Arkansas State University - Jonesboro Study Abroad Special Review by The All State

Arkansas State University-Jonesboro Study Abroad Special Review

July 2016 Arkansas State University System Internal Audit

Table of Contents Purpose and Scope ...................................................................................................................................................... 1 Background .................................................................................................................................................................. 1 Study Abroad Management Assessment ................................................................................................................. 3 Recommendations and Responses ......................................................................................................................... 13 Comments .................................................................................................................................................................. 14

DATE:

July 25, 2016

TO:

Dr. Charles L. Welch, President

FROM:

Jo LunBeck Assistant Vice President for Administration

RE:

Arkansas State University-Jonesboro Study Abroad Special Review

PURPOSE AND SCOPE On March 15, 2016, Internal Audit (IA) received a phone report that relayed concerns involving two Arkansas State University-Jonesboro (ASUJ) study abroad trips: Nordic Trip 2016 and Lanjaron, Spain as well as the overall management of study abroad. The purpose of this report is to furnish the Arkansas State University (ASU) System President with an evaluation of the auditable concerns. The initial scope of the audit was defined as the period July 1, 2013, to April 30, 2016, except in cases where activities reviewed may have been documented at a date outside the defined scope. Information for the audit was obtained primarily through staff and faculty interviews, observations, examination of university account documents, and review of procedures deemed necessary to provide an analysis and comments concerning the following: 1. Compliance with Federal, State of Arkansas, and ASU regulations, policies, procedures, and guidelines; 2. Adequacy of documentation; and 3. Adequacy and application of accounting and operating controls. Because the review was based on limited tests of university records and related procedures, not all instances of control weakness, noncompliance, or operational deficiencies may have been discovered. Any issues, or comments, on items necessary to be addressed are listed in the Study Abroad Management Assessment section of this report.

BACKGROUND The ASUJ Office of Global Initiatives (OGI), located in the Office of the Provost and Vice Chancellor for Academic Affairs and Research, supervises a system of support that advances the universityâ&#x20AC;&#x2122;s academic mission by fostering research and other partnerships, recruiting international students, and developing opportunities for A-State students to study, conduct research, and work in internships in service-based learning abroad. The Executive Director of Global Initiatives (EDGI), Dr. Thilla Sivakumaran, reports directly to the Provost and Vice Chancellor for Academic Affairs and Research (PVCAAR), Dr. Lynita Cooksey. The Study Abroad Program was transferred to the OGI on April 1, 2015, and the Director of Study Abroad (DSA), Dr. Deidra (Dee Dee) Hudson, became the EDGIâ&#x20AC;&#x2122;s direct report. Previously, the DSA had reported to the PVCAAR since hired on May 1, 2013, as an Hourly Non-Student Extra Help staff. 1

The DSA is responsible for managing all logistical aspects of the study abroad programs and serves as the primary contact and source of information in the Office for Study Abroad for the programs. The DSA is assisted by a full-time Study Abroad Administrative Specialist II (SAASII), Ms. Jennifer Brightwell. Since a non-student extra help employee is not allowed to approve time and the Office for Study Abroad is located in close proximity to the University College, the SAASII reported to the Dean of University College, Dr. Jill Simons until March 16, 2016, when she became a direct report of the EDGI. As indicated in the chart below, 10 to 13 Study Abroad Programs and 5 to 11 Academic Exchanges were held each year from fiscal year 2014 through fiscal year 2016. Although the Study Abroad Programs and Academic Exchanges remained flat, or decreased, during fiscal years 2014 and 2015, student participation increased by 38% and 90%, respectively, during fiscal year 2016. Study Abroad Programs Kuwait Israel Lanjaron, Spain Japan Jordan China Belize Nicaragua Morocco Costa Rica London, England (Nursing/Health Care) London, England (HPESS/Athletics) Middle Eastern Studies Grant, Middle East Nordic - Finland, Sweden, Iceland Rotaract Club Trip, Brussels Rome, Italy Art Dept Trip Columbia

Total

Number of Student Participants FY2014 FY2015 FY2016 4 2 18 12 20 3 5 2 2 1 4 11 9 2 8 15 2 13 8 8 22 13 8 15 13 5 5 6 10 20 10 8 11

Academic Exchanges Korea University Justus Liebig University, Germany Tartu Ulikook, Estonia Unamerican University, Nicaragua Huelva Spring, Spain University of Southern Queensland, Australia API-Balboa, Spain Universite de Cergy-Pointoise, France Universidad de Vigo, Spain Universitat Rovira I Virgili, Spain Universidad de Murcia, Spain Johannes Kepler Universitat Linz, Austria Canterbury Christ Church University, England Sodertorn University, Sweden Universita Cattolica del Sacro Cuore, Italy Ulster University, Ireland Phillips-Universitat Marburg, Germany UAS7, Germany Universidad Publica de Navarra, Spain University of Wroclaw, Poland Universidad de Salvador, Argentina

