Reports & Information

Electronic Reports

In accordance with the Texas Internal Auditing Act, we submit an annual report of TSTC's internal audit activity. The following reports were submitted for fiscal years 2003 through 2006.

• Fiscal Year 2006 Annual Report
• Fiscal Year 2005 Annual Report
• Fiscal Year 2004 Annual Report
• Fiscal Year 2003 Annual Report

Audit reports are submitted to the four TSTC Presidents, the Board of Regents, the Chancellor and the Executive Vice Chancellor for discussion and review at the quarterly Board of Regent meetings. After reports are sent to the Sunset Advisory Committee, the budget division of the governor's office, the state auditor, and the Legislative Budget Board, the individual reports are provided below and they open using Adobe Acrobat Reader.

• Audit Reports for FY 2005
• Audit Reports for FY 2004
• Audit Reports for FY 2003

Risk and Control Information

What do you think about when someone says risk? Risk management? Internal control? Governance? Assurance?

Historically, these terms have meant different things to different people. It is part of our mission to continuously raise awareness and understanding of these terms, suggest a common language, and provide clear direction and guidance related to these concepts.

The basis for our discussion of risk management and internal control is the guidance provided by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. COSO has published two studies that have established principles-based frameworks that provide standards against which institutions can assess and improve. COSO’s groundbreaking study Internal Control - Integrated Framework established a methodology for evaluating the effectiveness of internal controls and has been adopted by the global financial community, including regulatory bodies, the public accounting profession and internal auditing profession. Expanding on the original Internal Control framework, COSO published Enterprise Risk Management—Integrated Framework in September 2004.

In simple terms, the objective in Enterprise Risk Management, or ERM, is to help institutions get where they want to go while avoid pitfalls and surprises along the way.

The ERM framework. . .

. . .breaks entity objectives into four categories:

• Strategic
• Operations
• Reporting
• Compliance

. . .considers activities at all levels:

• Enterprise-level (System)
• Division or subsidiary (College)
• Business unit or process

. . .and includes eight interrelated components:

• Internal Environment
• Objective Setting
• Event Identification
• Risk Assessment
• Risk Response
• Control Activities
• Information and Communication
• Monitoring

We ultimately hope to help TSTC move toward a fuller risk management process. We plan to take a leading role in helping TSTC understand ERM, getting ERM on the agenda, and instill the concepts within TSTC’s culture.

Audits of Financial Statements and Compliance and Controls of Federal Awards

The Texas State Technical College System is audited as part of the Single Audit of the State of Texas. This audit complies with the requirements of OMB Circular A-133 "Audits of States, Local Governments, and Non-Profit Organizations." There is not a separate audit for the individual Texas State Technical Colleges or the Texas State Technical College System. Statewide Single Audit is an annual audit for the State of Texas. It is conducted so the State complies with the Single Audit Amendments of 1996 and Office of Management and Budget (OMB) Circular A-133.

Financial Portion - The State Auditor's Office performed the financial portion of the 2003 Statewide Single Audit. The financial portion includes an audit of the State's financial statement's and a review of significant financial and compliance controls. See SAO Report No. 04-555 and its findings, recommendations, and management responses.

Federal Portion - The State Auditor's Office contracted KPMG, LLP, to perform the federal portion of the 2004 Statewide Single Audit. The federal portion included a review of compliance and controls over the State's federal awards and an audit of the Schedule of Expenditures of Federal Awards. See SAO Report No. 05-319 for findings, recommendations, and management responses.

The Texas State Technical College System is included in the State of Texas 2004 Comprehensive Annual Financial Report for the Year Ended August 31, 2004. The report is available at http://www.window.state.tx.us/fm/pubs/cafr/.