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March 2, 2018

UW System Failed in Audit of Foundation Arrangements

      As Vice-Chairman of the Senate Universities and Technical Colleges Committee, I responded to the release of the audit reviewing relationships of UW System campuses with foundations or other affiliated groups.  The audit (Report 18-4) was released by the nonpartisan Legislative Audit Bureau.

      Over the previous ten years, the UW System failed to properly review or clearly account for about $257.9 million in transactions that went from a campus to one of these private foundations or affiliated groups. 

      Normally, the private foundations are set up so that funds go from them to the campus, not the other way around.  While these transactions may not have been illegal, the auditors were unable to determine absolute appropriateness due to incomplete records and poor accounting practices.

      The audit also identified that several of the private university foundations may not have fully reimbursed campuses for the cost of services provided by university employees.  Additionally, the audit clearly identifies a lack of UW System policies relating to preventing conflicts of interests or unethical conduct in the business arrangements between campuses and private foundations.

      We can’t rely on the Board of Regents to enact policies to regulate themselves in these situations.  I will be drafting legislation to, by law, regulate the relationship of UW System campuses and private foundations.

To read the extensive audit click here.