Vermont State University Merger
Audit Title
Performance Audit of Vermont State University (VTSU) Realized Administrative and Operational Efficiencies and Cost Savings
Objective:
To determine whether the Vermont State University (VTSU) merger has achieved the planned administrative and operational efficiencies and cost savings outlined in the VSC transformation plan, particularly the goal of a $25 million structural deficit reduction.
Scope:
Focus on the administrative and operational areas targeted for consolidation across the formerly separate institutions (Castleton, NVU, VTC) over a specific post-merger period (e.g., the first two fiscal years).
Key Audit Areas and Procedures
Verification of Cost Savings Realization:
Compare total administrative and non-academic Full-Time Equivalent staff count and related personnel expenses pre-merger to post-merger figures to test documented savings from consolidated positions. Verify cost reductions from system and contract unification (e.g., software licenses, purchasing).
Efficiency and Process Improvement Assessment:
Select a key centralized process (e.g., student billing, payroll) and map the new VTSU process against the former processes to identify any new bottlenecks, increased processing times, or unexpected costs.
Internal Control Effectiveness:
Review and test the design and operating effectiveness of new internal controls for centralized administrative functions (e.g., cash disbursements, tuition revenue) to ensure accountability and segregation of duties were maintained.
Bridge Funding Utilization:
Trace the increased state appropriation and one-time "bridge funding" to ensure they were used only for the specific purposes authorized by the Legislature (e.g., transformation expenses).
Expected Value of the Audit:
Provides crucial accountability to the Legislature and taxpayers. It offers objective data on whether the major financial goals of the VSC merger are being met, helping VTSU management identify where projected savings haven't materialized and bolstering long-term financial stability.