STATE OF ILLINOISNORTHERN ILLINOIS UNIVERSITYCOMPLIANCE EXAMINATION(In Accordance With the Single Audit Act
and Applicable Federal Regulations)
For the Year Ended June 30, 2016
Performed as Special Assistant Auditors for
the Auditor General, State of Illinois

State of Illinois
Northern Illinois University
Compliance Examination(In Accordance With the Single Audit Act and Applicable Federal Regulations)
For the Year Ended June 30, 2016

TABLE OF CONTENTS

PAGE
INTRODUCTORY SECTIONAGENCY OFFICIALSMANAGEMENT ASSERTION LETTER

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COMPLIANCE REPORT
Summary
Auditors’ Reports:
Independent Accountants’ Report on State Compliance, onInternal Control Over Compliance, and on Supplementary
Information for State Compliance Purposes
Independent Auditors’ Report on Internal Control Over
Financial Reporting and on Compliance and Other Matters
Based on an Audit of Financial Statements Performedin Accordance With Government Auditing Standards
Independent Auditors’ Report on Compliance for Each
Major Federal Program, on Internal Control Over Compliance,and on the Schedule of Expenditures of Federal Awards
Required by the Uniform Guidance
Schedule of Findings and Questioned Costs:
Summary of Auditors’ Results
Current Findings:
Government Auditing Standards
State Compliance
Prior Findings Not Repeated
Summary Schedule of Prior Year Government Auditing Standards
and Federal Compliance Findings
Schedule of Expenditures of Federal Awards
Notes to Schedule of Expenditures of Federal Awards

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FINANCIAL STATEMENT REPORTThe University’s financial statement report for the year ended June 30, 2016, which includes theindependent auditors’ report, management’s discussion and analysis, basic financial statements
and notes, has been issued separately. The University’s report required under Government
Auditing Standards for the year ended June 30, 2016 which includes the independent auditors’
report on internal control over financial reporting and on compliance and other matters based on
an audit of basic financial statements performed in accordance with Government AuditingStandards has also been issued separately.

State of Illinois
Northern Illinois University
Compliance Examination(In Accordance With the Single Audit Act and Applicable Federal Regulations)
For the Year Ended June 30, 2016

TABLE OF CONTENTSSCHEDULEPAGE

SUPPLEMENTARY INFORMATION FOR STATECOMPLIANCE PURPOSES SECTION
Summary
Fiscal Schedules and Analysis:
Schedule of Appropriations, Expenditures, and Lapsed Balances
Comparative Schedule of Net Appropriations, Expenditures, andLapsed Balances
Comparative Schedule of Income Fund Revenues and Expenses
Schedule of Changes in Capital Assets
Comparative Schedule of Cash and Temporary Cash Equivalents,
at CostComparative Schedule of Investments, at Cost
Analysis of Receivables and Inventories
Analysis of Significant Variations in Expenses
Analysis of Significant Variations in Revenues
Analysis of Significant Variations in Account Balances
Analysis of Significant Lapse Period Spending
Schedule of Federal Expenditures, Nonfederal Expenses,
and New Loans
Entity Financial Statements:
Other Entities:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes
in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in
Plant Fund Balances
Auxiliary Business Operations, Service Departments, andIndirect Cost Support:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes
in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in
Plant Fund Balances

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State of Illinois
Northern Illinois University
Compliance Examination(In Accordance With the Single Audit Act and Applicable Federal Regulations)
For the Year Ended June 30, 2016

TABLE OF CONTENTSSCHEDULEPAGE

SUPPLEMENTARY INFORMATION FOR STATECOMPLIANCE PURPOSES (CONTINUED)
Entity Financial Statements (Continued):
Auxiliary Enterprises - Revenue Bond Funds:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes
in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in
Plant Fund Balances
Schedule of Indentured Capital Reserves (Unaudited)
Calculation Sheet for Current Excess Funds:
Other Entities (Unaudited)
Auxiliary Business Operations (Unaudited)
Service Departments (Unaudited)
Auxiliary Enterprises - Revenue Bond Funds (Unaudited)
Indirect Cost Support - Sources and Application of Indirect
Cost Recoveries
Calculation Sheet for Indirect Cost Support Carryforward
Description of Accounting Entities
Auxiliary Enterprises - Revenue Bond Funds - Schedule of
Revenues, Expenses, and Changes in Net Position
Analysis of Operations (Unaudited):
Cross-Reference Table of Reporting Requirements
University Functions and Planning Program (Unaudited)
Budget Impasse Disclosures (Unaudited)
Interest Costs on Fiscal Year 2016 Invoices (Unaudited)
Alternative Financing in Lieu of Appropriations and Programs toAddress Untimely Payments to Vendors (Unaudited)
Comparative Employment Statistics (Unaudited)
Emergency Purchases (Unaudited)
Comparative Enrollment Statistics (Unaudited)
Schedule of Tuition and Fee Waivers (Unaudited)
Debt Financed by University-Related Organization (Unaudited)
Acquisition of Real Estate Costing in Excess of $250,000
and Not Funded by a Separate Appropriation (Unaudited)
Bookstore Operations (Unaudited)

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State of Illinois
Northern Illinois University
Compliance Examination(In Accordance With the Single Audit Act and Applicable Federal Regulations)
For the Year Ended June 30, 2016

