Report 2015-107 Recommendation 17 Responses
Report 2015-107: The University of California: Its Admissions and Financial Decisions Have Disadvantaged California Resident Students (Release Date: March 2016)
Recommendation #17 To: University of California
To ensure that it spends state funds prudently for programs that do not directly relate to educating students, the university should track spending from state funds for programs that do not relate to educating students.
Annual Follow-Up Agency Response From October 2021
As referenced in the University's response to recommendation 16, UCOP has introduced tools for tracking expenditures from all core funds as a group and monitoring how their use aligns with instruction, student services, and other expense categories. Limiting this analysis to a specific component of core funds (e.g., State General Funds) would not provide a meaningful assessment of how that component is ultimately used because, as described above, core funds are largely fungible.
As noted previously, a full accounting of how State General Funds are allocated annually across campuses—including a breakdown of State funds that are allocated on the basis of student enrollment and funds that are allocated for specific identified programs (including programs that relate to all three elements of the University's mission: instruction, research, and public service)—is available on the University's website for each of the past three fiscal years at the following URL: https://www.ucop.edu/operating-budget//budgets-and-reports/other-resources/
- Completion Date: January 2019
California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement
The university's position is unchanged from its previous response. The university's response addresses allocation amounts, but not spending. Our recommendation is for the university to track spending of state funds for programs that do not relate to educating students.
- Auditee did not substantiate its claim of full implementation
Annual Follow-Up Agency Response From November 2020
As referenced in the University's response to recommendation 16, UCOP has introduced tools for tracking expenditures from all core funds as a group and monitoring how their use aligns with instruction, student services, and other expense categories. Limiting this analysis to a specific component of core funds (e.g., State General Funds) would not provide a meaningful assessment of how that component is ultimately used because, as described above, core funds are largely fungible.
As noted previously, a full accounting of how State General Funds are allocated annually across campuses—including a breakdown of State funds that are allocated on the basis of student enrollment and funds that are allocated for specific identified programs (including programs that relate to all three elements of the University's mission: instruction, research, and public service)—is available on the University's website for each of the past three fiscal years at the following URL: https://www.ucop.edu/operating-budget//budgets-and-reports/other-resources/
- Completion Date: December 2018
California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement
The university's response addresses allocation amounts, but not spending. Our recommendation is for the university to track spending of state funds for programs that do not relate to educating students.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From November 2019
The analysis referenced in the University's response to recommendation 16 includes all State General Funds as well as other core funds, which are collectively used to cover direct and indirect costs associated with the University's teaching and research mission.
A full accounting of how State General Funds are allocated annually across campuses—including a breakdown of State funds that are allocated on the basis of student enrollment and funds that are allocated for specific identified programs (including programs that relate to all three elements of the University's mission: instruction, research, and public service)—is available on the University's website for each of the past three fiscal years at the following URL: https://www.ucop.edu/operating-budget//budgets-and-reports/other-resources/
- Completion Date: December 2017
California State Auditor's Assessment of Annual Follow-Up Status: No Action Taken
The university's response addresses allocation amounts, but not spending. Our recommendation is for the university to track spending for programs that do not relate to educating students.
- Auditee did not substantiate its claim of full implementation
- Auditee did not address all aspects of the recommendation
Annual Follow-Up Agency Response From October 2018
The new methodology for reviewing expenditures described in the University's response to recommendation 16 includes all State General Funds as well as other core funds, which are collectively used to cover direct and indirect costs associated with the University's teaching and research mission.
The University publishes a full accounting of how State General Funds are allocated annually across campuses and major programs. See, for example, https://www.ucop.edu/operating-budget/_files/bap/2016-17_summary_of_state_general_fund_allocations.pdf
A more detailed listing of State funding by program is available at
https://www.ucop.edu/operating-budget/_files/legreports/17-18/AB97RedirectionofFundsforEnrollmentGrowthLegRpt.pdf
- Completion Date: December 2017
California State Auditor's Assessment of Annual Follow-Up Status: Pending
The university's response to recommendation #16 indicated that it was still in the process of developing the tracking tool. Further, the documents that the university references in this response do not sufficiently address our recommendation. As a result, we will mark this recommendation as pending and look forward to reviewing the university's response related to how it will track spending from state funds for programs that do not relate to educating students.
