The annual audit of the University’s National Alumni Association shows the body will continue operations, having passed the audit with only two recommendations made by auditors.
In the audit presented to the Board of Trustees March 8, the committee identified two areas the NAA should address.
“One is to ensure that all restrictions imposed on donors are in writing on the donor form with a donor signature line,” said Alvin Bryant, president of the FAMU National Alumni Association. “Secondly, the FAMU NAA will work with the FAMU Foundation to ensure in the future that all entries and transactions to the FAMU NAA accounts will be approved by the president and treasurer prior to posting and that records of these transactions will be readily available.”
Direct Service Organization audits are not conducted through the University, but are both University and state mandated. The NAA was not the only body audited this year.
“The annual audits are for all Direct Support Organizations such as FAMU Boosters and the FAMU Foundation and not limited to the NAA,” said Rufus Little, vice president of the Division of Compliance and Audit. “The Boosters’ and Foundation audits were completed earlier in the year.”
Audits are designed to ensure that organizations are in compliance with Florida Statute 1004.28(1) (a).
The statute stipulates that in order to be certified as a DSO, an organization must conduct an annual audit and management response letter, which should be submitted to the University president and BOT for review and approval.
“Audits are necessary for the sound management of an organization and to ensure the financial operations are in order,” Bryant said. “Our organization is here to support the students and we hope that students upon graduation will join the NAA and be in a position to give back to the NAA.”
If an audit reveals an organization is not acting in the best interest of the University, the BOT has the authority to request that the president decertify a DSO.
If a DSO is decertified, it would have to discontinue use of the University name and would also lose group exemptions with the IRS.
University faculty are not surprised the NAA passed its audit.”The FAMU NAA has always had good audits,” said Altha Manning, president of the Office of Alumni Affairs. “The only issue that has been noted is how they’ve used membership funds as restricted funds versus operational funds,” she said.
The restricted versus operational funding was addressed by the audit to ensure that all funds are properly allotted in the NAA. Another cause of concern was that mail from the IRS was not being sent directly to the NAA. “
In this particular instance the mail went to the Office of Alumni Affairs,” Bryant said. “We have corrected this so that future mail will be sent to our P.O. Box.”
The only aspect of the audit remaining is the management response, which is still being completed, Manning said. The management response is an opportunity for the NAA to address the findings of the audit.