(The Center Square) – Warning of degradation of financial integrity with a second consecutive poor audit in three years, this one with more than $15 million in misstatements, Durham Technical Community College is engaged with the North Carolina auditor for resolutions.
“Unfortunately,” first-term Republican state Auditor Dave Boliek wrote in his office’s findings, “previous recommendations from the Office of the State Auditor were not fully implemented. As a result, for the second audit in a row, the team has identified millions of dollars of misstatements.
“Fixing these issues must be top of mind for the college as degradation of financial integrity can negatively impact students and faculty.”
In his response, college President J.B. Buxton said Durham Tech after a fiscal year 2023 audit implemented “significant measures to strengthen internal controls and financial operations.” These, he wrote, were in accord with the auditor’s office. An April 2024 writing from Buxton and Chief Financial Officer Andrew Kleitsch to former first-term Democratic state Auditor Jessica Holmes also acknowledged a finding of “inadequate internal controls resulted in significant misstatements.”
That audit, for the fiscal year 2023, had more than $9.5 million in misstatements.
Buxton, writing to Boliek, said more than 50% of Finance Department staff had turned over since the audit by Holmes’ staff, including the CFO.
Durham Tech serves more than 18,000 students on seven campuses in Durham and Orange counties, with pursuit available for more than 90 associate degree and certificates. Accreditation is from the Southern Association of Colleges and Schools Commission on Colleges. Buxton, appointed by then-Gov. Roy Cooper, has led the institution since June 2020.
Misstatements in the audit included the beginning net position because of:
• $3.1 million, related to depreciable assets. Disposal of two buildings wasn’t recorded the prior year.
• $1.1 million, related to construction in progress. Mistakes were made in expense and capitalization.
Additional misstatements included:
• $2 million, county capital aid understatement.
• $1.7 million, right-to-use leased assets, lease liabilities and related accounts.
• $1.6 million, restricted net position expendable for capital projects.
• $971,000, restricted and unrestricted cash.
• $505,000, interest and fees on lease/subscription liabilities.
The findings said misstatements were also on the incomplete statement of cash flows. Additional audit adjustments were required to correct misstatements in financial statements, notes to financial statements and required supplementary information.
