Summary of Report 04-020

A Financial Review of The University of Texas at San Antonio

February 2004

Report Number 04-020

Overall Conclusion

The University of Texas at San Antonio (University) had systems and procedures in place to report accurate and consistent financial information in its fiscal year 2002 Annual Financial Report (AFR). It has benefited from knowledgeable and experienced financial management. However, inadequately documented procedures for preparing the AFR and incomplete supporting documentation for some amounts in the AFR create a risk of inaccurate or inconsistent reporting in the event of staff turnover or unexpected absences. Security and access control weaknesses in the University's information technology and systems also increase the risk of inaccuracy, inconsistency, and fraud in future financial transactions and information. The University's rapid growth and expansion, which are expected to continue through at least 2015, heighten the significance of these risks.

With the exception of noncompliance in the use of procurement cards, the University generally uses state and local funds in accordance with applicable state laws and regulations. Some employees used procurement cards to purchase items for the University, such as computers, cellular phones, and cameras, that are required to be purchased through the formal purchasing process instead of with a procurement card. We also noted that some employees split purchases between transactions to avoid exceeding the dollar transaction limit. Procurement card purchases made by 226 cardholders totaled $1.4 million during the fiscal year.

The University adequately controls the establishment and execution of contracts. However, it is not able to generate a complete list of its current contract obligations without spending an inordinate amount of time and effort. As a result, it is not able to analyze its total current contract obligations or report completely on them to the Legislative Budget Board as required by law. We identified 120 contracts active during fiscal year 2003, totaling $86.3 million, that were not reported to the Legislative Budget Board as required.

The University currently lacks adequate data for reporting on two key performance measures: the Percent of Baccalaureate Graduates Who Are First Generation College Graduates, and the Certification Rate of Teacher Education Graduates. These two measures are especially important for the University as it emerges as one of the State's largest public higher education institutions with a majority enrollment each year of historically underrepresented students.