117

Number of Student Participants FY2014 FY2015 FY2016 1 1 1 1 6 7 1 1 1 1 1 1 1 1 3 3 1 1 1 1 1 1 1 1

Total

After IA reviewed the reported information, the following auditable concerns were identified: 

A part-time temporary employee manages study abroad, and trips are unorganized;



Students are paying for an ASUJ Nordic study abroad trip to a PayPal account;



The instructor for the Nordic study abroad trip has no contract with ASUJ and is scheduled to teach for the Lanjaron study abroad session; and



Multisense España (Multisense), a third-party vendor in Lanjaron Spain, that has facilitated programs since 2013 as a third-party vendor, has no written agreement with ASUJ.

STUDY ABROAD MANAGEMENT ASSESSMENT

Approach Information was requested for several study abroad programs to develop a control group. Primarily, the review focused on the organization, management, and operations of the Nordic and Lanjaron, Spain study abroad trips to determine the validity of the auditable concerns. IA requested and reviewed the following:  

   

Policies, procedures, standard forms, and/or manuals used in administration of study abroad programs; List of study abroad programs provided during the scope of the review, including the beginning and ending dates, itinerary/locations, the name of the instructor/instructor of record, program leader, and any other official party members, the relevant course/section numbers in which campus academic credit was provided, copies of curriculum/syllabus/assessment, and the names and student ID numbers of all program participants; Applicable contracts, memorandums of understandings (MOUs), and/or written agreements, and/or contracts for study abroad including program costs/fees; Banner Finance study abroad accounts, budgets, and supporting documentation; Available online student information related to Nordic Trip 2015 and 2016; and ASUJ employment records as applicable.

In addition to reviewing the items listed, IA held meetings with the PVCAAR, EDGI, DSA, SAASII, Executive Assistant to the Provost (EAP), Honors Program Director, Assistant Vice Chancellor for Human Resources (AVCHR), OGI Budget Coordinator (BC), and eight ASUJ study abroad faculty members. An EthicsPoint Case_31 report was received during fieldwork for the ASUJ Study Abroad Special Review. Information gathered is common to both management assessments.

Results IA noted several operational issues and inconsistencies as detailed under each reported issue below. Reported Issue 1: A part-time temporary employee manages study abroad, and trips are unorganized. The job description (Attachment I) for the DSA supplied by the EDGI states: “The Director of Study Abroad at Arkansas State University has comprehensive programmatic oversight and daily management of Study Abroad…” The job description also includes 14 duties and responsibilities as well as 9 minimum qualifications that are currently being addressed and/or managed by the DSA in an extra help position that is required to work no more than 1500 hours per year. Arkansas Code Annotated (A.C.A.) § 6-63-314, Extra Help Restrictions, states: “No employee of an institution of higher education who is employed as extra help may be employed for a period of time to exceed one thousand five hundred (1,500) hours per fiscal year.”

Furthermore, the ASU System Operating Procedure, Effective July 1, 2013 (revised 4/8/2014), Subject: Maximum Working Hours for Employees who are not in a Position that is Benefits Eligible, states: “… Any other employee who is not in a benefits eligible position, including part time, or extra-help, may work no more than twenty-nine (29) hours per week, and no more than one thousand five hundred (1,500) hours per year.” ASUJ Banner Human Resources reports indicate the DSA worked less than 1,500 hours threshold each fiscal year from July 1, 2013 to April 30, 2016, at 973; 1,198; 1,116; and 1,080 hours, respectively. The DSA’s salary is reported as $28.36 an hour. In meetings with various campus management, IA was informed the ASUJ Chancellor (Chancellor), Dr. Tim Hudson, advocated for the DSA position to be a full-time position. Both, he and the DSA expressed concerns to the PVCAAR that the number of hours the DSA is required to work could possibly exceed the number of hours allowed and that the position had grown to the point that it should be a full-time position. On November 16, 2015, the ASUJ Executive Council approved a position request made by the PVCAAR for a full-time Director of Study Abroad (Research Assistant) with an increase of $12,858 in salary from $37,142 for the prior full-time DSA to $50,000 for the current full-time position posted. The Chancellor abstained from voting or initialing the approval. In an email at 7:01 p.m. of the same day, the Chancellor requested the following from the AVCHR: “…Can you give me a list of all non classified [sic] staff (except for auxiliaries and athletics) that have the working title of ‘director’ or associate/assistant director’ with base salary please …” In an email dated November 24, 2015, the AVCHR provided the Chancellor with two spreadsheets of the requested information attached: one sorted by working title and one sorted by salary. On December 7, 2015, or December 8, 2015, the EDGI found an envelope on his desk from the Office of the Chancellor, with a handwritten “Hudson” in the corner and “Confidential, Dr. Sivakurmaran, Intl Programs” (Attachment II) in the center on the outside of the envelope. Inside the envelope were 3 taped together pages of a spreadsheet with a Post-It note that stated, “Thilla – Interesting Data.” and initialed TH (Attachment III). Once opened, the pages displayed an edited, printed version of the spreadsheet provided by the AVCHR on November 24, 2015. On the spreadsheet, circles were drawn around 7 Directors’ titles and salaries, ranging from $54,073 to $66,420. The Director of Parking Services listed at $54,073 had a “?” drawn beside it (Attachment IV). The AVCHR approved the requisition for the position on January 14, 2016. The EAP approved the requisition on behalf of the PVCAAR on January 26, 2016, and the Assistant Vice Chancellor for Budget Planning and Development (AVCBPD) approved the requisition on January 27, 2016. The position was posted for application on January 27, 2016, for 10 business days, excluding a holiday. The EDGI notified the DSA of the full-time position posting; however, the DSA’s application was not submitted before the deadline, and the AVCHR extended the application posting until February 11, 2016, at the request of the OGI BC. On February 11, 2016, the DSA emailed her resume to the PVCAAR, “Subject: application,” that stated:

