Chief Business Officers Speak Out
Although the National Association of College and University Business Officers has existed since 1962, the job title of “chief business officer” still isn’t widely used. The people who would fall into this category, however, oversee a variety of functions on campus, ranging from finances to the bookstore and everything in between. As a new semester was set to begin, four business officers talked to University Business about topics such as how they ensure accounting practices are above board and how their offices help keep their schools running smoothly.
Deborah Adishian-Astone, associate vice president, Auxiliary Operations and Enterprise Development, California State University, Fresno. She received the NACUBO Rising Star Award in 2008.
Morgan Olsen, former NACUBO board chair and executive vice president and treasurer, Purdue University (Ind.). This month he starts a new position: executive vice president and treasurer at Arizona State University.
Reagan Romali, chief business officer, El Camino Community College/Compton Center (Calif.). Romali formerly held executive-level business department positions at Los Angeles City College and at Santa Monica College.
Stephen Taksar, vice president for finance and administration, Plymouth State University (N.H.). He is the former vice chancellor for administration and finance at Indiana University Southeast.
MORGAN OLSEN: We’ve done quite a bit to implement those components that the administration and board feel are appropriate. Legally it doesn’t apply, but there are good management practices that can be implemented. We’ve relied on a good analysis from NACUBO outlining how the experts felt it fit for higher education. Duties of the audit committee and their relationship with the board and external auditors?many of those things have been guided by the act.
REAGAN ROMALI: We will be implementing them at the end of this fiscal year. It is good business practice. Since we are paid for by public tax dollars, we really feel we have to be responsive to the taxpayers, spend their money wisely, and be transparent.
DEBORAH ADISHIAN-ASTONE: We have separate audit committees for all of our auxiliary corporations that have revenues in excess of $2 million per year. We work very closely with each audit committee on policies, procedures, and detailed review of annual reports. Also, we try to clarify complex transactions or major changes with detailed footnotes in the financial statements.
STEPHEN TAKSAR: As part of the University System of New Hampshire, we are guided by the USNH Business Officer’s Code of Ethics. The Board of Trustees’ Audit Committee oversees the system’s Internal Audit Department, which has a charter identifying its responsibilities. It performs financial and operational compliance reviews of departments, units, and processes throughout the system and individual campuses. Providing education on internal controls, assisting the external auditors, and providing individual assistance to departments, campuses, and units as requested are other duties the committee performs.
ROMALI: Accounting transparency is really critical in California community colleges to establish credibility. As we go about completing our mission [of reestablishing independent accreditation], people will believe our numbers and our finances. We do ground-up budgeting, we involve all constituencies in the process?everyone gets to discuss their programmatic and institutional needs. They have to take off their departmental hats and put on their institutional hats. We are in the process of creating monthly reports that show things like yearly projections, three-year projections, budget to actual, and who is over or under spending.
ASTONE: [Our efforts include] full disclosure on operational challenges that affect financial performance, [providing the] opportunity for audit committees to meet with external auditors without management present, and quarterly review of management letter findings and status of recommendations.
TAKSAR: Last year PSU established the Planning Budgeting Leadership Group, with the purpose of establishing a participatory budget process, and to bring an understanding of the process to the community. Transparency is also fostered by publishing an annual budget report, the operating budget, and personnel budgets on the university website. The President’s Cabinet presents forecasts to the PBLG in October and February.
OLSEN: One of the bigger transparency issues is with our stakeholders for cost and pricing. We’re trying to make sure people understand the difference in the cost to provide the education and the price. We are trying to provide additional aid for some students. Those are some of the biggest transparency issues we are spending time on.
ROMALI: Silos are, unfortunately, fairly typical. Administrative, academic affairs, student services, all have their own silos. We have a philosophy that administrative services are a booster seat to support the academic and student services side of the house. We look for ways to integrate student services into the other side of the house. For example, at a previous institution we established a security patrol and gave law or justice students a chance to shadow the [security officers] on campus. No matter what your role in the organization is, you are responsible for student learning.
OLSEN: The process of developing a strategic plan and implementing it helps a lot. You figure out how everyone’s roles contribute. You can also do a lot by making sure you understand each other’s challenges and opportunities. Having those discussions in various forums is good. Leaders should facilitate and make sure that happens. People in higher education are good at collaboration; they seek each other out and find out how they can work together.
ASTONE: [We break down silos] by bringing the stakeholders together to identify challenges and the different positions or concerns. We talk through the impacts to each area, allowing for thoughtful and candid discussion. I firmly believe in allowing my direct reports to work through issues without my involvement, but if that is not successful, then I do try to bring the areas together to solve the problem or address the areas needing improvement so that our total organization has a consolidated approach.
TAKSAR: Transparency and communication are values that are embedded in many planning processes, which facilitate departmental collaboration. Open communication allows for the most efficient and effective use of the university’s resources.
OLSEN: I try not to use the word “camps” or terminology to suggest there is a division. We have different goals, but we’re there for the same reason. Reasonable people sometimes differ on their approach to a challenge. The more you understand each other’s challenges, the more you can do to help another area. We make efforts in my area to facilitate and understand what is going on with the folks at the core of the mission.
