A Report on Agencies', Higher Education Institutions', and Community Colleges' Compliance with Public Investment Reporting Requirements
May 2016
Report Number 16-027
Overall Conclusion
The majority of agencies, higher education institutions, and community colleges subject to the Public Funds Investment Act (Act) submitted compliance audit reports that indicated they fully or substantially complied with the Act in fiscal year 2015. Those entities had approximately $70.6 billion in investment holdings as of August 31, 2015. Therefore, it is important that they comply with statutes and investment reporting requirements designed to help the Legislature, the entities' boards, and the public ensure that the entities manage and disclose their investments appropriately by providing transparency to stakeholders.
Additionally, all higher education institutions and community colleges fully complied with higher education investment reporting requirements in Rider 5, page III-241, General Appropriations Act (83rd Legislature), and prescribed by the State Auditor's Office at http://www.sao.texas.gov/InternalAudit/PublicFunds/.
It is important to note that the entities self-reported the information in this report, and the State Auditor's Office did not independently verify that information. The following describes compliance by the type of entity for fiscal year 2015:
- Agencies. Twelve of the 14 agencies subject to the Act submitted compliance audit reports that indicated they fully or substantially complied with the Act. The Water Development Board and the Texas Military Department submitted compliance audit reports that indicated they minimally complied with the Act.
- Higher Education Institutions.
-- Compliance with the Act. All of the 17 higher education institutions subject to the Act submitted compliance audit reports that indicated they fully or substantially complied with the Act.
-- Compliance with Higher Education Investment Reporting Requirements. All of the 17 higher education institutions fully complied with the higher education investment reporting requirements in Rider 5, page III-241, General Appropriations Act (83th Legislature), and as prescribed by the State Auditor's Office.
- Community Colleges.
-- Compliance with the Act. Forty-nine of the 50 community colleges subject to the Act submitted compliance audit reports that indicated they fully or substantially complied with the Act. Clarendon College submitted a compliance audit report that indicated it minimally complied with the Act.
-- Compliance with Higher Education Investment Reporting Requirements. All of the 50 community colleges fully complied with the higher education investment reporting requirements in Rider 5, page III-241, General Appropriations Act (83rd Legislature) and as prescribed by the State Auditor's Office.
- University systems not subject to the Act but still subject to the higher education investment reporting requirements. The University of Texas System, Texas A&M University System, Texas Tech University System, and University of Houston System are not subject to the Act but are still subject to the higher education investment reporting requirements. Those four university systems fully complied with the higher education investment reporting requirements.
Some entities did not submit a compliance audit report by the Act's statutorily required due date of January 1, 2016. In addition, a significant number of higher education institutions and community colleges did not fully comply with the higher education investment reporting requirements by the statutory due date of December 31, 2015. However, after auditors contacted those entities and extended the due date for reporting to auditors until March 25, 2016, most of those entities either submitted the required information to the State Auditor's Office or posted it on their Web sites.