Auditor’s office to investigate KCTCS


The Office of the Auditor of Public Accounts announced Monday it will conduct a special examination of the Kentucky Community and Technical College System following a request by the KCTCS Board of Regents.

That request was made by the Regents in March to begin an examination of the financial operations, internal policies and controls of the system.

According to the KCTCS, this was after leadership and the board were made aware the System Office had a fund balance that had not been properly classified to the board. The fund balance is nonrecurring funds that typically are used for items such as asset preservation or starting new programs. The System Office and the 16 KCTCS colleges all have fund balances used for these items.

The agreement to perform the special audit came in a letter sent Monday to Dr. Larry Ferguson, Acting KCTCS President, by Assistant State Auditor Farrah Petter.

The Auditor’s office letter said, “The special examination will primarily focus on the time period of July 1, 2020, through April 30, 2023, but may vary depending upon documentation and data available to review the concern. Additionally, at its discretion, the APA may expand the subject areas or duration of this examination to address high risk areas identified during our work.”

It went on to state that APA will issue a report upon completion of the office’s work, describing any weaknesses or deficiencies identified, and will offer recommendations to KCTCS to strengthen their financial controls.

The letter noted that under state law, “The APA is required to bill for any expenses incurred for this type of engagement to the entity that is the subject of the examination. APA’s current billing rate is $84/hour, with charges based on actual hours worked and expenses incurred. A preliminary estimate of the cost based upon an initial workplan projection of the special examination will be $67,200. This preliminary estimate is based on the expectation of complete and timely cooperation from KCTCS. If circumstances warrant a change in this estimate, we will notify you of the revised estimate and the basis for it.”

The special examination will begin on a mutually agreeable date and time.

KCTCS has nearly 100,000 students enrolled statewide at its 16 colleges, each of which has multiple locations, so 95% of Kentucky’s population is within a 30-minute drive.