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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Fiscal Management Post-Payment Audit Report Summary
University of Houston – Downtown
Fiscal 2011 Fourth Quarter

Audit scope

A sample was audited of the University of Houston – Downtown’s (University’s) payroll and purchase transactions and all of the travel transactions that processed through the Uniform Statewide Accounting System (USAS) during the period beginning March 1, 2010, through Feb. 28, 2011.

A limited sample of payroll deductions and book and reference material transactions for the same audit period was also reviewed.

Each transaction was audited to determine compliance with applicable state laws.

Payroll transactions and deductions

Payroll transactions were audited for compliance with the General Appropriations Act (GAA), the Texas Payroll/Personnel Resource and other pertinent statutes.

The following were identified in the payroll transactions audit:

  • Four instances of the University incorrectly calculating overtime pay

A limited number of payroll deductions were reviewed. The following error was identified:

  • Missing deduction form for a University employee

Purchase transactions

Purchase transactions were audited for compliance with the GAA, eXpendit, the State of Texas Procurement Manual and other pertinent statutes.

The following issues were identified:

  • Five transactions in which the University could not verify the rates invoiced
  • Two transactions where the University paid more than what was stated on the purchase agreement

A limited audit of book and reference material transactions from the purchase group was conducted.

  • No issues were identified from the audit of these transactions.

Prompt payment law and scheduling rule

The University’s compliance with the prompt payment law and scheduling rule was audited. The University paid $1,078.26 in prompt payment interest during the audit period.

The following issues were identified:

  • 15 purchase transactions were paid late without paying interest to the vendors
  • Interest was paid too early for two purchase transactions and caused a loss of interest to the State Treasury

Travel transactions

Travel transactions were audited for compliance with the GAA, Textravel and other pertinent statutes.

  • No issues were identified from the audit of travel transactions.

Internal control structure

The University’s internal control structure was reviewed. The review was limited to obtaining an understanding of the University’s controls sufficient to plan the audit and did not include tests of control policies and procedures.

Certain areas of risk involving the internal control structure and its operation were noted:

  • The University designated two employees with multiple security capabilities.

Fixed assets

A limited number of fixed assets acquired by expenditures during the audit period were selected to test for accurate reporting in the State Property Accounting System (SPA) and to verify existence of the assets.

  • All assets were located and the recording of the assets in SPA verified.

Prior post-payment audit and current audit recurring errors

A prior post-payment audit of the University’s payroll, purchase and travel transactions was issued on Dec. 4, 2006.

Recurring findings in the current audit include the following:

  • Prompt payment and scheduling errors
  • Missing payroll deduction form
  • Control weakness over expenditure processing
Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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