“completed [sic] twice…submitted and would not send. submitting [sic] now in this format.” The PVCAAR forwarded the email to the AVCHR on February 11, 2016. On February 16, 2016, the Vice Chancellor for Finance and Administration ( VCFA) called and emailed the ASU System President to provide information regarding the Employee Disclosure/Certification and Employment of Family Members Form (Disclosure) completed by the DSA on July 29, 2013. The Disclosure indicated on page 2 that the DSA “Cannot be Hired” due to a response on Question 7 that indicated she was a relative of the Public Official in charge of the agency to which she was applying. The VCFA was advised later the same day in a phone call from the ASU System President that the General Counsel had advised that the DSA cannot be a full-time employee; however, she can remain employed in the extra help position. Arkansas Code Annotated (A.C.A.) § 25-16-1002, Prohibited employment of relatives, states: “a public official shall not appoint, employ, promote, advance, or advocate for appointment, employment, promotion, or advancement in or to a position in the state agency in which the official is serving or over which the official exercises jurisdiction or control, any person who: (1) Is a relative of the public official; and (2) Is an employee of a state agency or as a result of the public official’s action would be an employee of a state agency. …” An employee is defined in A.C.A. § 25-16-1001, Definitions, as: “(1) ‘Employee’ means a person whose employment is not seasonal or temporary and whose actual performance of duty requires one thousand (1,000) or more hours during a fiscal year; …” The VCFA met with the Chancellor on the morning of February 17, 2016, to discuss Office of Personnel Management (OPM) policy on spousal employment. In an email dated, February 17, 2016, from the DSA, to the PVCAAR and copied to the EDGI and AVCHR, the DSA stated the following: “I wish to withdraw my application for the position of Director of Study Abroad at Arkansas State University effectively immediately. …” The Chancellor asked the PVCAAR to cancel the full-time Director of Study Abroad (Research Assistant) position posting which was conveyed to the AVCHR. The AVCHR cancelled the position, and electronic notifications were sent to the additional fourteen applicants for the full-time DSA position. Therefore, the study abroad programs continue to be managed by the DSA in an extra help position. IA noted the following inconsistencies in the management of the study abroad programs: 1. The Guide to Faculty Led Group Programs provided by the SAASII contained track edits with references and links to the University of Alabama Website;

