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| FAMU Auxiliary Fund Transfers Timeline (click to enlarge) |
An outside auditing firm FAMU hired to investigate the improper transfer of funds from the university’s auxiliary accounts to the athletic department turned up six instance in which the funds were improperly transferred. The final copy of the forensic audit placed the total dollar amount transferred at $2,687,768.66.
Auxiliaries are those funds that account for business units and activities that generate their own revenue –Housing, Dining Services, the Bookstore, Copy Center, and Vending Machines, to name a few. Florida Board of Governors, (BOG) which oversee the Boards of Trustees of each Florida public university, regulation specifically disallows the use of university auxiliary funds to support athletics.
Since 2013, FAMU has been actively managing a corrective action plan regarding its athletic cash deficit. The plan was updated in 2016 with the BOG to include a repayment of prior unallowable fund transfers from FAMU’s auxiliary accounts to Athletics.
The forensic audit uncovered, that no sooner had FAMU negotiated a repayment agreement with the BOG in September 2016, that it made two additional unauthorized transfers the first of which occurred in April 2017 and again in June 2017. The two transfers totaled $188,763 increasing the athletic deficit to $7,863,542.
In June 2018, the university, again, made two additional transfers from auxiliary accounts to athletics totaling $1,582,327. This increased the deficit to $9,245,384. On March 1, 2019, the FAMU Foundation made a $293,485 payment (its third payment since January 2017) to pay the athletic deficit down to $8,946,899 (as of June 30, 2019).
The last two transferred raised red flags with FAMU's internal auditors and lead to the forced resignation of FAMU's VP for Finance & Administration/CFO Wanda Ford, and the firing of Controller Tiffany Holmes, and Budget Director Ronica Mathis. The audit "determined that the latest two transfers of auxiliary funds to Athletics were conducted outside of University administrative processes, were transacted through management override of controls (in PeopleSoft). While, both the University CFO and President were required to transfer the funds, "only the approval of the CFO and Controller were identified with either of the two transfers."