University of Arkansas audit finds larger deficits

University of Arkansas audit finds larger deficits

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At the University of Arkansas, a group of legislators conducted an audit on the university’s budgets and found large cash deficits. In 2011, the institution overspent $2.14 million while in 2012, spending increased to $4.19 million, according to the Arkansas Traveler. University of Arkansas Chancellor David Gearhart reported a $3 million loss in 2012.

“The audit report released today by the Division of Legislative Audit regarding the advancement division of the University of Arkansas confirms the issues that contributed to the overspending in the [advancement] division,” University of Arkansas President Donald Bobbitt explained. “While the expenditures were for legitimate needs leading up to a major fundraising campaign and the auditors found no theft or fraud, it’s clear that there was a lack of budget oversight within the advancement division.”

Spending increased from $7.94 million to $13.23 million—despite the fact that incoming revenue stayed about the same. Due to lack of oversight, some employees within the Division of Advancement were fired, including former spokesman John Diamond.

About three days after the University of Arkansas audit was released, Diamond publicly stated that the team “could not do its work as well as it needed to” because “some workers were told to delete some of its financial records in advance, according to the Arkansas Times. If this is true, those who committed this felony can face up to six years in jail.

This is not the first time the institution was questioned about its spending. In February, the Arkansas Democrat-Gazette filed a Freedom of Information Act request to see the school’s financial records, but the advancement department never responded—the local newspaper filed a lawsuit against Diamond and Gearhart. If this is also fact, those who violate this misdemeanor will be in prison for 30 days.

Based on Diamond’s testimony, the committee’s lead auditor Representative Kim Hammer motioned to reopen their investigation—it was a unanimous decision, Arkansas Business explained.

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