THE UNIVERSITY OF IOWA FINANCIAL SUBCERTIFICATION WORKSHOP SESSION

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THE UNIVERSITY OF IOWAFINANCIAL
SUB-CERTIFICATION WORKSHOP SESSION 1 Ethics
Human Resources

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Todays Presenters

• Kevin Ward
• Exec. Associate Director, HR (Employee Labor
  Relations)
• Terri Hein
• Assistant Director, HR (Payroll)
• Selina Martin
• Associate Controller (Business Office)

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Todays Agenda

• Financial Sub-certification Website
• http//www.uiowa.edu/budgetofficers/subcertificati
  on/subcertification/index.html
• Objective of todays training
• Review questions 1 2
• Review the underlying policies processes
• Identify related control document which indicate
  compliance with policies
• Identify the resources available to learn more
• Understand risks consequences of non-compliance
• What should you do after this workshop?

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Sub-certification Question.

• Does the college/unit communicate with faculty
  and staff with fiscal responsibilities about the
  importance of understanding and observing the
  University of Iowa Ethics Policy?

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Relevant Ethical Issues

• Appropriate use of financial or other resources
• Financial reporting and accountabilities
• Ethical practices and compliance
• Conflicts of interest and commitment
• Proper employment and pay practices

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Related Policies

• Board of Regents Code of Business and Fiduciary
  Conduct
• http//www2.state.ia.us/regents/Policies/Chapter2
  07/chapter7.02.htm
• UI Policy on Ethics Responsibilities
• http//www.uiowa.edu/our/opmanual/iii/16.htm
• Conflict of Commitment Interest Policy
• http//www.uiowa.edu/our/opmanual/ii/18.htm
• Conflict of Interest in Employment (Nepotism)
  http//www.uiowa.edu/our/opmanual/iii/08.htm

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Code of Business Fiduciary Conduct

• http//www2.state.ia.us/regents/Policies/Chapter2
  07/chapter7.02.htm
• http//www.uiowa.edu/president/ethics-conduct/hand
  book.htm
• Addresses appropriate use of financial resources,
  financial reporting, ethical practices and
  compliance.
• All employees play a role in ensuring University
  resources are protected, preserved and enhanced
• All business and fiduciary conduct should be
  based upon principles of fairness, integrity,
  respect, accountability, and compliance with law,
  to support the objectives, goals and mission of
  the institutions

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Code of Business Fiduciary Conduct

• Specifically prohibits actions that may make
  financial statements materially misleading, or
  that interfere with audit activities

• Sets forth additional responsibilities for senior
  management positions related to leadership and
  compliance with this code

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Policy on Ethics Responsibilities

• http//www.uiowa.edu/our/opmanual/iii/16.htm
• University policy that establishes expectations
  for ethical practices and compliance with other
  university policies.
• Specifically, staff will adhere to ethical
  standards of conduct, and act consistent with the
  Universitys mission and values, recognizing our
  accountability to the State of Iowa

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Policy on Ethics and Responsibilities

• The interactions and work product of each staff
  member should reflect our accountabilities for
• Professional Conduct
• Fairness
• Civility
• Compliance
• Information Data Management
• Stewardship

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Policy on Ethics and Responsibilities

• Employing units may establish more specific
  expectations
• Violations of policy should be investigated and
  addressed promptly

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Policy on Ethics and Responsibilities

• By reference incorporates all other University
  policies and work expectations
• In relation to sub-certification, do you and your
  employees understand and observe University
  policies?

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Conflict of Commitment Interest

• http//www.uiowa.edu/our/opmanual/ii/18.htm
• Conflicts may be related to a personal financial
  interests or the commitment of time in relation
  to University interests or University employment
• The purpose of the policy is to protect the
  objectivity of employees, conflicts of interest
  are to be either avoided, or disclosed and
  managed

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Conflict of Commitment

• Conflict of commitment involves a situation in
  which an employee engages in an outside activity
  that interferes, or appears to interfere, with
  fulfillment of the employee's obligations to the
  University, even if the outside activity is
  valuable to the University or contributes to the
  employee's professional development and
  competence.