2. The version of the Faculty-Led Study Abroad Programs Handbook (updated in 2014) provided by the DSA on April 26, 2016, was not the same as the Faculty Handbook for Study Abroad, dated Spring of 2014, posted at www.astate-sa.terradotta.com. 3. The $50 student application fee for Study Abroad Programs is not consistently collected. The $50 application fee, presented in Resolution 14-39, was approved by the Board of Trustees at the September 19, 2014, meeting and is used to cover the TerraDotta annual operating license. 4. A review of the Study Abroad Programs Banner Finance account information reflected financial activity for 19 of the 33 study abroad programs held during fiscal years 2014 to 2016. Transactions were noted for 1 study abroad program (OperaMaya) that was not on the list provided by the SAASII. The transactions varied from a one-time small dollar amount, e.g. for insurance for one program to several larger dollar amounts for other programs that included application fee, tuition, flights, lodging, instruction, etc. The financial activity for the remaining 14 programs was handled through the various accounts for the department that facilitated the programs not the Office for Study Abroad. 5. In an email dated April 30, 2016, the DSA requested 9 faculty members (who either facilitated, or are scheduled to facilitate in the current year a program that is handled through the Office of Study Abroad) provide the following documents related to the study abroad programs they facilitated from July 2013 to present: syllabi; agreements with providers, research institutes, and language institutes; and/or invoices if no written agreement exists. IA received the following for the 33 programs held during fiscal years 2014 to 2016: 7 syllabi; 2 signed agreements and 2 unsigned agreements (in process for 2016); and 8 invoices. 6. Student tuition payments for the Lanjaron Study Abroad trip were posted as revenue to either the Study Abroad Program carryforward fund (134152) or the Study Abroad-Lanjaron carryforward fund (133905), and the student tuition payments for the remaining study abroad trips were electronically transferred to the corresponding termâ&#x20AC;&#x2122;s Educational and General Fund (110000) as is other tuition payments for ASUJ credit courses. In fiscal year 2014, the net student tuition payment deposited to the Study Abroad Program carryforward account totaled $49,368. In fiscal years 2015 and 2016, the net student tuition payments deposited into the Study Abroad-Lanjaron carryforward account totaled $34,560, and $63,000, respectively. The tuition amounts stated above are paid in addition to the amount paid for the studentâ&#x20AC;&#x2122;s travel expenses. The PVCAAR, EAP, and Controller indicated the Lanjaron Study Abroad trip tuition payments were processed differently than the tuition payments for the other study abroad programs to pay for expenses associated with the program. 7. Out of the 17 study abroad sites reported to IA, the DSA traveled primarily to Lanjaron, Spain (4) and London (1) study abroad sites from July 1, 2013, to April 30, 2016: 7.1 July 22, 2013, to July 24, 2013 - $1,141.96 (Travel Reimbursement [TR1] $676.66, Requisition $465.30); Purpose: Professional meeting regarding scholarships and fellowships (Atlanta, Georgia).

7.2 January 29, 2014, to February 5, 2014 - $1,351.72 (Requisition $1,288.40, Rental $63.32); Purpose: Travel – Airfare from Memphis to Lanjaron, Spain. 7.3 June 2, 2014, to June 2, 2014 - $65.19 (TR1); Purpose: To make sure London nursing students made it to airport for flight (Memphis, Tennessee). 7.4 June 17, 2014 - $164.26 (TR1); Purpose: To review Lanjaron Study Abroad trip. (An associated travel reimbursement dated June 9, 2014, to July 2, 2014, - $1,556.90 for airfare from Memphis, TN to Lanjaron, Spain was denied. The DSA reported no hours worked on her time sheet until July 1, 2014 and July 2, 2014.) 7.5 October 29, 2014, to October 30, 2014 - $308.38 (TR1); Purpose: To attend a conference hosted by Randy Best [Academic Partnerships]. At the conference will be representatives from South Africa. We are trying to establish a working relationship for a study abroad opportunity in South Africa (Dallas, TX). 7.6 February 9, 2015, to February 17, 2015 - $1,580.05 (Requisition $1,266.20, TR1 $250.04, Rental $63.81); Purpose: Going to get things set up for Lanjaron Study Abroad trip and be there through Welcome and Orientation. 7.7 March 20, 2015, to March 29, 2015 - $4,604.57 (TR1 $4,623.87, Rental $88.00 – paid by Student Affairs, Returned by DSA $107.30); Purpose: Review housing for study abroad students; build relationships with study abroad sites including King’s College, Canterbury Christ Church University, Richmond – The American University in London., and Roe Hampton University; Meet with Lanjaron students in London (London, England). After ASUJ made payment to the DSA on May 21, 2015, the DSA returned $40.10 on July 10, 2015, for mileage claimed to the Little Rock, Arkansas airport instead of the Memphis, Tennessee airport. The DSA returned $67.20 on July 7, 2016, because the mileage to Memphis, Tennessee airport was claimed in error since a rental car was used for transportation to the airport. 7.8 February 16, 2016, to February 23, 2016 - $1,481.05; (Requisition $1,329.56, TR1 $32.02, Rental $66.20 and $53.27 – paid by Student Affairs). Purpose: going to Lanjaron, Spain to welcome AState Lanjaron Study Abroad group and help the new Program Manager get everything set up. Note: The amounts presented do not reflect any charges paid through program fee direct bill. In an email dated December 10, 2015, the DSA was asked by the EDGI to please explain the purpose of the DSA’s travel for the Lanjaron, Spain experience. On December 14, 2015, the DSA responded: “Because this program is housed with out [sic] the support of a university and staff, I act as that support for the first week. In that most of our students and one of our professors do not speak Spanish, I feel more confident greeting them and getting them settled. I also set up the office and classrooms, orient the assistant and meet with the Spanish instructors and local lecturers negotiate prices for the following year and handle any in person discussions that need to happen. I also meet with the mayor and the staff from the ministry of tourism as a courtesy to our university and program.”

