PRINCE HALL
New Member
ASU's status in jeopardy
Montgomery university's financial reporting at center of dispute
08/01/02
By JEFF AMY
Staff Reporter
A dispute over Alabama State University's financial reporting could threaten the Montgomery school's accreditation within six months, a recent letter from the accrediting body warns.
Alabama State officials say the decision by the Southern Association of Colleges and Schools to downgrade the school's accreditation status in June was an unjust error.
"Clearly, we believe the committee reviewing Alabama State has erred," wrote Joe Lee, Alabama State's president, in a letter to SACS dated Monday.
Accreditation is key for colleges, because students attending non-accredited schools don't qualify for federal financial aid. Also, transferring credits earned at an unaccredited institution can be nearly impossible in many cases. Many colleges that lose accreditation collapse or struggle to survive.
SACS' Commission on Colleges put Alabama State on warning June 20, for failure to address previous accounting problems, and for failure to adopt a new format for financial reports. In a July 3 letter signed by James Rogers, the college group's executive director, the commission warns its seal of approval could be yanked from Alabama State in December, because of trouble the school had with SACS in 2001.
"Federal regulations and commission policy stipulate that if an institution is not in compliance with the criteria for accreditation within two years following the commission's initial action on the institution, the institution will be required to show good cause why it would not be removed from membership," wrote Rogers.
Jack Allen, SACS associate executive director, said colleges are rarely booted from SACS, though.
"We have very few institutions that are dropped from membership," he said.
Despite repeated requests over the course of the last week, neither Lee nor Freddie Gallot, Alabama State's vice president for fiscal affairs, would speak to the Mobile Register. Julie DeBardelaben, a spokeswoman for the school, said officials believed that documents provided to the Register spoke for themselves.
Lee has asked for a fresh look by SACS, but Allen said the 5,590-student school has no avenue to force reconsideration before December, when SACS' Commission on Colleges is next scheduled to meet.
"Our commission can't keep reconvening every month because some new materials have come in," Allen said.
SACS has three levels of sanctions for colleges that it judges do not meet its voluminous requirements. The first is a private sanction known as notice. Alabama State was sanctioned at the second level -- warning -- which is similar to notice, but is made public. The third level is probation, one stop short of having accreditation revoked.
Colleges that lose their accreditation can appeal, but several SACS officials said intermediate sanctions can't be fought, other than by sending in reports demanded by SACS.
"I would suspect the best way to appeal this process is to provide the information requested," said David Potts. Potts, president of Judson College in Marion, is the top Alabama member of the 77-person Commission on Colleges.
Alabama State was on warning during 2001 for its inability to provide a year-end audit to SACS in a timely manner. The school was removed from warning in December 2001, but had to provide follow-up reports. Another follow-up report will be due Nov. 15, to be considered at SACS' December meeting. At that meeting, Ala bama State could be cleared, downgraded to probation, or lose its accreditation.
Institutions have two years from when they are first cited to comply. At that time, they can be dropped from SACS membership, unless they show good cause as to why they should get more time to comply. If an extension is granted, a college goes onto probation and gets between six months and two years more. Most colleges eventually work out their difficulties.
At the same time that SACS placed Alabama State on warning last month, it denied the college's request to be allowed to grant a doctoral degree in Educational Leadership, Policy and Law. DeBardelaben said that the university will be unable to offer the program until gaining SACS approval, but that it wasn't scheduled to start until January anyway, so getting the blessing in December won't create delays.
Part of SACS' criticism focused on Alabama State's failure to adopt a new accounting standard, calling on all arms of government, including colleges, to present financial statements with a longer-term view. New statements must include all long-term debts and assets of a body, not just payments received or paid out in a particular year. It also will force government agencies, departments or educational institutions to note costs to maintain or replace big-ticket items like vehicles, computers and buildings.
Alabama State officials said it's unfair for SACS to cite them for not complying with the new standards, because they don't have to do so until Sept. 30, the end of the current fiscal year.
In its request for further review, the college included information from its auditors, the Birmingham accounting firm of Banks, Finley, White & Co., to document that Alabama State was working to adopt the new rules.
Tom Allen, chairman of the Connecticut-based Governmental Accounting Standards Board, which decreed the new rules, agreed that Alabama State hasn't missed its deadline.
"They are absolutely not late now," Allen said Friday.
SACS' Jack Allen said the group knows Alabama State hasn't missed its deadline, but wanted to encourage the university to push ahead on adoption.
Alabama State also got its accountants to provide an unusual midyear evaluation of its efforts to fix previous accounting problems. The SACS letter cited concerns over weak internal controls and other violations from last year's audit.
