Remarks Made by Walter J. Kucharski
Auditor of Public Accounts
to the
Governor’s Blue Ribbon Commission on Higher Education in Virginia
September 8, 1999
This presentation has been posted
to this web site with permission of Mr. Walter Kucharski. EPI
wishes to express its appreciation to him for his assistance.
Board of Visitors’ Governance Issues
- Boards of Visitors have many of the same management and fiscal duties and responsibilities faced by Boards of Supervisors and City Councils.
- Institutions are complex business enterprises. Even the small institutions control $10’s of millions as an example Longwood is $47.3 million.
- State Institutions’ Governing Bodies and Management face competing demands for customer service, new community services, cost control, tuition and fees limits, defining the mission and setting direction.
- And more importantly, Competition from other Institutions.
General Fiduciary Responsibilities (Private) versus Public Responsibilities
- Public Procurement Act
- Personnel Act
- Investment of Public Funds
- Freedom of Information Act and Privacy Act
- Multiple Reporting & Accountability Responsibilities
- Typical Private College: Federal (Student Aid, Research, Grants, Employment, Taxes, etc.)
State (Student Aid, Employment, Taxes, etc.) Private (Donors, Students, Parents, Community, etc.)
- State College: As above, but with the following in additions, THE PUBLIC, General Assembly, Governor and Various State
agencies that control or oversee spending.
- Understanding the difference between the LAW and REGULATIONS
Defining and Controlling Funds
- Prudent Management of Endowment and other funds
versus Investment of Public Funds.
- All financial activity within the Institution is subject to the Freedom of Information Act.
- Institutions have numerous accountability and regulatory responsibilities to many groups and even within
these groups have differing responsibilities.
- Boards need to set the ground rules for administrating funds and who has the responsibility to both use and
control their use.
Defining Relationship
- Boards need to define the Institution’s business relationship with other entities such as related foundations, the community, business partners, suppliers and staff, who work beyond the institution.
- How does the Institution meet its mission and serve the community? Continuing Education courses, seminars, consulting, special studies, contracting and other opportunities beyond the traditional instruction and research.
- The needs to balance: operating a business, teaching students, and running a cost effective institution using Current Business Practices. The Traditional Open Government Competition Model does not lend itself easily to the concept of partnering or other arrangements that provide services rather than cost containment.
Keeping the Course
- Once the Board makes these decisions, they need to monitor and help their direction.
- Auditor of Public Accounts and internal auditors help boards monitor compliance with this direction.
- Boards need to work with the Auditors to ensure the auditors know the Board’s concerns and that their audit work includes these items.
Back to the Main Page
EPI would like to thank Mr. Kucharski for
allowing us to post his report on this web site.
Posted: September 9, 1998
By The Educational Policy Institute of Virginia Tech
sjanosik@vt.edu