CSUN Taking Right Course to Collect From Debtors

No one disputes that mistakes were made--some big, some small. In the end, though, errors and oversights by former Cal State Northridge finance officials allowed more than $675,000 owed to the cash-strapped university to go uncollected, according to a state audit that reviewed records of the Northridge campus going back several years prior to 1995. Granted, the amount is less than one-half of 1% of the school’s annual budget, but questions about even that relatively small amount of money raise issues about the effectiveness of campus administrators at keeping track of public money. Yes, local officials must work under often Byzantine state procedures that govern day-to-day operations at all 22 Cal State campuses. As Art Elbert, CSUN’s vice president of administration and finance, pointed out Friday at a meeting with Times reporters and editors, the system can be a real mess--particularly at a campus like CSUN still trying to dig itself out of the chaos wrought by the Northridge earthquake, which threw record keeping into disarray.

Since the CSUN audit was completed last year, current administrators have, to their credit, taken aggressive steps to reduce the outstanding accounts. About 88% of the balances have been taken off the books through a combination of collection efforts and writing off some debts as uncollectable. Another $79,501 remains to be collected.

More than half the outstanding balances stemmed from payroll and salary advances. Something of a misnomer, “advances” most often were used to pay employees for work already performed and many employees who got them had no idea they owed the university a dime. Most of the rest was owed to university organizations by outside groups.

Although the university is moving in the right direction, much remains to be done systemwide to improve oversight and accountability. To that end, all Cal State campuses this year will undergo review by outside auditors, much like the scrutiny to which publicly traded companies submit their annual financial statements. At CSUN, this review begins this coming week. At the same time, CSUN administrators have taken steps to curtail delinquent accounts in the future. First, they appointed an interim controller, longtime accounting professor Robert Kiddoo. Second, they hired two people to reform payroll processes and are studying policies to ensure accounts don’t pile up. Third, the university is more aggressively pursuing outside debtors by itemizing bills and following up by phone. Finally, and perhaps most important, the university is taking steps to track information across departments such as payroll and purchasing.

That’s the right course. And not just for CSUN. Getting the most out of every penny sometimes means knowing where they all are.