Montgomery university's financial reporting at center of dispute
08/01/02
By JEFF AMY
Staff Reporter
A dispute over Alabama State University's financial reporting could threaten the Montgomery school's accreditation within six months, a recent letter from the accrediting body warns.
Alabama State officials say the decision by the Southern Association of Colleges and Schools to downgrade the school's accreditation status in June was an unjust error.
"Clearly, we believe the committee reviewing Alabama State has erred," wrote Joe Lee, Alabama State's president, in a letter to SACS dated Monday.
Accreditation is key for colleges, because students attending non-accredited schools don't qualify for federal financial aid. Also, transferring credits earned at an unaccredited institution can be nearly impossible in many cases. Many colleges that lose accreditation collapse or struggle to survive.
SACS' Commission on Colleges put Alabama State on warning June 20, for failure to address previous accounting problems, and for failure to adopt a new format for financial reports. In a July 3 letter signed by James Rogers, the college group's executive director, the commission warns its seal of approval could be yanked from Alabama State in December, because of trouble the school had with SACS in 2001.
"Federal regulations and commission policy stipulate that if an institution is not in compliance with the criteria for accreditation within two years following the commission's initial action on the institution, the institution will be required to show good cause why it would not be removed from membership," wrote Rogers.
Jack Allen, SACS associate executive director, said colleges are rarely booted from SACS, though.
"We have very few institutions that are dropped from membership," he said.
Despite repeated requests over the course of the last week, neither Lee nor Freddie Gallot, Alabama State's vice president for fiscal affairs, would speak to the Mobile Register. Julie DeBardelaben, a spokeswoman for the school, said officials believed that documents provided to the Register spoke for themselves.
Lee has asked for a fresh look by SACS, but Allen said the 5,590-student school has no avenue to force reconsideration before December, when SACS' Commission on Colleges is next scheduled to meet.
"Our commission can't keep reconvening every month because some new materials have come in," Allen said.
SACS has three levels of sanctions for colleges that it judges do not meet its voluminous requirements. The first is a private sanction known as notice. Alabama State was sanctioned at the second level -- warning -- which is similar to notice, but is made public. The third level is probation, one stop short of having accreditation revoked.
Colleges that lose their accreditation can appeal, but several SACS officials said intermediate sanctions can't be fought, other than by sending in reports demanded by SACS.
"I would suspect the best way to appeal this process is to provide the information requested," said David Potts. Potts, president of Judson College in Marion, is the top Alabama member of the 77-person Commission on Colleges.
Alabama State was on warning during 2001 for its inability to provide a year-end audit to SACS in a timely manner. The school was removed from warning in December 2001, but had to provide follow-up reports. Another follow-up report will be due Nov. 15, to be considered at SACS' December meeting. At that meeting, Ala bama State could be cleared, downgraded to probation, or lose its accreditation.
Institutions have two years from when they are first cited to comply. At that time, they can be dropped from SACS membership, unless they show good cause as to why they should get more time to comply. If an extension is granted, a college goes onto probation and gets between six months and two years more. Most colleges eventually work out their difficulties.
At the same time that SACS placed Alabama State on warning last month, it denied the college's request to be allowed to grant a doctoral degree in Educational Leadership, Policy and Law. DeBardelaben said that the university will be unable to offer the program until gaining SACS approval, but that it wasn't scheduled to start until January anyway, so getting the blessing in December won't create delays.
Part of SACS' criticism focused on Alabama State's failure to adopt a new accounting standard, calling on all arms of government, including colleges, to present financial statements with a longer-term view. New statements must include all long-term debts and assets of a body, not just payments received or paid out in a particular year. It also will force government agencies, departments or educational institutions to note costs to maintain or replace big-ticket items like vehicles, computers and buildings.
Alabama State officials said it's unfair for SACS to cite them for not complying with the new standards, because they don't have to do so until Sept. 30, the end of the current fiscal year.
In its request for further review, the college included information from its auditors, the Birmingham accounting firm of Banks, Finley, White & Co., to document that Alabama State was working to adopt the new rules.
Tom Allen, chairman of the Connecticut-based Governmental Accounting Standards Board, which decreed the new rules, agreed that Alabama State hasn't missed its deadline.
"They are absolutely not late now," Allen said Friday.
SACS' Jack Allen said the group knows Alabama State hasn't missed its deadline, but wanted to encourage the university to push ahead on adoption.
Alabama State also got its accountants to provide an unusual midyear evaluation of its efforts to fix previous accounting problems. The SACS letter cited concerns over weak internal controls and other violations from last year's audit.
