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An Audit Report on Student Fees at Selected Higher Education Institutions

September 2008

Report Number 09-002

Overall Conclusion

The five higher education institutions audited spent and transferred funds collected from 30 of 40 student fees tested in accordance with applicable laws and policies. However, improvements should be made to ensure that all student fee revenues are spent and transferred appropriately. The higher education institutions audited included:

- Texas Tech University.

- Sam Houston State University.

- The University of Houston.

- The University of Texas at San Antonio.

- The University of North Texas.

Higher education institutions should improve monitoring of student fee account balances. At the end of fiscal year 2007, there were accumulated balances in incidental student fee accounts at all higher education institutions audited.

Higher education institutions could interpret student fee requirements more consistently if the Texas Education Code and internal policies were more specific. A lack of specificity in the Texas Education Code and internal policies at higher education institutions prevented auditors from determining whether certain student fees were collected, transferred, and spent in accordance with applicable laws and policies. The lack of specificity also led to inconsistent classification of student fee revenue among the five institutions audited.

Higher education institutions should account for student fee revenue in a manner that allows them to ensure they collect and spend funds in accordance with applicable laws and policies. Higher education institutions receive funds from sources other than student fee revenue and they often deposit these funds in the same accounts as student fee revenue. This commingling of funds prevented auditors from determining whether higher education institutions spent student fee revenue in accordance with applicable laws and policies.

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