Reported Issue 2: Students are paying for an ASUJ Nordic study abroad trip to a PayPal account. Marko Korkeakoski (Marko) facilitated a Nordic Study Abroad in May 2015, and his final date of employment with ASUJ was June 30, 2015. Per a note on a Human Resource document, Marko’s visa expired, and he could no longer work for ASUJ after August 17, 2015. On January 14, 2016, through January 23, 2016, Marko traveled and was reimbursed $685.41 by ASUJ for a round trip flight from Helsinki, Finland to Memphis, Tennessee on February 4, 2016. In an email dated, January 27, 2016, the SAASII informed an ASUJ Procurement and Travel Department representative the following related to Marko’s reimbursement: “He came to Jonesboro to hold information meetings for the Nordic Study Abroad program he is facilitating and to meet with …[DSA] on the Spain trip he will be helping to facilitate. No he is no longer an A-State employee…” On January 19, 2016, the Chair of the Department of Management and Marketing for the College of Business emailed a business list of faculty the following: “Subject: Nordic Studies 2016 …Please let your students know that there are two information sessions this week on the Nordic Studies opportunity May 11-June 5. The trip will include international project management study at Helsinki Metropolia University and business tours in Finland, Sweden, Estonia and Iceland. More information is available at www.nordictrip2016.com. Students may earn credit for MGMT 3193 Social Impact Management and/or MGMT 4123 International Management. Marko Korkeakoski will lead this trip again this year and he is here this week to promote the trip. He can come to your classes and talk about the trip if you wish and please let students know that there will be two information sessions as well. 2:00 p.m. Wednesday, January 20, in BU 423 7:00 p.m. Thursday, January 21, in BU 423 Please spread the word about this great trip! …” Marko made the arrangements for the Nordic Studies 2016 study abroad and conducted student meetings with the knowledge of the DSA; but without communicating the details to the DSA. On January 22, 2016, after his visit, the DSA emailed him the following: “It was great to see you… would you send me the application process that you gave to potential students. Will they fill out only the study abroad app? What is the application deadline? Deposit? Payment schedule? Is there a maximum number?

Sorry… Should have gotten this before you left.” On March 14, 2016, the EAP emailed the DSA the following: “…Can you help me, please. Is this something being handled out of Study Abroad? If so, why are students paying on a pay pal account and not through the University Finance account as other trips. …” The DSA responded the same date: “Ok. We are working on this. Should have been set up through ASTATE account. Will talk to professor and see where we are and get back to you.” In an email to the DSA and SAASII, dated March 14, 2016, Marko stated: “The reason why I asked students to use either my PayPal, (which is very secure and it has insurance against fraud) or send the check to my bank … was that there are around 30 different entities that I need to pay, and many of them do not accept credit card payment. …some things like public travel passes, etc. will be paid in cash when I pick them up.” ASUJ Operating Procedures, Number 05-11, Section: Finance and Administration, Subject: Cash Receipts – Regulations, Item 2, states: “All deposits are to be made intact at the cashier’s window; no part may be used for any other purpose such as making refunds, providing cash for establishing change funds or paying bills or expenses of any kind.” In an email to 17 business students later in the day on March 14, 2016, Marko, stated: “…all payments that are ASTATE Study Abroad related need to go through ASTATE accounts…” On March 15, 2016, the DSA provided the following additional information to the EAP: “As you are aware, we are working to rectify this matter. It seems a situation of a faculty member taking lots of ownership with out pursuing the proper channels. He is aware to be more communicative with his ideas and aware of appropriate protocol. …[SAASII] will send you the program fee amounts and what has been paid thus far into the Pay Pal account. She is working with Marko to have all of these funds transferred to the ASTATE Nordic Studies account asap. Marko has informed all students to make all future payments to the ASTATE Nordic Studies account. …[SAASII] will keep careful records and document the movement of funds. Marko has invoiced the program to make sure funds are in place to make the payments that are required for the program. He will keep concise records and submit them to reconcile the account. We will keep you informed of the situation. Thank you for informing me of this issue.”

