Auditors find reporting, monitoring and reconciliation problems across North Dakota University System
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Summary
State auditors issued a clean opinion on the University System's consolidated financials but reported four formal findings affecting multiple campuses, including misreporting of strategic investment funds, insufficient monitoring of service organizations, recurring bank-reconciliation errors, and bond-proceeds accounting errors at Bismarck State College.
State auditors told the Legislative Audit and Fiscal Review Committee that while the North Dakota University System's consolidated financial statements received an unmodified (clean) audit opinion for the year ended June 30, 2025, auditors identified four formal findings that affect multiple campuses.
Dan Cox, director of audit services for the State Auditor's Office, said the first finding concerned material audit adjustments at several campuses related to Strategic Investment Fund (SIF) transfers that should have been reported as revenue in the year received. "These adjusted, these adjustments related to the funding in the 2023-25 biennium from the North Dakota strategic investment and improvements fund," Cox said, listing affected campuses including Dickinson, Mayville, Minot, NDSU, UND and others.
The audit also found insufficient monitoring of external service organizations used by campuses' PeopleSoft systems. Cox said seven service organizations were significant to core technology services and six lacked adequate monitoring; the transactions affected about $585,000,000 in activity. "Due to not obtaining and utilizing that report and monitoring for those controls, the risk that was passed on to the service organization has increased," he said.
A third finding cited repeated problems with bank reconciliations at Dakota College at Bottineau, Dickinson State and Williston State, where reconciliations were incomplete or not cleared to a $0 difference. The fourth finding covered Bismarck State College's treatment of unspent bond proceeds invested in CDs; auditors concluded some proceeds were not properly recorded as restricted cash, producing a negative construction-fund balance that required an audit adjustment (auditors said no cash was missing).
Robin Putnam, director of financial reporting for the University System, said the system agreed with the findings and has begun work to strengthen reconciliations and shared-service support to affected campuses. Putnam told the committee that the system is expanding monitoring and has appointed internal resources to follow up.
Committee members pressed campus officials on specific practices. Karen Higstow of NDSU explained that campuses sometimes use Bank of North Dakota CDs to earn interest while funds are being held for planned projects; she described typical CD maturities as six months to three years.
Auditors and system officials said the findings will be followed up in subsequent audits and through shared services and corrective-action plans. The committee did not take a formal vote; auditors said they would monitor implementation in future audits.