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Conflict of Interest

• Conflict of interest involves a situation in
  which faculty, staff, or student employees have
  significant financial or other personal
  considerations that may compromise, or have the
  appearance of compromising, their professional
  judgment or integrity in teaching, conducting or
  reporting research, or performing other
  University obligations.

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Conflict of Commitment Interest

• Tiered approach
• Certain activities are prohibited
• Others require disclosure and management
• Conflict of interest management plan approved
  prior to initiating the activity
• Forms and templates are available through web
  links within the policy
• If there is any uncertainty, employees should
  consult their supervisor.

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Conflict of Interest in Employment

• http//www.uiowa.edu/our/opmanual/iii/08.htm
• A conflict of interest in employment at may arise
  when
• an individual employee has the responsibility to
  make, or participate actively in making,
  decisions or recommendations relating to the
  employment status of another individual
  University of Iowa employee or
• there is a direct reporting line between two such
  individuals.

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Conflict of Interest in Employment

• a conflict of interest in employment arises
  whenever the two such individuals have a current
  or former relationship occurring outside the work
  setting that would make it difficult for the
  individual with the decision-making
  responsibility to be objective (in reality or
  appearance).

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Conflict of Interest in Employment

• Assures objective, fair and equitable treatment
  of employees
• Conflicts of interest in employment (nepotism)
  should be avoided whenever possible, and
  otherwise disclosed and managed

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Conflict of Interest in Employment

• A management plan must be developed by first
  neutral supervisor or above. Plan templates are
  available.
• The management plan must be
• reviewed and approved by the University
  Committee on Conflict of Interest in Employment.
• Policy applies to all employees regular,
  temporary, students, staff and faculty.

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Other Related Policies

• We must also comply with related policies
• http//www.uiowa.edu/our/opmanual/ii/01.htm
• Operations Manual Part II Division 1
• Human Rights, Affirmative Action, and Equal
  Employment Opportunity

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Control Documents

• Records which indicate compliance
• New employee orientation
• Training Records
• Departmental meetings
• Periodic communication
• Individual performance reviews
• Disclosure of an Outside Activity form
• Conflict of Interest Management Plan
• Start-Up Company Conflict of Interest
  Issues/Policies form
• Financial Interest in Research Disclosure Form

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To learn more

• Ethics and Conduct website http//www.uiowa.edu/p
  resident/ethics-conduct/index.htm
• Resource Guide
• http//www.uiowa.edu/president/ethics-conduct/ha
  ndbook.htm
• Ethics course through ICON
• http//icon.uiowa.edu/
• EthicsPoint reporting system https//secure.ethics
  point.com/domain/en/report_custom.asp?clientid972
  3

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Sub-certification Question.

• Does the college/unit follow personnel and
  payroll policies as set forth by Human Resources?

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Payroll Related Policies

• General Compensation http//www.uiowa.edu/our/opm
  anual/iii/17.htm
• Extra Compensation
• http//www.uiowa.edu/our/opmanual/iii/17.htm1716
  
• Supplemental Activities
• http//www.uiowa.edu/7Eour/opmanual/iii/17.htm17
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• Leaves of Absence
• http//www.uiowa.edu/our/opmanual/iii/21.htm

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Personnel and Payroll Policy

• http//www.uiowa.edu/our/opmanual/iii/17.htm

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Expenditure Budget
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Payroll Benefits

• 51 of our budget is salary fringe benefits!
• Annual salaries gt 1 billion!
• We must ensure that we are paying our employees
  equitably and within the laws regulations of
  our policies and procedures.

