Occasionally, University units have difficulty in establishing or maintaining an appropriate and effective control environment. When the control environment in a University unit is materially flawed it can result in inordinate levels of risk and cost, both to that unit and to the University as a whole. In some cases this condition can prevent the department or college from achieving its mission. When ordinary measures have not resulted in needed improvements the unit will be designated for expanded intervention.

Expanded intervention is designed for units whose problems are judged to be so severe that they are incapable of continuing operations without placing the University in a position of unacceptably high risk. In those cases, immediate and broad-based intervention from others within the University is required to mitigate the risk and correct the problems.

The goal of expanded intervention is not to enforce sanctions on non-performing units in a punitive manner, but rather to ensure that the unit's specific problems are quickly remedied in a way which can be sustained.

Initiating the expanded intervention designation helps highlight serious internal control weaknesses and provides a means for reporting and monitoring those issues until corrective action is taken.

• Recommending a Unit for Expanded Intervention

There are no forms for this policy.

Subject	Contact	Phone	Fax/Email
Primary Contact	Gail Klatt	612-625-0150 612-625-1368	klatt003@umn.edu
Policy Questions	Office of Internal Audits	612-625-1368 612-625-1512 (fax)

Expanded Intervention
A designation given to University Units that have serious deficiencies in their internal control environment. It is used when ordinary corrective action measures have not been effective.

Corrective Action Plan
A document developed by administrative leadership that establishes specific strategies and actions planned to resolve serious internal control weaknesses within University Units.

Central Units
The following Offices are considered central units: President, Provost, Chancellor, other Vice Presidents, Office of Internal Audits, Budget Office, Office of Oversight, Analysis, and Reporting, Sponsored Project Administration, Institutional Review Board, Controllers Office, and the General Counsel's Office.

Specific Action Strategies
Steps taken to correct administrative, financial or operational deficiencies. These actions can include but are not limited to the following:

• Changes in administrative organization structure.
• Expanded education and training for unit personnel.
• Review and approval of all expenditures or commitments in excess of an established threshold by the Dean's Office, or an equivalent oversight level
• Monthly reporting of deficit situations and the status of related corrective measures to the Budget Office/CFO
• Reporting to the Board of Regents' Audit Committee describing the agreed upon corrective measures which will be taken
• Monthly status reports and updates to the appropriate Vice President and, through them, to the President of the University
• Review of monthly or quarterly financial statements by the next highest supervisory level for the unit
• Notification to the appropriate University foundation(s) of any expenditure limitations
• Enhanced review and oversight of sponsored activities by the Office of Oversight, Analysis, & Reporting (OAR)
• Assessment of the unit's work processes and organization.
• Assessment of the unit's management function and structure
• Assessment of the unit's ability to adapt to changes in its operating environment
• Assessment of staffing levels and competencies by appropriate parties and, if necessary, supplementing staff with the necessary skill sets or reassignment of responsibilities.

Associate Vice President - Internal Audit

• Recommend a unit for expanded intervention based on audit results. Initiate discussions with other central units to determine if similar problems are encountered when working with the unit and solicit their input for the Corrective Action Plan. Final designation will be done in consultation with the appropriate Dean and Vice President. The recommendation will be communicated as soon as possible so that the higher level of authority can participate in the audit reporting process, including the development of a Corrective Action Plan. The appropriate Dean and Vice President will be included as Addressees on the audit report.
• Recommend intervention steps to the Dean/Vice President.
• Send a copy of the audit report, in its entirety, to the Audit Committee and the President, accompanied by an explanatory cover letter from the Associate VP-Internal Audit.
• Notify other officials within the University. This could include, but is not limited to, the President, Provost, Chancellor, other Vice Presidents, Budget Office, Office of Oversight, Analysis, and Reporting, Controllers Office, and General Counsel's Office.
• Perform regular follow up procedures each quarter.

Board of Regents' Audit Committee

• Monitor progress via the quarterly follow up reporting provided by the Office of Internal Audits.

Central Units

• Recommend a unit for expanded intervention. Provide expanded review or monitoring as warranted.

Dean and Vice President

• Participate in the audit reporting process (i.e., discussion of audit findings and recommendations). Assist in the development of the Corrective Action Plan, and approve the final Plan submitted. If requested, meet with selected members of the Board of Regents Audit Committee to discuss the Corrective Action Plan and timelines for improvements. Provide ongoing oversight of financial, regulatory, or other agreed on matters. This may involve the actual preparation and/or approval of certain transactions, documents, or activities. Provide agreed upon status reports to the appropriate Vice President, SVP, or Provost or Chancellor (Dean) and to the President (VP, SVP, Provost, Chancellor).

President

• Stay abreast of the status and progress being made for all units under Expanded Intervention via periodic reports from the senior officials involved.

University Unit

• Develop and implement a Corrective Action Plan in conjunction with the Dean and/or Vice President.

There are no appendices for this policy.

There are no frequently asked questions for this policy.

• Board of Regents Policy: Internal Controls

Amended:

March 2007 - Audit Director changed to Associate VP - Internal Audit in contacts, and responsibilities section. Board of Regents' Audit Committee no longer has the responsibility to discuss the corrective action plan with unit head, Dean or VP. Dean and VP only have to meet with Board of Regents Audit committee upon request.

To obtain a copy of a historical policy, e-mail the U Policy Librarian at policy@umn.edu or call 612-624-4372.