Operations, Audit and Risk Committee Meeting September 14, 2023

The Operations, Audit and Risk Committee met on Friday, June 9, 2023 at 11:15 a.m. in the David Student Union Board Room with Chair Terri M. McKnight presiding.

Present from the Committee

Mrs. Terri M. McKnight, CPA, Chair (remote participation)
Mr. Robert R. Hatten, Esq.
Ms. Kelli Purdy Meadows, CPA
Ms. Lee Vreeland

Ms. Terri McKnight participated remotely by phone from Mexico. Remote participation permitted due to personal travel to Mexico pursuant to Code of Virginia § 2.2-3708.3(B)(4).

Other Board Members Present

None

Others Present

Mrs. Faith Belote, University Internal Auditor
Mrs. Jennifer Latour, Vice President for Finance and Planning/Chief Financial Officer
Ms. Christine Ledford, Vice President for Administration and Auxiliary Services
Mrs. Lisa Duncan Raines, Vice President for Enrollment and Student Success
Other CNU faculty and staff members
Ms. Linda Wade, APA Audit Director
Ms. Shaye Doherty, Audit In-Charge
Ms. Danese Seebourne, ISS Audit Manager

Chair McKnight called the meeting to order and welcomed everyone in attendance.

Approval of April 14, 2023 Minutes

Chair McKnight asked if everyone had a chance to review the Operations, Audit and Risk Committee minutes from April 14, 2023. There being no comments, edits or suggestions, Chair McKnight called for a motion to approve the minutes as presented. Mr. Robert Hatten, provided the motion, which was seconded by Ms. Lee Vreeland and the minutes were approved by unanimous vote of the committee.

Report from the Auditor of Public Accounts on the FY22 Financial Statements

Ms. Linda Wade presented the findings of the FY 22 Financial Audit which reviewed the Financial Statements and Revenues and Expenditures for the year, as well as internal controls and compliance. Ms. Wade was very complimentary of staff and thanked them for their cooperation. There was a discussion among the committee regarding the findings and staff left the room while deficiencies within the audit were discussed with the committee. Upon returning to the room, Chair McKnight commended Diane Reed’s (University Comptroller’s) staff on a job well done.

Chair McKnight introduced Mrs. Jennifer Latour, Vice President for Finance and Planning/CFO to provide the following report:

Administrative/Professional Faculty Compensation Study Update

Mrs. Latour reported that Human Resources conducted a compensation study for A/P (Administrative Professional) faculty employees to improve the compensation and retention rate of employees. The study began in November 2022 and 254 A/P positions were assessed which includes the athletics department. Based on the results, 5.1% have fallen behind the market. A blend of both private and public sector positions were compared to get these results. Athletics positions were compared to other Division III schools for the study. As a result, it was identified that 104 employees (41%) are eligible for an increase. The estimated cost for the increase is $700,000 and will be implemented on August 10, 2023.

Chair McKnight thanked staff for their work on the study and for making Christopher Newport University competitive in the marketplace.

Resolution 2: Award of Administrative and Professional Emeritus Status

Dr. Bob Colvin, Interim Chief of Staff presented Resolution 2 which awards Administrative and Professional Emeritus Status to retirees that have served with Distinction for 10 years or more and confers the title of Administrative/Professional Faculty Emeritus upon the following retirees, along with all the privileges pertaining thereto: William L. Brauer, served his alma mater for 29 years, Patricia McDermott, for 39 years, Beverley Mueller, 25 years, and Cynthia Perry, more than 40 years.

Chair McKnight called for a motion to approve Resolution 2 as presented. Ms. Kelli Purdy Meadows provided the motion, which was seconded by Mr. Robert Hatten, with all in favor.

Resolution 3: Amendments to University Retirement Plans

Mrs. Jennifer Latour, Vice President for Finance and Planning/CFO presented Resolution 3 which is a result of the Secure Act 2.0 which updates our current 403 B plan and allows participants to also make Roth elective deferrals. The amendments are effective January 1, 2024. Mr. Bobby Hatten made the motion to approve Resolution 3 as presented and Ms. Lee Vreeland seconded the motion, with all in favor.

Annual Security Report from the Information Security Officer

Mrs. Jennifer Latour noted that Mr. Andrew Crawford, Chief Information Officer has accepted a new position at William & Mary and is no longer with Christopher Newport University. Mr. Shane Leasure will serve as Interim CIO while a search is underway. Mrs. Jennifer Latour introduced Ms. Wendy Wilde to provide the Annual Security Report.

Ms. Wilde presented the Annual Security Report and provided information on the Gramm Leach Bliley Act (GLBA) and the requirements that will need to be put in place by June 9th. She reported on the Information Security Program, the IT Services Budget for FY 23, and Risk Summaries and University Response and Actions to the Committee.

Internal Audit Report

Ms. Faith Belote, Director of Internal Audit, presented the annual risk assessment and risk-based audit plan for Fiscal Year 2023-2024. The plan is based on the coverage of three internal audit positions. Resource estimates were calculated based on the objectives and scope of proposed audit engagements. Senior management input was solicited regarding the proposed internal audit plan before being presented to the committee.

Following the discussion among the committee, Ms. Belote proposed to the Chair that consideration be given to postponing the procurement of the electronic Audit Workpaper solution due to limited resources in the CNU Budget for FY 2024. Those hours allocated on the plan for software implementation could be utilized for the Endowed Student Scholarship audit. Chair Terri McKnight, presented the change to the FY 2024 Audit Plan for committee vote. Ms. Lee Vreeland made the motion and it was seconded by Ms. Kelli Purdy Meadows. The committee unanimously approved the changes to the FY 2024 Audit Plan.

Due to financial constraints, ITS and senior management formally acknowledged and accepted risk for three IT improvements necessary to meet the Security Standards addressed in the Disaster Recovery Planning and audit follow-up. The Deputy Chief Information Officer stated that resource allocations from the increased Technology Fee may provide the necessary resources required to mitigate risks and implement improvements during FY 2024.

Ms. Belote was unable to complete her report due to running out of time. Materials on the Audit Plan Status, remaining audit issues, and the upcoming quality assurance review are provided in BoardDocs.

The meeting adjourned at 12:26 p.m.