ROMALI: This is a biggy. You need to help them understand you are there to support their success. I need to do everything I can do to help them teach better?things as simple as making sure the classroom is clean, do they have the technology and equipment they need. If they see I’m doing everything I can to support their teaching, that goes a long way toward establishing trust. As the head of finance, I look at the world of opportunity rather than the world of scarcity. I’m always looking for creative revenue generation to support them?grants, advertising opportunities. When the faculty see you are doing everything you can to bring them the best learning environment, it goes a long way to establishing trust.
TAKSAR: Communication helps here as well. When key stakeholders?students, faculty, and staff?can see the institution as a whole rather than the individual parts, there is a clearer understanding of the challenging, and sometimes difficult, strategic and financial decisions that are made to keep us vibrant and moving forward.
TAKSAR: Higher education has seen the change in the high school age population coming for some time and so has had the opportunity to prepare for the changing recruitment landscape. We are working to expand our reach for traditional undergraduate students. Additionally we are working to offer programs that appeal to nontraditional undergraduate students through the Frost School for Continuing and Professional Studies and aggressively working to attract professionals to the College of Graduate Studies. Also, we’re creating new degree programs designed to meet changing market demands.
ROMALI: We are blessed to have a mix of both traditional and older returning students in our population.
OLSEN: That is something that is important to our prospective students and the people helping them pay. We are always looking for ways to do things more cost-effectively; we’ve done a lot with joint purchasing opportunities. We have the opportunity through the Big 10 CIC consortium to leverage our “spend.” We always look for ways to leverage technology; we certainly have made investments. For example, we’ve just completed implementation of our OnePurdue Project [a new ERP system]. Once that is fully dialed in, it will pay off in benefits of letting people do things themselves.
TAKSAR: PSU has demonstrated excellent fiscal responsibility and implemented a number of cost-containment strategies including conserving energy and water, outsourcing the bookstore and dining services, and participation in group purchasing whenever possible. We strive for efficient structuring of debt, strong cash management, process improvements, and contract bidding. We have also aggressively sought out and pursued a variety of revenue-generating opportunities through increased fundraising efforts, managing undergraduate enrollment numbers, working to increase graduate student enrollment, hosting more conferences and events to capitalize on the university’s facilities in the summer months, and increasing sponsored-research programs.
ROMALI: Tuition is set by the state of California for California community colleges. We don’t have direct control. But we do a noble effort of lobbying the state to keep tuition down. It’s very important for students to have access; if they can’t afford to come to school, they miss out.
OLSEN: We understand that they’re students first. We try to understand challenges they’re facing, but at the end of the day we have a responsibility to all students. We have to balance the considerations. We take appropriate steps, but not before working with a student.
TAKSAR: Active students receive a general e-mail notification telling them the nature of the tuition bill balance. If not paid by the due date, a late fee is charged and a hold is placed on the account, which prevents the student from making any current registration changes, viewing grades online, and pre-registering for future terms. For recently withdrawn students, a paper bill is sent to the student’s home address allowing for two weeks to pay the bill or make payment arrangements with the university. If there is no response after the two-week period, the account is turned over to our collection manager.
ROMALI: In California, we have the Chancellor’s Office Tax Offset Program (COTOP). We send delinquent accounts to the state, and the funds are taken from the responsible person’s state tax refund. We also have a large financial aid population, so we don’t have the collection problems that other institutions do.
ROMALI: Actually, the weak economy is a tremendous opportunity for community colleges. It is a chance to retrain people who are out of work and to enhance skills they have to make them more competitive. It also gives us an opportunity to teach skills for a new career path and give people who are out of work a new direction.
OLSEN: The economy has been affected by credit liquidity, and the decline in housing is a one-two punch with the rising cost of commodities. ? We need to be responsive to that. Because we think there might be students who will have trouble covering the costs, we are making student aid a priority. We are kicking off the $300 million “Access and Success” fundraising campaign for private funds to provide aid. [It] will help us create classes that have the academic credentials and the social diversity people need.
ASTONE: Given that we are a four-year public institution, we are being faced with less support from the state, which is then putting more financial pressure on our students to pay higher tuition.
TAKSAR: The state of the economy can affect us in a variety of ways, like student enrollment (particularly nonresidents), increased challenges in fundraising, and potential investment losses due to market conditions. From a student perspective it may be more difficult to obtain loans. The university has been actively working with local banks and lenders to backfill the loan process for students.
ROMALI: That is such a critical need. We do have various programs; they are categorically funded programs. They teach these life skills and are noncredit.
TAKSAR: In spring 2008 the campus developed a new initiative called $MART (Students Monetary Awareness & Responsibility Today). The financial aid team created a number of activities to help students become more aware of issues related to financial literacy. Evening programs were held in all student residence halls. Student lender and New Hampshire Consumer Credit Counseling representatives came to share their advice on topics related to credit cards, FICO scores, minimizing student loan debt, budgeting, and other related financial information.
Students were invited to attend one-on-one counseling sessions with a financial aid counselor, who provided a personalized portfolio with information on their student loans. The portfolio included amortization schedules, credit counseling information, budget guides, financial aid history, and a CD produced and donated by New Hampshire financial author and speaker Peter Bielagus and California-based Freeway Guides. The financial aid team joined with the Wellness Center to provide monthly tips relating to overall physical, mental, and financial wellness issues. Presentations are also conducted in academic classrooms (upon request) to share financial literacy information.