unintended purpose without being prevented or detected.”

For students, families, and taxpayers, the report shows whether stimulus funds meant for things like student aid, technology, renovations, and facilities were tracked and used properly.

“FSU’s budget of these funds included amounts for state employee compensation; student financial aid; tax exempt lease purchase (TELP), including (a) an academic technology costs component, (b) infrastructure upgrades, and (c) information technology equipment; library renovations; expansion of the university dining facility; and chiller replacement.”

The main problems were missing written rules for the Student Fee Grant, some student files that did not show eligibility clearly, poor separation of duties, and failures to report stolen laptops as required.

“However, we found that, contrary to the Office of the State Comptroller (OSC) and ARRA guidelines, FSU lacked formal, written eligibility criteria or policies and procedures for the administration of Student Fee Grant expenditures.”

The university said it would put student grant policies and controls in writing, review them regularly, document exceptions, and strengthen procedures for reporting missing laptop equipment.

“The Framingham State University Financial Aid Office has documented its policies, procedures, and internal controls related to the FSU Student Fee Grant in writing.”

The university received more than $7 million in stimulus awards during the audit period and had spent and been reimbursed for about $4.2 million by May 31, 2010, so the findings involve oversight of a meaningful amount of public money.

“During the audit period, FSU was awarded federal stimulus funds totaling $7,098,906.”

Chapter 647 is the state rule requiring agencies to report missing, stolen, lost, or short funds or property to the State Auditor’s Office.

“All instances of unaccounted for variances, losses, shortages, or thefts of funds or property are immediately reported to the State Auditor’s office pursuant to Chapter 647 of the Massachusetts Acts of 1989 by the Chief of Campus Police.”