The information provided indicated 8 students made payments of $1,950, and 2 students made payments of $1,750, into Marko’s PayPal account for Nordic Studies 2016 totaling $19,100. Marko explained to the SAASII on Tuesday, March 29, 2016: “…I had used my card with Stockholm accommodation booking around two weeks ago so at the moment there is not enough for $19,100. I was hoping Lanjaron money would have arrived already but at least it was not this morning. Allyson promised to take care of the check as soon as the money would arrive. Should I ask her to do one for check for now and rest ($1950) when the money arrives? …” On Tuesday, March 29, 2016, a cashier’s check made payable to ASUJ for $17,150 from Marko’s Jonesboro, AR bank was deposited to the Banner Finance Study Abroad account, and on Friday, April 1, 2016, Marko mailed a request for the Cashier Supervisor to debit his bank card for the remaining $1,950. The debit was made on Monday, April 4, 2016. Reported Issue 3: The instructor for the Nordic study abroad trip has no contract with ASUJ and is scheduled to teach for the Lanjaron study abroad session. At the date of the issue report, ASUJ did not have an official agreement for Nordic Studies 2016 with the Helsinki Metropolia University of Applied Sciences in Helsinki, Finland, where Marko is employed. The original intent was to contract directly with Marko to facilitate the program as the DSA had previously done for his Lanjaron faculty assignment in February 2016; however, after contacting the ASU System Associate General Counsel, IA was advised ASUJ could not enter into a contract with Marko without being in noncompliance with A.C.A. § 19-11-709 (d) (1) that states, “It is a breach of ethical standards for a former employee, unless the former employee’s last annual salary based on the state fiscal year did not exceed fifteen thousand dollars ($15,000), to engage in selling or attempting to sell commodities or services, including technical or professional consultant services, to the state for one (1) year following the date employment ceased.” Note: The salary amount paid to Marko by ASUJ in fiscal year 2015 exceeded $15,000. Therefore, the ASU Office of Study Abroad was in noncompliance when the January 21, 2016, Lanjaron, Spain Study Abroad contract (Lanjaron contact) with Marko was signed. The Contract for Services, Item 1 Description of Services, and Item 2 - Payment, stated respectively: “1. Description of Services. Beginning on March 31, 2016, Marko Kokeakoski will provide to A-State Office of Study Abroad the following services (collectively, the ‘Services’): 

Teaching of 3 hour Special Topics course (Business in the EU) for 25 days in Lanjaron, Spain.



In return, A-State Office of Study Abroad will provide: reimbursement of airfare to/from Spain, all ground transfers in Spain, single room accommodations on-site with students,

breakfast, laundry (4 times), program cell phone, and all fees associated with academic excursions. o

Note: There is no daily meal per Diem paid for this program.

2. Payment. Payment shall be made to Marko Kokeakoski [sic], Helsinki, Finland, 00200, in the amount of $5,000 for services and $427.60 for airfare reimbursement, on or before March 31, 2016.” The Lanjaron contract was signed by the DSA and Marko without appropriate review by the VCFA as required by State of Arkansas, Title 19, Public Finance, Chapter 4 – State Accounting Procedures, which states the following related to the disbursing officer’s duties: A.C.A. § 19-4-1206 – Duties generally. “(a) The bonded disbursing officer for each state agency or the bonded disbursing officer for any regular or special fund provided for by the General Assembly shall be responsible and held accountable for the proper expenditure of the funds under his or her control. (b) It shall be the responsibility and duty of each disbursing officer or agent to: (1) Keep advised as to the availability of the appropriations and funds for which he or she is the disbursing officer and be informed as to the legality of and authority for any obligations which may be incurred before any disbursements are made; (2) Keep advised as to the laws or administrative regulations relating to general accounting procedures and restrictions for the disbursement of funds; and (3) Certify that: (A) Any disbursements which he or she may make are in accordance with the terms of any applicable contracts, purchasing procedure, or other authority; (B) The services have been performed or the goods received; and (C) The vendor or payee is entitled to the amount set forth in the check or voucher.” A.C.A. § 19-4-1207 Duty to monitor finances. “It shall be the duty and responsibility of the head of the agency for which appropriations are authorized and of the agency's disbursing officer to:

