Education

Essex County College reports favorable financial audit as major milestone

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Essex County College is reporting a favorable annual financial audit and says the report is a step in the right direction to remove itself from probation instituted by the Middle States Commission. Credits: Wikipedia
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Newark, NJ – Essex County College is reporting a clean bill of health on its annual financial audit.

The audit, completed last month by certified public accounting and auditing firm PKF O’Connor Davies, found no material weaknesses in the college’s internal controls and found ECC to be in compliance with all federal and state sponsored programs. In addition, the college says that all material weaknesses found in the 2016 audit have been corrected.

Although the audit does not affect accreditation, the college hopes that the clean audit finding will contribute to demonstrating compliance with accreditation, according to a college spokesperson.

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The "unqualified" rating received from the auditor is considered by the college to be a step in the right direction as it works to remove itself from the probation instituted in November by the Middle States Commission on Higher Education, the entity which grants accreditation to area colleges.

“This administration inherited these challenges when we assumed leadership of Essex County College last summer,” ECC President Anthony Munroe said.  “Since that time we have been working together as a team to face these challenges head on and restore the college to its place of prominence.”

The college was given notice a year ago by the Middle States Commission that it was in jeopardy of losing its accreditation for its failure to comply with standards, including governance, student retention policies and institutional resources.

Although the Commission has now deemed the college in compliance with Student Admissions and Retention, the college was initially placed on probation due to its noncompliance with Institutional Resources and Leadership and Governance, according to the Commission's report.

The college remains accredited while on probation, with federal regulations limiting the period of noncompliance to two years.

A monitoring report—due from the college on March 1, 2018—must include documented evidence that the school has achieved compliance, including the development and implementation of a financial planning and budgeting process, both institution-wide and among departments.

The Commission has also requested the college implement institutional controls to deal with financial, administrative and auxiliary operations, along with policies and procedures to determine allocation of assets and an annual independent audit confirming financial responsibility.

Governing documents that delineate governance structure and provide for collegial governance are also to be provided to the Commission.

Commission representatives will visit the college following submission of the monitoring report.

Essex County Executive Joseph DiVincenzo, Jr. recently agreed to increase funding to the college.

At a meeting in mid-October, DiVincenzo agreed to give the college $1.5 million in operating expenses, a one-time payment of $1 million toward operational legal expenses, $1.25 million minor cap for annual funding and $1.25 million as a one-time bond project match.

The college had requested for fiscal year 2018 an additional $2 million for operating expenses, $800,000 for Operation of Public Safety Academy, $1,000,000 for operational legal expenses, $2,000,000 for fund balance, $1.2 million minor cap for annual funding and a one-time request of $2 million for a bonds project match.

DiVincenzo said the county is committed to working with Munroe and the college's Board of Trustees by providing the support and resources the college needs to right itself.

"We recently provided additional funds to help the college balance its budget and have committed to increasing the financial support that the County provides in the future to help the college through its financial crisis," DiVincenzo said in November. "Essex County College has provided generations of students with a strong educational foundation to help them succeed professionally, and we have confidence that Dr. Munroe and the Board will lead the college from Middle States probation.”

“The unqualified rating from our auditor is obviously a significant achievement as we work to shore up the weaknesses identified by Middle States,” ECC Board Chairman Thomas McDermott, Jr. said. “We are well on our way toward meeting our March 1 deadline to have all our issues remedied.”

McDermott succeeded former board chair Bibi Taylor while new board members include Carmen Morales, Isabel Cruz, Arnold Lewis, Johanna Wright, Rev. Lanel Guyton and Joseph Maceri.

The new board replaced former board members Calvin Souder, Safanya Searcy, Ralph Ciallella and Leila Sadeghi, all of whom joined the board within the last six months.

In response to governance issues cited by Middle States, the college has been working with the administration and new board members to ensure issues are addressed. 

Middle States’ action did not include any findings regarding the quality of the education offered by Essex County College, according to a college spokesperson.

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