Minnesota State audit office seeks three-year extension of CliftonLarsonAllen contract; audit committee approves charters and 2026 audit plan

The Audit Committee of the Minnesota State Colleges and Universities Board of Trustees discussed extending the system’s external-auditor contract with CliftonLarsonAllen (CLA) and approved updates to the committee and internal audit charters and the fiscal year 2026 audit plan.

Chief Audit Officer Amy Jorgensen told trustees CLA performs the system’s financial statement audits and federal single-audit work, including audits of financial aid. “Their current contract is executed on 04/20/2023 and remains in effect until 06/30/2026,” Jorgensen said. She asked the committee for guidance on extending the CLA contract through 06/30/2029, noting that without an extension the system would need to start a competitive RFP as early as the summer (Amy Jorgensen, chief audit officer).

Why it matters: trustees and staff said having an external auditor is mandatory for statutory compliance and that an extension would lock in a price and provide transition certainty. Jorgensen and committee members also warned that the audit office is already stretched and that choices about audit staffing and contractor hours affect how much internal follow-up and investigations the office can do.

Committee action and approvals: trustees voted to approve an updated audit committee charter and an updated internal audit charter by voice vote. The committee also approved the fiscal year 2026 internal audit plan by voice vote after staff described priorities.

What the audit office reported: Jorgensen reviewed top priorities in the FY2026 plan, including enterprise risk management work, next‑generation (NextGen) project risk reviews, NIST cybersecurity assessments and penetration testing, a purchase‑card audit, cybersecurity incident response reviews, third‑party technology vendor management and a financial‑aid review. She said the office plans flexibility in the audit plan because emerging risks or enterprise‑risk work may change priorities.

Investigations and follow‑up: internal audit reported a busy year of investigations and follow‑up work. The office said it received 34 new allegations in the year, completed 20 investigations (15 from the current year and five carried from prior years), confirmed 11 allegations, has eight investigations pending, and reported six matters handled at the campus level. Follow‑up from completed investigations led to 18 employment actions including terminations, resignations or discipline. The office noted that investigation timeliness is a common complaint and that the office is underresourced relative to peers (internal audit annual report).

Foundations and conflict risks: internal audit flagged a trend of problems involving campus foundations, where accounting controls and separation of duties sometimes were weak. Because foundations are separate 501(c)(3) entities, internal audit does not audit foundation records directly, but it will investigate actions of campus employees who carry out foundation accounting. Trustees and staff discussed reputational and legal risks when foundations misuse funds or lack adequate audits.

Payroll and Workday follow‑up: Eric Davis, vice chancellor for HR/finance operations, briefed trustees on progress addressing payroll issues identified in the prior payroll audit and Workday transition. He said teams have implemented job aids, improved integrations and restored HR service‑center capabilities, and that a faculty‑pay details report is now in production in a soft launch. He acknowledged ongoing integration work and said the fall term will be the real test for payroll stability.

Contract‑training and partnership work: staff reported on system efforts to improve contract training. Shannon Bryant described a cohort of nine colleges and one university that joined the national LEARN association to adopt best practices; several campuses are already using a shared business‑plan template and submitting plans for FY26.

Enrollment analytics pilot: Allie Pickens‑Opoku, system director for strategic enrollment, described a beta enrollment‑projection dashboard developed with a vendor (Quantixteen) using Lumina Foundation grant funds. The dashboard will provide campus‑level projections by program, major and ZIP‑area labor market integration; staff plan a formal presentation when beta testing finishes.

Discussion and resource concerns: trustees pressed audit leadership on resourcing. Jorgensen said internal audit staffing and contractor budgets are constrained; Baker Tilly (contract audit/advisory) has been billed at a fixed amount for years and rising contractor fees will reduce hours if the system cannot increase the contract. Jorgensen warned that the office’s professional credentials (CPAs, CIAs) and training are important and at risk if budgets are cut.

Next steps: staff will continue discussions with CLA on extension pricing and bring a formal CLA contract extension request to the Finance/Technology committee in June for committee and then board approval (staff presentation).

Ending: trustees emphasized the need for audit follow‑up reporting to the board, including more detailed aging and status of high‑risk findings and information on where investigative and audit recommendations remain open.