(1) Be cognizant at all times of the resources available, including applicable fund balances, revenues, and other income, for financing the appropriations authorized by the General Assembly; (2) See that no obligations shall be incurred which cannot be lawfully discharged from funds appropriated or available from other sources when they become due and payable; and (3) Not operate the agency during any fiscal year from the then-current fiscal year's available resources at a level of operations that would require for the succeeding fiscal year funds in addition to those already authorized by the General Assembly.” A.C.A. § 19-4-1210 Revenues insufficient to meet appropriations. “…The bonded disbursing officer for each agency shall be responsible and held accountable for the incurring of any obligations ...Each such disbursing officer is prohibited from incurring any obligations in excess of the funds made available…” The issue was reported to IA after the date the Lanjaron contract had been established; however, the VCFA, in coordination with the ASU System General Counsel, finalized a Study Abroad Program Agreement between ASUJ and Helsinki Metropolia University of Applied Sciences (Helsinki agreement) that included Helsinki faculty services for the period May 11, 2016, through June 6, 2016. The Helsinki agreement was signed by the VCFA on May 10, 2016, and the Head of Metropolia Business School on May 12, 2016. Reported Issue 4: Multisense, a third-party vendor in Lanjaron Spain, that has facilitated programs since 2013 as a third-party vendor, has no written agreement with ASUJ. In a meeting with the PVCAAR, EDGI, DSA, and SAASII on April 7, 2016, IA inquired whether there is a MOU with Multisense, the company that invoices for the Lanjaron Study Abroad program, and was informed that one does not exist since they are a third-party provider. IA asked if the services should be bid, and the DSA responded, “There is no bidding process because it is not a university.” Subsequently, IA emailed the Director of Procurement and Travel Services (DPTS) on April 22, 2016, to inquire whether Multisense is an approved vendor and whether ASUJ is required to bid the services of international, third-party vendors. On Wednesday, May 4, 2016, the DPTS responded: “…in my opinion there should have been an RFP done for this service and that a possible TSC (Technical/general services contract) or PCS (Professional/Consulting Services) contract done and reported to the state depending on the cost of the total services. We are now required by Act 557 to report all such contract to the state and depending upon total amount of contract – if could have to go for Legislative review. We are also required to have Vendor performance standards stated in all contracts and do quarterly Vendor performance reports.

…the major of this contract could be considered travel – since there is lodging, food, and travel for the students participating. But there are other charges that would need to be look at closely – payment for the teachers services and then the fees for other services and things. All of the charges that we have seen have come after the fact of the activity and have been paid by a wire payment. Because of this any requisition that might have been done – are found in the system as deleted with no documentation backing that requisition in the document imaging system. PCS: Expert/certified person performing a job – normally for architects, attorneys, doctors, etc. TSC: § 19-11-203(34): (34)(A) [sic] ‘Technical and general services’ means: (i) Work accomplished by skilled individuals involving time, labor, and a degree of expertise, in which performance is evaluated based upon the quality of the work and the results produced; (ii) Work performed to meet a demand, including, but not limited to, work of a recurring nature that does not necessarily require special skills or extensive training; or (iii) The furnishing of labor, time, or effort by a contractor or vendor, not involving the delivery of any specific end product other than reports that are incidental to the required performance.” IA requested on May 17, 2016, that the Associate General Counsel review the DPTS’s response. The Associate General Counsel advised: “…[DPTS] is correct to the extent that she states that the study abroad service requires a contract…and that an RFP should have been performed depending on the cost of the total services. However, in my opinion, this student travel is not the kind of travel that is exempt from procurement statutes because travel is generally for state employees in the course of their job duties. There is a specific provision for higher ed to provide for student athletes’ travel, but I did not find a provision for study abroad.” Therefore, Multisense expenses are considered not exempt from State of Arkansas Procurement Laws and Rules. Total wire payments made to Multisense for fiscal years 2014, 2015, and 2016, were $83,958.71, $72,069.24, and $94,676.93, respectively.

RECOMMENDATIONS AND RESPONSES IA recommends the following: 1. The ASU System Administration revisit the Chancellor’s request to cancel the full-time DSA position posting and evaluate whether a full-time DSA will mitigate the multiple operational issues and inconsistencies.

Response: ASU-Jonesboro campus administrators determined that a full-time Director of Study Abroad position is necessary in order to provide appropriate staffing time to satisfactorily manage the study abroad program. This decision was communicated to ASU System Administration and system administration concurs with the need for a permanent full-time position. The permanent full-time position opened on July 15, 2016. 2. The ASU System Administration address and remediate the noncompliance with State of Arkansas regulations and ASU policies, procedures, and guidelines, taking disciplinary action as deemed appropriate. Response: ASU System Administration agrees that significant efforts need to be made to address and remediate all incidents of noncompliance. The permanent full-time Study Abroad Director will be required to update and strengthen all program documents, develop clear study abroad policies and processes, and undergo training on all institutional and state regulations, policies, procedures and guidelines. ASU System legal counsel will review all program policy documents to confirm full legal compliance. No future activity or business will be conducted with Multisense, or with any other third-party study abroad vendor, until all applicable State of Arkansas and ASU regulations, policies, procedures, and guidelines have been fully satisfied. The part-time director position will be eliminated upon hiring of a full-time director. Anticipated start date for a new full-time director is August 22, 2016. (Attached is pertinent correspondence between the part-time DSA and PVCAAR.)(See Attachment V and Attachment VI.) COMMENTS The ASU System IA staff appreciates the cooperation, professional attitude, and prompt responsiveness of the Office for Academic Affairs and Research administration, faculty, and staff. If you have any questions or desire further information regarding any aspect of the program review, please contact me. cc: Board of Trustees Ms. Julie Bates Mr. Brad Phelps

