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July 28, 2005 Special Board Meeting Minutes

The Board of Trustees of Illinois Valley Community College District No. 513 convened a special session at 4:00 p.m. on Thursday, July 28, 2005 in the Board Room C307 at Illinois Valley Community College.

Members Present:
David L. Wilcoxson, Vice Chair
David O. Mallery
Lori E. Scroggs
Thomas C. Setchell
Dennis N. Thompson

Members Absent:
Deborah L. Sweeden, Board Chair
Paula J. Endress, Secretary
Matt Simko, Student Trustee

Others Present:
Robert Marshall, Acting President
Harriet Custer, Vice President for Academic Affairs
Jerry Corcoran, Vice President for Business Services/Finance

 

CONTRACT TERMINATION AGREEMENT
It was moved by Mr. Thompson and seconded by Mrs. Scroggs to approve the Contract Termination Agreement between Dr. Jean Goodnow and the Board of Trustees of Illinois Valley Community College as presented.
Roll Call Vote: “Ayes” – Mr. Thompson, Mr. Mallery, Mrs. Scroggs, Mr. Setchell, and Mr. Wilcoxson. “Nays” – None, motion carried.

 

INTERIM PRESIDENT’S CONTRACT
It was moved by Mr. Setchell and seconded by Mrs. Scroggs to approve the Employment Agreement between the Board of Trustees of Illinois Valley Community College and Charles R. Novak, Interim President as presented.
Roll Call Vote: “Ayes” – Mr. Thompson, Mr. Mallery, Mrs. Scroggs, Mr. Setchell, and Mr. Wilcoxson. “Nays” – None, motion carried.

 

PROGRESS REPORT ON THE AUDIT
Karl Appelquist and Lana Eddy were present at the meeting to answer questions regarding the audit. Mr. Appelquist gave a brief summary of the Clifton Gunderson employees who work on the IVCC audit and their educational experience. He reported that his firm randomly selects 25 expenditure items in each of the grant programs and tests all attributes as required by ICCB. In the financial aid area, the firm randomly selects 25 students and follows each student through the program. Internal controls are tested for accounts payable disbursements. They test the payee, the date, the signature, the endorsement, supporting documentation and check to see if the accounts payable check is recorded to the appropriate expenditure account. Twenty five accounts payable disbursements are randomly selected and tested. The same internal control test is done with the payroll - checking the date, the amount, the signature, the endorsement, rate of pay, W-4, cancelled check and to what account it was posted. The number 25 is driven by what you think your risk of error is and what your reliance on that control is going to be. No specific test is done for student activity funds but these could be randomly included in the accounts payable disbursement tests. In regard to the materiality equation for each fund and with the implementation of GASB 35, colleges are looked at as a business type activity. Materiality, based on June 30, 2004, is calculated by taking the greater of assets or revenue and referring to a table. Materiality for this period of time for IVCC is $323,000. If the reports from the audit are off by $323,000 or less it is still considered a fair report. Any past adjustments are included in a communication letter addressed to the Board. Mr. Appelquist noted that the fixed assets are now in a fixed asset program. No specific test is conducted for political activities. Statement of Auditing Standard (SAS) 99 requires inquiries to be conducted and questions are asked of management if there is any known fraud, any unethical behavior, and “the tone at the top.” The auditors do not provide an opinion on the recognition reports from ICCB. The auditors do trace the credit hours through the ICCB reports. Compliance tests on bidding requirements fall under the single audit. Mr. Appelquist referred to GASB 39 when discussing the Foundation as a component unit of the College. GASB 39 states if you have an organization that substantially benefits the operating entity, they are connected. Therefore, the Foundation audit is included in the College’s basic financial statements. The Board questioned the independence of the Foundation and if the Board of Trustees should be involved in the Foundation’s performance and activities. The Board questioned if there would be more controls if the treasurer was not an employee of the College. Mr. Appelquist responded that if the Board had a treasurer who was not the College CFO, there would be an additional level of control; however, that would not be the norm. The Board was pleased and thanked Mr. Appelquist and Ms. Eddy for the learning experience.

 

ACTING PRESIDENT
Dr. Robert Marshall expressed his appreciation to the Board for the opportunity to serve as acting president. It was a growth and learning experience for him and one that he enjoyed.

 

ADJOURNMENT
It was moved by Mr. Thompson, seconded by Mr. Setchell, and carried unanimously to adjourn the meeting at 5:07 p.m.