- Auditee did not substantiate its claim of full implementation
Annual Follow-Up Agency Response From November 2017
The Financial Planning & Analysis ("FP&A") unit has developed a prototype analytical tool and report for use in analyzing core funds expenditures at each UC campus during the past three years. The tool and report have the potential to provide useful information about trends in spending by function and by expense type to identify any significant year-to-year variances and to ensure that core funds are used in a manner consistent with the University's core mission. Upon final testing and review of the tool, UCOP staff will use it to conduct annual analyses to better understand spending patterns at each campus and to identify issues or trends for discussion with campus budget staff as necessary. For material variances, staff will consult with campuses to better understand the reasons for the variance, and recommend any action for future changes, if applicable. Staff will begin using this tool and reporting template beginning in early 2018 to review expenditures through FY2017.
- Estimated Completion Date: April 2018
California State Auditor's Assessment of Annual Follow-Up Status: Pending
The university's response does not address how its new tool and report will track spending of state funds for programs that do not directly relate to educating students. Therefore, we look forward to its 2018 response to understand how the university will use the new tool and report to implement our recommendation.
1-Year Agency Response
UC does not agree that spending on programs for research or public service should be subjected to a greater level of scrutiny than programs related to instruction, since all such programs support the University's core mission. The University plans to include all core fund expenditures in the framework that it develops for monitoring and evaluating how funds are used (as described in our response to #16) with the same expected delivery date.
- Estimated Completion Date: September 2017
- Response Date: March 2017
California State Auditor's Assessment of 1-Year Status: No Action Taken
As noted in our previous response, we are not advocating a different level of scrutiny. In point of fact, the university was already subjecting certain programs to differing level of scrutiny by not actively reviewing them. We continue to recommend that the university actively track spending of state funds for programs that do not directly relate to educating students, and thereby apply the same level of review and stewardship that should be used with all allocations of state funds.
6-Month Agency Response
The University strongly disagrees with the suggestion that programs that do not directly relate to the instructional mission but relate to one of the two other core missions of Research and Public Service should be subjected to a different level of scrutiny.
With that said, consistent with the University's response to recommendation 16, the University will implement a system for monitoring the use of all core funds to ensure they are being spent prudently and consistent with the University's missions.
- Estimated Completion Date: September 2017
- Response Date: August 2016
California State Auditor's Assessment of 6-Month Status: Pending
The university misconstrues our recommendation as we do not suggest that it should subject research and public service programs to a different level of scrutiny. Rather, we recommended that the university should actively track spending of state funds for programs that do not relate to educating students, which are the 18 programs listed on Table 17 on page 75 of our report. As noted on page 71 of our report, the university does not actively track the allocation of state funds to these programs, and essentially, was continuing to fund these programs without putting any thought into whether that funding was necessary or justified, or considering whether alternate funding sources exist.
60-Day Agency Response
The University has a tripartite mission - teaching, research, and public service. It is committed to ensuring that State funds are used appropriately within all three of its defined missions. The University strongly disagrees with the suggestion that programs that do not directly relate to the instructional mission but relate to one of the two other core missions should be subjected to a different level of scrutiny.
With that said, consistent with the University's response to recommendation 16, the University will implement a system for monitoring the use of all core funds to ensure they are being spent prudently and consistent with the University's missions.
- Estimated Completion Date: September 2017
- Response Date: May 2016
California State Auditor's Assessment of 60-Day Status: No Action Taken
We asked the university whether it has begun to develop the system and why it believed the system would take until September 2017 to implement. The university subsequently stated that its initial 60-day response provided sufficient information. Because the university did not provide any specifics as to what steps it intends to take or when it will begin to develop the system, we consider the university to have taken no action on this recommendation.
All Recommendations in 2015-107
Agency responses received are posted verbatim.