Attachment I

Director of Study Abroad The Director of Study Abroad at Arkansas State University has comprehensive programmatic oversight and daily management of Study Aboard, a division within the Office of Global Initiatives. As a direct report to the Executive Director of Global Initiatives, the Study Abroad Director is responsible for managing all logistical aspects of the study abroad programs and serves as the primary contact and source of information in the Study Abroad office for these programs. Duties and Responsibilities: Coordinates all study abroad programs and oversees student exchange programs as assigned Advises perspective and current students about study abroad opportunities Recruits study abroad students and coordinates marketing and promotion of study abroad opportunities Manages study abroad admissions processes Maintains communication with program participants Assists students and faculty with program logistics and coordination, pre-departure orientation and ongoing support Assists with the development and acquisition of federal and state grants, scholarships, and other financial opportunities to assist study abroad students and faculty-led programs Works closely with stakeholder units on-campus (Admissions and Records, Financial Aid, University Communications, Academic Colleges and advisors, and other units) to ensure streamline procedures for study abroad and faculty-led programs including academic related matters associated with credit-transfer equivalences, foreign transcripts, financial aid awards, etc. Develops new and innovative programs for study abroad opportunities Manages study abroad related social and traditional media content Supervises an administrative assistant and interns/student workers as needed Provides oversight and management of budget Collects, analyzes and reports student data Fulfills other work-related duties as assigned Minimum Qualifications: â&#x20AC;˘ Doctorate with a minimum of three years of related experience in higher education with emphasis on study abroad â&#x20AC;˘ Demonstrated skills and experience in leadership and management of the financial, supervisory, technological and operational affairs of a complex

• • • • • • •

organization Excellent problem-solving and strong analytical skills with proven ability to strategize, prioritize, and multi-task to meet goals and deadlines Ability to communicate effectively in a diverse, multicultural work environment. Ability to manage a diverse portfolio of study abroad programs including university/faculty-led and exchange programs Experience collecting, analyzing, and accurately reporting data Demonstrated experience with crisis intervention and emergency response Understanding and support of the integration of study abroad with the teaching, research and service missions of higher education Knowledge of a second language and international experience; Familiarity with international political, social and cultural issues as they pertain to study abroad, international travel and international service

OFFICE OF THE CHANCELLOR

P.O. Box 600 • State University. AR 72467-0600

ARKANSAS STATE UNIVERSITY JONESBORQ

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Attachment II

Attachment III

Attachment IV

Attachment V

Attachment VI

ARKANSAS STATE UNIVERSITY

OFFICE OF THE PROVOST & ACADEMIC AFFAIRS & RESEARCH P.O. Box 179, State University, AR 72467-0179 I o: 870-972-2030 I f: 870-972-2036

July 12, 2016

Dr. Deidra Hudson Part-Time Director Study Abroad Program :::��!� versicy

I wanted to take this opportunity to thank you for your leadership as part-time director of Study Abroad. With your international educational background and expertise in study abroad, you stepped into this role and created a new vision for A-State's study abroad programming. Through your leadership, more students than at any other time in the university's history are engaging in life-changing international experiences. You have successfully grown the study abroad portfolio to include a semester-long cultural and linguistic immersion led by some of A-State's top scholars; restored former exchange partnerships while fostering new; arranged unique experiences for various disciplines and student groups; and developed program confidence with students, parents and faculty alike. Your commitment to making study abroad at A-State one of the university's greatest assets for investing in the personal and professional growth of our students has now reached beyond what can be managed through a part-time leadership position. We will be searching for a full-time director and hope to have this position in place by the start of the fall term. As we discussed, I would like for your continued assistance as the part-time director until which time the full-time position can be filled. The most pressing concerns will be to ensure that the needs of students returning or preparing for fall 2016 study abroad experiences are supported. I am grateful for the many positive improvements and additions that your leadership has provided to A State's study abroad program. You have brought A-State to a point that students no longer question whether or not study abroad is an appropriate option, but rather an expectation that study abroad is part of their A-State experience. You can be assured that your leadership and vision will leave a positive impact on students for years to come.

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Lynita M. Cooksey, Ph.D. Provost

LMC:jlc cc:

Dr. Thilla Sivakumaran Ms. Lori Winn Dr. Charles Welch educate• enhance• enrich

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