BOARD OF DIRECTORS ANNUAL MEETING Thursday, September 27, :00 P.M. Foundation Boardroom. Minutes

Transcription

1 L STATE SAN BERNARDINO University Enterprises Corporation BOARD OF DIRECTORS ANNUAL MEETING Thursday, September 27, :00 P.M. Foundation Boardroom Minutes Members Present: Members Absent: Others Present: Andy Bodman Bob Brown Bob Gardner Josephine Mendoza Tomas Morales Frank Rincon Ed Teyber James Walker Val Zellmer Happy Almogela Lois Carson Dorothy Chen-Maynard Debbie Burns Lisalannolo Cara-Marie Pham Jeff Thompson Diane Trujillo Maya Ivanova, RAMS Danielle Odgers, RAMS Matthew Wilson, RAMS Dr. Ed Teyber called the meeting to order at 3:10 p.m. A. Introductions/Welcoming Remarks Ed Teyber opened the meeting by welcoming Dr. Tomas Morales as the new President of CSUSB. UEC Board of Directors members introduced themselves and their roles on the Board. Dr. Morales shared his background with the Board. When at Cal Poly Pomona, he served on the Foundation Board and is familiar with the types of work that UEC does for the campus. While at Cal Poly Pomona, he served in various roles including Provost and Vice President

2 for Academic Affairs, Vice President for Student Affairs, and Professor of Education. Dr. Morales expressed his enthusiasm for areas of growth under UEC. Lastly, Dr. Morales emphasized the importance of the November 6th election. Prop 30 is an initiative that would increase state revenue for K-12 schools and community. If it does not pass it would trigger an additional budget cut for CSU of $250 million and over $47 million to CSUSB. B. Approval of Minutes The minutes of the June 28, 2012 were reviewed and approved as written. (Brown/Mendoza/Unanimous) C. Audit Report & Approval It is recommended that the Board approve the annual audit completed by the audit firm of Rogers, Anderson, Malody & Scott, LLP. Each year, an independent audit examination and report is completed by a firm hired by University Enterprises Corporation at CSUSB ("UEC"). The firm completes the process by using both "Governmental Accounting Standards Board" (GASB) and "Financial Accounting Standards Board" (FASB) rules. This is required by the CSU system. UEC's Audit Committee met with Maya Ivanova, CPA, on June 28, 2012 prior to the audit process to discuss issues identified as important for the auditor to review. The audit results were reviewed with the Audit Committee on September 27, These audit results are also presented to the Board for approval. Maya Ivanova reviewed the audit with the Board. She began by applauding the significant turnaround of the financial position from the previous years and the work of the Auxiliary Accounting department. Maya highlighted areas that were of significant change from the last year. The majority of the assets were transferred to the Philanthropic Foundation at the beginning of the 2011/2012 fiscal year. It was mentioned that in the year, the Observatory will be also transferred off the UEC assets. A new Actuarial Report was conducted updating the information for post retirement medical benefits. In addition, in the 2011/2012 fiscal year there was an understatement in the Art Museum assets and a prior year adjustment was required. Maya reported there was one finding this year related to the single audit that RAMS conducted. RAMS found an incident where UEC was not maintaining sufficient documentation to determine whether or not verification of suspension/debarment status was

3 being checked for vendors/contractors prior to awards being made. UEC management has accepted the internal control issue as a finding and has already created a response letter with a corrective plan. There was discussion on why the grant expenditures and indirect was down. It was concluded that the main reason for this decrease is due earmarks and large federal support coming to an end. The result of a decrease in expenditures leads to a decrease in indirect cost being collected. Lisa lannolo, Director of Auxiliary Accounting, presented UEC's June 30, 2012 Financial Statement to provide additional details and clarification to the audit report. She explained to Dr. Morales the format of the fmancials that is presented to the Board and expressed that she is open to change. The Board approved the Audited Financials as presented. (Brown/Gardner/Unanimous) D. Revised Articles of Incorporation It is recommended that the Board approve a minor change to UEC's Articles of Incorporation. This change is necessary due to a recent modification to Title 5 that applies to all auxiliary organizations. A recent change to Title 5 [Section 42600(b)] requires auxiliary organizations to amend their Articles of Incorporation dissolution clause. Debbie Burns informed the Board that by December 31, 2012 the amended Articles of Incorporation should be filed with the Secretary of State with a dissolution clause that replaces the "Board of Trustees" with the "Chancellor" in the successor approval process. Debbie explained that this was the only change to UEC's Articles of Incorporation. The Board approved the minor change to UEC's Articles of Incorporation without hesitation. (Bodman/Zellmer/Unanimous) E. Conflict of Interest Statement

4 It is recommended that the Board members review, sign, and return the attached Conflict of Interest Statement for the period July 1, 2012 through June 30, 2013 at the conclusion of the Board Meeting. It is UEC's responsibility to ensure that all Board Members sign a Conflict of Interest Statement for the current year, in accordance with California Education Code, Sections Debbie explained that this is a document that needs to be signed by each Board member yearly. It is an auditable item and after being signed the forms are given to Cara Pham to maintain in our files. The Conflict of Interest was approved by the Board. (Brown/Mendoza/Unanimous) F. Executive Director's Report Debbie Burns, Executive Director, updated the Board regarding the status of UEC operations and other relevant matters. She began with a UEC employee healthcare update. UEC went out to bid for health insurance and Blue Shield refused to quote due to 75% participation in Kaiser out of 100 total employees. Debbie pointed out that in the past, the Board approved up to a 2% increase in employee contribution. Debbie stated that she would bring the summary of previous vs. new employee contributions to the next meeting. In the meantime, UEC is researching options. Debbie notified the Board that there will be a significant expenditure coming up for a new software program. A RFP will be put out this year for a new Human Resources software solution. PeopleSoft's common HRIS ("CHRIS") system cannot accommodate auxiliaries any longer. UEC is researching costs associated with this change estimated at about $65,000 annually. Within the next month, UEC will be able to contribute to the VEBA trust. Last year UEC joined the VEBA trust for its retiree medical liability and is now able to deposit $646,401 due to the significant financial turnaround. Debbie Burns expressed the importance of Proposition 30 passing to avoid additional budget cuts for CSUSB. She stated that UEC has provided approximately $2,900 in financial support for Proposition 30. Every year UEC receives Coke Sponsorship funding based on sales, and we can receive up to $100,000. The fiscal year ending June 30, 2011 showed that the campus was 13.8% below threshold earning us a total of $86,200. Currently, the funds are split with 60% going to

5 Athletics, 30% staying in UEC, and 10% going to Student Affairs. It was agreed by the Executive Committee that the allocation be reviewed for next year. A check will be disbursed within a couple of weeks to each department. G. Financial Update Diane Trujillo, Director of Sponsored Programs Administration, and Jeff Thompson, Associate Provost for Research, reviewed the financial status of Sponsored Programs and provide a 10-year recap of Indirect Cost Recovered. Diane explained that the reduction of expenditures has a direct relationship to the decrease in indirect that is available to distribute to the campus. It was requested that Dr. Bodman and Dr. Morales receive a more detailed breakdown of the Sponsored Programs Administration expenditures. A concern was brought up regarding some of the charges on the financial statements. Debbie explained that there are MOU's with the campus for various services provided by UEC and Sponsored Programs Administration. Dr. Morales requested to receive copies of all MOU's between the campus and UEC or Sponsored Programs so that he can get a better understanding. H. Committee Reports In lieu of committee presentations to the Board, drafts of all minutes of Standing Committees are provided with this board meeting package. The meeting adjourned at 4:38 p.m. Minutes approved by: ^ Date: