May 6, 2011
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Annual Audit Requirement
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CDAM Changes
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Common Audit Findings
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Follow up on repeat findings
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Education Code 84040(b)
California Code of Regulations (CCR), title 5,
section 59100-59114
Education Code 84040.6
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Additions
◦ Section 473 – Economic and Workforce
Development
◦ Section 478 - Preference for Veterans and Qualified
Spouses for Federally Funded Qualified Training
Programs
◦ Section 479 – To Be Arranged Hours (TBA)
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Expansion
◦ Section 425 – Residency Determination for Credit
Courses
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Removals
◦ Section 428 – Use of Matriculation Funds
◦ Section 434 – Scheduled Maintenance Program
◦ Section 436 – Minimum Conditions – “Standards of
Scholarship”
◦ Section 440 – Compliance References for Optional
Tests of Specific State Programs
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Revisions
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Section
Section
Section
Section
Section
280 – Audit Findings
310.04 – Overview
331 – Auditors Report on State Compliance
410 .05, .06, .07, .08 – Overview
420 – Required State Compliance Test
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Edits
◦ Edits were made to various sections to correct or
delete dates, footnotes, information, names,
numbers, references, tables, and webpage links to
reflect current information. Also, emphasis was
added to highlight some key information.
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Background
◦ EWD monies are awarded to colleges/districts
through grants and must be expended and deliver
services to meet the needs identified in regional
economic development plans.
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Criteria
◦ Education Code Section (ECS) 66010.4 (a)(3)
◦ ECS 88500 et seq
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Ten Statewide Strategic Priority Initiatives in which EWD Centers
are the delivery system used for the following areas:
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Advanced Transportation Technology & Energy (ATTE)
Applied Biotechnology (BioTech)
Environmental Training (ETC)
Health Workforce Initiative (HWI)
Applied Competitive Technologies (CACT)
Centers of Excellence (COE)
International Trade Development (CITD)
New Media & Entertainment (NMEI)
Business and Entrepreneurship (BEC)
Workplace Learning Resource (WKPL)
Centers are the long term infrastructure of the EWD program.
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Industry Driven Regional Collaborative (IDRC)
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Incumbent Worker Responsive Training Fund (IRTF)
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◦ Projects are demand driven by industry needs
◦ Provides funds for colleges to allow faculty to develop new curriculum with
industry partners.
◦ Expand the delivery of performance improvement training to employers
and incumbent workers in high growth industries; and/or
◦ Foster “bridging” basic skills education to career technical programs in
colleges that provide high-career pathways.
Job Development Incentive Training Funds (JDIF)
◦ Provides training on a no-cost or low-cost basis to participating
employers who create employment opportunities at an acceptable wage
level for the attainment of self-sufficiency.
These 3 specialized categories are all short term grants (1-2 years).
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Districts are required to obtain approvals from
the Chancellor’s Office prior to amending the
district program budget.
Funds allocated by the Board of Governors under
this provision shall not be used by the
community college districts to supplant existing
courses or contract education offerings.
Expenditures should be properly accounted for in
the respective object codes. Assign direct and
indirect costs as outlined in the grant agreement.
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Background
The Jobs for Veterans Act (JVA) requires that
there be priority of service for veterans and
eligible spouses in any workforce
preparation, development, or delivery
program or service directly funded in whole
or in part, by the U.S. Department of Labor
(38 U.S.C. 4215).
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Criteria
◦ Public Law 107-288
◦ Workforce Investment Act (WIA)
◦ Employment Development Department
(EDD) Directive Number WSD08-10
◦ U.S. Department of Labor:
http://wdr.doleta.gov/directives/attach/TEN/ten2010/ten15-10a1.pdf
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WIA Nursing and Allied Health Grant Recipients
are required to provide priority admission to
eligible veterans and their spouses when WIA
monies are used as the source of funds for the
Request for Applications (RFA).
Not all RFAs have WIA as their source of funds
therefore, if the source of an RFA is non-WIA, the
priority accorded to veterans, while always
encouraged, is not required.
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Districts should have adequate policies and
procedures to comply with the Jobs for Veterans
Act (JVA) which includes:
◦ Indentifying and informing covered persons with
timely and useful information on priority of
service.
◦ Providing preference to covered persons in
programs that are WIA funded. The individual
must first qualify or meet the specific program
requirements before the priority of service is
applied.
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 A “covered person” is a veteran or spouse of
an eligible veteran who has served at least
one day in the active military, naval, or air
service, and who was discharged or released
from service under any condition other than
a condition classified as dishonorable.
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Eligible Spouse is defined as the spouse of any of the
following:
1. Any veteran who died of a service-connected disability
2. Any member of the Armed Forces serving on active duty
who, at the time of application of the priority, is listed
in one or more of the following categories and has been
so listed for a total of more than 90 days:
i. Missing in action
ii. Captured in the line of duty by a hostile force
iii. Forcibly detained or interned in line of duty by a
foreign government or power
3. Any veteran who has a total disability resulting from a
service-connected disability, as evaluated by the
Department of Veterans Affairs:
4. Any veteran who dies while a disability, as indicated in
(3) above, was in existence.
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Background
◦ Basic Requirements for “To Be Arranged Hours” or
“TBA” as Part of a Course
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TBA Definition
◦ Some courses with regularly scheduled hours of
instruction have “hours to be arranged” (TBA) as
part of the total contact hours for the course. The
TBA portion of the course uses an alternative
method for regularly scheduling a credit course for
purposes of applying either the Weekly or Daily
Census Attendance Accounting Procedures
pursuant to title 5, sections 58003.1(b) and (c),
respectively.
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TBA Definition cont.
◦ TBA hours are only an option for credit courses that
apply the Weekly or Daily Attendance Accounting
Procedures and not to those that apply the
Alternative Attendance Accounting Procedure
pursuant to title 5, section 58003.1(f) (i.e., Distance
Education courses not computed using other
attendance accounting procedures, Independent
Study courses, and Cooperative-Work Experience
education courses).
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Criteria:
◦ Second To Be Arranged (TBA) Hours Follow-up
Memorandum, June 10, 2009
◦ To Be Arranged (TBA) Hours Follow-up
Memorandum, January 26, 2009
◦ Education Code sections 84040 and 88240
◦ CCR, title 5, sections referred to are 55002,
55002.5, 53415, 58000, 58003.1, 58006, 58020,
58030, 58051, 58056, 58102, 58104, 58108,
58168, 58170, 58172, 59020, and 59112.
◦ Student Attendance Accounting Manual
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Districts are required to list TBA hours in the
schedule of classes, and describe them in the
course outline.
Districts need to track student participation
carefully and make sure that they do not
claim apportionment for TBA hours for
students who have documented zero hours as
of the census point.
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Supporting documentation, such as actual
attendance rosters or electronic attendance
tracking records, will need to be retained by
the district as it relates to verifying
compliance with this requirement as a Class 3
record basic to audit as required by section
59020 et seq.
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Determine that a clear description of the
course, including the number of TBA hours
required, is published in the official general
catalog or the addenda AND in the official
schedule of classes or addenda thereto.
Specific instructional activities, including
those conducted during TBA hours, expected
of all students enrolled in the course are
included in the official course of outline.
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Cont.- All enrolled students are informed of
these instructional activities and expectations
for completion in the class syllabus or other
document.
Determine the apportionment and attendance
record compliance as of census date by
reviewing supporting documentation such as
the attendance roster.
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Background
◦ Districts internal fiscal controls should ensure that
state apportionment for credit courses is only
claimed for student attendance by statute and
regulation. Student residence at the time of
registration is a major factor for allowing districts
to claim state apportionment for credit courses.
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Criteria:
◦ Education Code Sections 68000-68044, 6805068080, 68082,68100,68130, 76140, 76140.5, and
76143
◦ CCR, title 5, sections 54000-54072
◦ California Community Colleges, Student Attendance
Accounting Manual (SAAM)
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Test the supporting residency documentation
(hardcopy and/or electronic) of a sample of
students in credit courses to determine
whether each student has been properly
classified as either a “resident or a
“nonresident”. The resident questionnaire
used by the district in making residence
classifications must require students to
certify their answers under oath or penalty of
perjury.
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(Expansion)
◦ Test a sample of student-athletes in credit courses
to determine if residency status has been properly
classified. A student-athlete is a participant in an
organized competitive sport sponsored by the
district/college in which he/she is enrolled.
 Compare the student’s admission application and
residence questionnaire to the athlete’s Commission of
Athletics Form 1 for applicable information and confirm
consistency.
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Review the selected credit course section
tabulations for the students in the above
samples to determine whether the attendance
of nonresidents has been inappropriately
claimed for State support.
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280.01 (3)
◦ Identification of questioned costs and how they
were computed. If a dollar value is unable to be
quantified, provide an explanation.
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310.04
◦ GASB 54 – may be adopted for information
presented in government fund format, such as in
the supplementary information, as of the 2010/11
fiscal year. GASB 54 is not applicable to the BTA
model used by community college district for entity
wide financial statements.
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331- Auditor’s Report on State and Federal
Compliance has been revised to read
◦ “Auditor’s Report on State Compliance”
◦ The federal compliance requirements are separate
from the state compliance items.
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410
◦ .05-The auditor should follow current sample size
guidance provided by the AICPA and Generally
Accepted Auditing Standards (GAAS)
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410
◦ .06-Auditor should use professional judgment and
due diligence in designing the types of compliance
tests performed.
◦ .07-Categorical Flexibility- districts are required to
hold a public meeting to discuss redirection of
funds. Districts exercising flexibility are relieved of
statutory requirements, but are still required to
report expenditures to the Chancellor.
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420
◦ .08 American Recovery and Reinvestment Act
(ARRA) – Accounting for ARRA funds provided by
the Chancellor’s Office through the State Fiscal
Stabilization Fund (SFSF) Program
 ARRA funds have specific expenditure restrictions and
must be tracked separately. Although the federal
government has restricted these funds and the state
opted not to place further restrictions, they do not
have to expended on any particular program.
 Accounted for in the General Fund – Restricted in
accordance with the Budget and Accounting Manual.
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Concurrent Enrollment of K-12 Students in
Community Colleges
◦ 07-08
◦ 08-09
21 Findings
31 Findings
◦ 07-08
◦ 08-09
11 Findings
12 Findings
◦ 07-08
◦ 08-09
9 Findings
8 Findings
Student Fee Instructional Materials and Health
Fees
Students Actively Enrolled
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Chancellor’s Office sends the district a letter
to request a more detailed action plan to
prevent a repeat finding in subsequent
audits. The plan should include:
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Steps planned to prevent a repeat of the finding
Person responsible for implementing the change
Due date for the change to be in place
Status to date of the steps in place to create the
change
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If there are overstated in understated FTES
related to any findings mentioned, the district
should submit a CCFS317 to correct the
district’s FTES numbers.
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Questions?
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