A report by California State University found the Fresno State Athletic Corporation failed to maintain important business records pertaining to payroll.
According to the report, the corporation did not keep adequate records of new hires, overtime, vacation leave, termination and salary changes.
The review indicated that the corporation lacked adequate oversight due to turnover in senior management positions during the period in which the audit took place and did not have a plan in place to ensure that important business records were maintained.
In November of 2017, Jim Bartko resigned from his position as Fresno State’s director of athletics and it was not until June of this year that Terry Tumey was announced as Fresno State’s next director of athletics.
In seven of the 15 new hire transactions that were reviewed, there was a lack of documentation to support that background checks for new employees had been performed, the audit released on Oct. 5 says.
In two instances, the report said that Employee Eligibility Verification, I-9 forms, had not been completed or, in one case, were completed 97 days after the employee’s first day of employment.
Federal guidelines state employment verification must be completed within three business days of the date that employment begins.
In five of the 10 employee overtime transactions that were reviewed, the number of overtime hours that were recorded on employees’ timesheets did not match the number of hours of overtime that were on the employee’s check, according to audit.
The CSU found Fresno State has failed to maintain key documents that would help verify time worked and paid to athletic employees. The audit also reviewed 15 employee termination transactions, and according to the report, there were four instances in which documentation regarding employee termination was not maintained and therefore it was unable to verify the employee’s last official day of employment.
The audit also found that the corporation employee handbook had not been updated since May of 2006 and it does not include information regarding whistleblower reporting procedures.
The CSU has recommended that the corporation and Fresno State maintain documentation for personnel and payroll processes as well as update the employee handbook.
The CSU requested the corporation review and corrects its hiring processes by Nov. 1. In addition to the problems regarding documentation of payroll, it was found during a review of 10 athletic camps, there were nine instances in which the corporation was without documentation to demonstrate that its athletic camps had been properly reviewed and approved.
In a written statement, Debbie Adishian-Astone, Vice President of Administration and Chief Financial Officer, said “the recommendations in response to the findings involving payroll, timekeeping and background checks associated with employees working sports camps (summer) have been implemented in preparation for the department’s internal camp-approval process, which starts in January 2019.”
The report also found that the corporation had no reserve balance and that it had no reserve policy in effect. According to the CSU, the corporation had suffered operating losses of $7.6 million and $7.5 million in 2017 and 2016.
CSU recommended in its report that the corporation develop and implement a reserve fund policy to ensure that it is financially capable to deal with unexpected expenses.
According to the audit report, management at the corporation responded by saying that it is operating with a non-cash deficit and is unable to generate a net surplus in order to create a capital reserve. A reserve fund policy is expected to be completed by Dec. 15.
“We take every audit very seriously and will be responsive in addressing the recommendations, and will continue to identify additional areas where we may need to strengthen our policies and procedures,” Adishian-Astone said. “We will continue to consult with our Athletic Corporation Board of Directors and Audit Committee regarding the implementation of these recommendations. Lastly, the Department of Athletics has also initiated a recruitment for an Assistant AD for Business Operations who will directly manage the Athletic Business Office and who will work in close coordination with the campus Chief Financial Officer.”
