SUBOA Update Related Entity Guidelines April 2, 2015
Affiliates Task Force The Affiliates Task Force was charged with: o Whether all campus-related entities and affiliates should include at least one System Administration or Chancellor-designated board member. o o o o
Foundations ASCs/FSAs Alumni Associations Other related entities
o Whether there should be a required external or internal annual audit of all related bank accounts and entities, with copies of audit reports and management letters required to be sent to the University Auditor and University Controller. 2
DRAFT
SUNY Enterprise Research Foundation
Other RF Affiliates
50/50 Foundation/RF •Fuller Road Management Corp. •Buffalo 2020 Development Corporation •Downstate Technology Center, Inc. •Fort Schuyler Management Corp. •Long Island High Technology Incubator •SUNY Fredonia Technology Incubator, Inc.
Key RF: DLHC: SB: UB: DMC: UMU: CAO:
SUNY
CREs and OREs are governed by SUNY Policy, Guidelines and Contracts
Affiliates
Research Foundation Downstate LICH Holding Co., Inc. Stony Brook University at Buffalo Downstate Medical Center Upstate Medical University Chief Administrative Officer
SUCF
CREs Foundation Auxiliary Service Corp Housing Alumni
Affiliates Campus Related Entities Other Related Entities
OREs DLHC Upstate Property Development MedBest Others
Governed by Article XVI of Board of Trustees Policies
CPMPs SB, UB, DMC, UMU, Optometry
Affiliates
Affiliates Replacing Existing Policies and Guidelines with New Policy and Guidelines
New Policy and Guidelines now include
CAO Fund
Clinical Practice Management Plan
This chart does not include Student Government Associations.
Improving CPMP Oversight. Establishing New Requirements for CAO Fund .
3
Recommendations • Authorize the Chancellor to appoint board members to campus-related entities and their affiliates. • Extraordinary circumstances • In lieu of campus president or designee • On a temporary basis
• Authorize the Chancellor to appoint one or more board members to other related entities and their affiliates. • Enhance and clarify written guidelines for campus-related entities and their affiliates.
• Develop written guidelines for other related entities. • Develop written guidelines for the Chief Administrative Officer (CAO) Fund. • This applies to Clinical Practice Management Plans 4
Action Taken in Response to the Affiliates Task Force Recommendations • Developed an overarching Board of Trustees policy governing campus related-entities (i.e., Foundations, ASCs/FSAs, and Alumni Associations) and other related entities. • Enhanced and clarified specific guidelines that govern the activities of the campus-related entities and their affiliates. • Developed other-related entity guidelines. • Campus-related entities and other related entities guidelines include requirements on: – Structure and governance; – Accountability, compliance, and reporting; and – Linkage to campus.
• Specific guidance is being developed for the CAO Fund. 5
Campus Related and Other Related Entities Proposed Policy • Each Campus-Related Entity and Other Related Entity must be structured to assist the University in advancing and achieving its objectives, goals and mission. • The activities of these organizations must be properly conducted; provide for sound financial management practices; and provide for accountability, compliance and oversight. • The policy sets forth the framework for the applicable guidelines and requirements for these organizations. • Any exceptions to this policy and the related guidelines indicating that a requirement “should” be met must be approved in writing by the Chancellor or designee.
• No exceptions to any policy provision or guideline indicating that a requirement “must” be met will be granted.
6
Campus Related and Other Related Entities Proposed Policy, Cont’d • Enhancements and Clarifying Principles: o Prior to formation of an entity or an affiliate of a related entity a written plan outlining the structure, governance, purpose, initial and planned funding/capitalization must be approved by the campus President and the Chancellor or designee. o Entity Board must approve annual budget and audited financial statements. o Governance, including rules on composition of Board membership. o Comply with the Non-Profit Revitalization Act. o Operate in accordance with sound business practices with minimum standards established in guidelines. o The books and records, financial condition, operating results, and program activities are subject to periodic audit by the University Auditor. o The audited financial statements and audit reports, management letters and corrective action plans, with time frame, must be promptly provided to the campus President and the University Controller. o Annual certification to SUNY on compliance with the terms of the contract. o Meet all regulatory filing requirements on a timely basis. 7
Status and Next Steps •
• • • • • • • • • •
Guidelines for the campus-related entities were generally well received and acceptable. Draft Policy and Guidelines were posted on SUNY website and presented to Audit Committee in March. Objections and concerns were expressed by certain foundations prior to the meeting. No actions were taken on the policy or guidelines. Certain language in the policy and guidelines needed to be revised and clarified. Revised guidelines addressing the foundations concerns have been made. Need to share revisions with the Audit Committee for their review and approval. This is tentatively scheduled for end of April. Need to share revised guidelines with all groups (SUBOA, Foundations, Alumni Associations and ASCs). Need to share with the Office of the State Comptroller and Attorney General for their acceptance. Plan to present to Audit Committee final Polciy and Guidelines in June Need to address transition provisions for implementation (amend existing contracts?) 8
Enterprise Risk Management (ERM) • ERM Policy may soon be adopted by the SUNY Board of Trustees • System Administration roles and responsibilities to be defined – – – –
Leverage existing resources and guidance Internal Control Program Internal Audit Department Compliance Program
• Campus roles and responsibilities to be defined • Guiding principles once a risk area is identified: – – – –
Accept risk area/activity Avoid risk area/activity Outsource risk area/activity Mitigate area/activity 9
Questions
10