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General Compensation

• Position classification
• Salary rate setting
• Bargaining versus non-bargaining
• Compliance with FLSA state minimum wage
• General salary transactions are audited
• Summer session payments

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Extra Compensation

• Must apply and obtain approval from the
• head of the faculty or staff member's major
• functional unit.
• All requests for extra compensation are to be
  made in advance of the work to be accomplished
  and should include a statement of justification.
• Applies to all situations regardless of whether
  the work for which extra compensation is being
  claimed is accomplished during regular working
  hours, off-duty hours, leave without pay, or
  vacation periods.

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Extra Compensation

• Requests for extra compensation that exceed
  certain amounts requires specific approval by the
  appropriate department, Dean, or VP, and
  Executive VP/Provost or Associate VP/Director of
  Human Resources.
• PS 3,000 single payment, 5,000 cumulative FY
• Faculty 3,000 single payment, 8,000 cumulative
  FY

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Supplemental Activities

• Royalties from Course Materials
• Employment on Grants and Contracts Administered
  by the University
• Extension Activities

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Leaves of Absence

• http//www.uiowa.edu/our/opmanual/iii/21.htm

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Leaves of Absence - General

• Applies in most cases to leaves of
• absence without pay
• University does not have the authority to pay any
  person except for services rendered
• Requests for leaves of absence should be
  authorized by the supervisor or designated
  department administrator and Human Resources (HR)
  Unit Representative in advance of the intended
  leave.

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To learn more

• Strategic Human Resources Series
• http//www.uiowa.edu/fusstfdv/series/hrfund.htms
  trategic
• Human Resource Fundamentals Series
• http//www.uiowa.edu/fusstfdv/series/hrfund.htm
• Overview of HR Reports, Query Tools Data
  (course)
• http//www.uiowa.edu/7Efusstfdv/catalog/workplace
  /336.html
• Electronic Workflow and HR Transactions Reports
  (course)
• http//www.uiowa.edu/7Efusstfdv/catalog/workplace
  /117.html
• Workflow Basics (ICON course)
• http//icon.uiowa.edu/
• Human Resources Policies Guidelines (website)
• http//www.uiowa.edu/hr/administration/policies_a_
  z.html

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Personnel Payroll - Control Documents

• Documents within transaction system

• Summer Support Form
• Summer Session Form
• Position Change Form
• Special Compensation Payment
• Special Compensation Prior Approval

• Appointment Form
• Change in Status
• Termination Form
• Transfer Form
• Adjunct Support Form

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Personnel Payroll - Control Documents
Documents outside of transaction system

• Employee Time Records
• Online Absence Report
• Workers Comp-First Report of Injury
• Tuition Assistance Application
• W-2 Form
• 1042s Form

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Transaction System Workflow

• What does it mean when you approve a transaction
  in Workflow?
• Different signature requirements/roles
• Cross college implications
• Late Transactions
• Security/Overpayments/Access to information

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Security, Reports, Applications

• Security Administrators
• Workflow
• Other applications
• Reports Queries
• Applications

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Salary Wage Overpayments
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Number of Late Transactions

• Terminations
• Leaves of Absence

• Change in Status
• Other

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Financial Sub-certification Focus

• Our internal controls should reasonably assure.
• Compliance with laws, regulations contracts
• Prevention detection of fraud
• Proper recording of transactions and proper
  classification valuation of assets
  liabilities
• Adequate records, supporting documentation and
  proper disclosure

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Risks Consequences

• Misuse of university resources
• Fraud
• Audit findings resulting audit opinion
• Legal liability
• Public disclosure
• Lower bond rating
• Inability to retain excellent staff/faculty
• Lower student enrollment
• Negative impact on reputation

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Remember.

• Financial sub-certifications will be completed in
  fall 2009 for the fiscal year 2009.
• Accurate responses will help us to help you to
  strengthen internal controls.
• Progress will be made over time as we identify
  areas of opportunities to improve controls.

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What are your next steps?

• Understand your role in the sub-certification
  process
• Understand the general specific policies
  relevant to your roles responsibilities
• Share information with your staff colleagues
• Attend targeted training
• Review control documents checklist
• Provide feedback to central administration

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• Thank you!