Audit Management

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Best Practices for Surviving Audits
Audit Notification
Role of the Auditor
Role of the Central Administration
The Audit Process
Audit Tips

The comptroller of the University is the official contact for all audits. Sponsored Projects Services (SPS) acts as coordinator. Principal investigators and/or business managers will coordinate all audits of sponsored grants and contracts through SPS. If an auditor contacts you directly, please refer them to the director of Sponsored Projects Services. External auditors or investigators should not review documents or interview personnel without the involvement of these central offices. Any requests for audits or investigations from the FBI, attorneys, or any other investigators of law enforcement officials should be forwarded to the University of Arizona's Office of General Counsel.

Sponsored accounts are subject to audit by the following entities:

  • Federal agencies and their Offices of Inspector General
  • State of Arizona Auditors General
  • US Department of Health and Human Services' Cost Allocation Services
  • Arizona Board of Regents
  • Individual sponsors
  • University of Arizona Internal Audit Office

Best Practices for Surviving Audits

The best practices for surviving an audit do not start when an audit is already underway.  Good research administration should be practiced on a daily basis.  These best practices include:

  • Exercise due prudence when making a purchase
  • Conduct transactions at arm's length; did the buyers and sellers of a product act independently and in the interests of their institutions
  • All costs incurred must benefit the project directly and be necessary for the completion of the project
  • All costs incurred must be consistent with policies, regulations, and the terms of the contract
  • Document the business purpose of each transaction adequately
  • When questions arise about a particular cost/transaction department administrators must communicate with principal investigators to determine and record a detailed justification
  • Whenever questions arise please work with Sponsored Projects & Contracting Services to understand the specific terms and conditions of your project

Audit Notification

The audit agency or sponsor notifies the university of an audit by letter. The letter should clearly define the scope of the audit and the date. Sufficient lead time is necessary in order to pull appropriate documents and schedule office space for the auditor.

If you receive an audit request through letter, email or a phone call, please forward it to Sponsored Projects Services or call SPS and ask to be connected with the audit coordinator.

Please do not forward any financial or technical information directly to auditors without the involvement of SPS or Research, Discovery & Innovation

Role of the Auditor

Auditors are not "The Bad Guys." Auditors provide the important function of keeping the system in balance and protecting the public. Auditors also provide valuable feedback and advice to management for making improvements to the process.

Role of Central Administration

The central administrators from Sponsored Projects Services and the Financial Services Office play the role of host. They are the single point of contact between the auditors and institutional staff, coordinating interviews, monitoring the flow of information, and ensuring that the auditors have appropriate space and equipment.

The central administrators monitor the audit to ensure that the audit is conducted within the general means of accepted audit practice and to ensure that the audit is conducted within the originally-defined scope. The Senior Vice President for Research and/or the controller have the ultimate authority to approve the response to an audit on behalf of the University.

The Audit Process

The auditor will conduct an "Entrance Conference" with the principal investigator, business manager, and representatives from Sponsored Projects Services and the Financial Services Office. The purpose of the Entrance Conference is to define the scope of the audit and discuss the process for the audit.

The auditor will assess the competence and attitude of the University central administrators as well as the principal investigator and departmental business personnel. The auditor will also review our internal control system, i.e., policies and procedures, and monitoring mechanisms. Based on this assessment, the auditor will determine to what extent they can rely on the University systems and the relative risk associated with the audit. If the auditor feels that University systems are not reliable, more transactions will be selected for review and the scope of the audit may be expanded.

Auditors will discuss their findings with the central administrators. It is the responsibility of central administration to know the regulations and defend the University if we are operating within the rules and to concur with the findings if we are found to not have operated within the rules.

Depending on the type of audit, the University may or may not have the opportunity to respond to the findings and may or may not receive a copy of the final audit report.

Audit Tips

  • Central administration is responsible for collecting information and pulling records for the auditors.
  • Answer questions honestly, directly, and succinctly.
  • Refrain from providing unrequested information.
  • Do not tamper with or manufacture records. If you have no records, say so. Fabricating and/or altering records is fraud.
  • Be alert. Auditors may not know the regulations applicable to your project as well as you do.
  • Be courteous, cooperative, and professional when dealing with the auditors.