TABLE OF CONTENTS

PAGE
SUPPLEMENTARY INFORMATION FOR STATECOMPLIANCE PURPOSES (CONTINUED)
Analysis of Operations (Unaudited) (Continued):
Comments on Certain Matters Regarding Auxiliary Enterprises,
Activities, and Accounting Entities, and Tuition, Charges,
and Fees (Unaudited)
Comments on Certain Matters Regarding University-Related
Organizations and Other Matters (Unaudited)
Summary of Foundation Payments to/from the University (Unaudited)
Summary of Alumni Association Payments to/from the University (Unaudited)
Summary of Research Foundation Payments to/from the University (Unaudited)
Current Unrestricted Funds - Auxiliary Enterprises - Revenue Bond
Funds - Occupancy Report of Residence Halls (Unaudited)
Current Unrestricted Funds - Auxiliary Enterprises - Revenue Bond
Funds - Insured Value Summary (Unaudited)

OTHER REPORTS ISSUED UNDER SEPARATE COVER
Northern Illinois University Financial Statements - June 30, 2016
Northern Illinois University - Report Required Under Government
Auditing Standards for the Year Ended June 30, 2016

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State of Illinois
Northern Illinois University
Agency Officials
Douglas D. Baker

President

Lisa C. Freeman

Executive Vice President and Provost

Mike Mann

Associate Vice President, State Government Relations &Board Liaison

Anne C. Kaplan

Vice President, Outreach, Engagement, and Regional
Development

Brett Coryell

Vice President, Information Technology

Jerry Blazey

Interim Vice President, Research and Innovation
Partnerships

Sean T. Frazier

Associate Vice President and Director, Intercollegiate
Athletics

Eric A. Weldy (outgoing 12/31/16)

Vice President, Student Affairs and Enrollment
Management

Vernese Edghill-Walden

Senior Associate Vice President, Academic Diversity &Chief Diversity Officer

Catherine Squires

Vice President, University Advancement

Harlan Teller

Interim Vice President, Marketing and Communications

Jerry D. Blakemore (outgoing 12/31/16)

Vice President and General Counsel

Gregory A. Brady (incoming 1/1/17)

Acting Vice President and General Counsel

Danielle Schultz

Director of Internal Audit

Financial Staff
Alan Phillips (outgoing 2/28/17)

Vice President, Administration and Finance

Lawrence Pinkelton

Acting Chief Financial Officer

Shyree Sanan

Controller

NIU Office is located at:

300 Altgeld Hall
DeKalb, Illinois 60115

1

March 14, 2017

I

Northern Illinois
University

Division ofAdministration
and Finance

DeKalb, Illinois 60115-2828(815)753-1695
Fax: (815)753-1950

RSM US LLP
20 N. Martingale Rd.
Suite 500
Schaumburg, IL 60173

Ladies and Gentlemen:
We are responsible for the identification of, and compliance with, all aspects of laws, regulations, contracts, or
grant agreements that could have a material effect on the operations of the University. We are responsible for
and we have established and maintained an effective system of internal controls over compliancerequirements. We have performed an evaluation of the University's compliance with the following assertions
during the period ended June 30, 2016. Based on this evaluation, we assert that during the year ended
June 30, 2016 the University has materially complied with the assertions below.
A. The University has obligated, expended, received and used public funds of the State in accordancewith the purpose for which such funds have been appropriated or otherwise authorized by law.
8. The University has obligated, expended, received and used public funds of the State in accordancewith any limitations, restrictions, conditions or mandatory directions imposed by law upon suchobligation, expenditure, receipt or use.
C. The University has complied, in all material respects, with applicable laws and regulations, including
the State uniform accounting system, in its financial and fiscal operations.
D. State revenues and receipts collected by the University are in accordance with applicable laws andregulations and the accounting and recordkeeping of such revenues and receipts is fair, accurate
and in accordance with law.
E. Money or negotiable securities or similar assets handled by the University on behalf of the State orheld in trust by the University have been properly and legally administered, and the accounting andrecordkeeping relating thereto is proper, accurate and in accordance with law.
Yours truly,
Northern Illinois University

Douglas D. Baker, President

Lawrence Pinkelton, Acting Chief Financial Officer

Gregory A. Brady, Acting Vice President and General Counsel

State of Illinois
Northern Illinois University
Compliance Report Summary
For the Year Ended June 30, 2016
The compliance testing performed during this examination was conducted in accordance with
Government Auditing Standards (GAS) and in accordance with the Illinois State Auditing Act.
ACCOUNTANTS’ REPORTThe Independent Accountants’ Report on State Compliance, on Internal Control over Compliance and on
Supplementary Information for State Compliance Purposes does not contain scope limitations ordisclaimers. The report refers to other auditors. However, there is no other significant nonstandard
language.
SUMMARY OF FINDINGS
Number of
Findings
Repeated findings
Prior recommendations implemented or not repeated

Current
ReportPrior
Report

12
6
4

10
7
2

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Item
No.

Page

Description

Finding TypeFindings (Government Auditing Standards)
2016-001
2016-002

14
18

Financial Reporting Process
Inadequate Controls over Compensated Absences Data

Material Weakness
Significant Deficiency

Findings (State Compliance)
2016-003

19

Inadequate Internal Controls over Contracts

2016-004

23

Inadequate Control over Cash Receipts and Accounts
Receivable Recording and Reporting Processes

2016-005

25

Voucher Processing

2016-00627

Noncompliance with the Board of Higher Education Act

2016-007

28

Noncompliance with the Illinois Pension Code

2016-008

29

Noncompliance with the Freedom of Information and State
Records Retention Acts

2016-009

31

Failure to Submit Proper Time Reporting3

Significant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceState of Illinois
Northern Illinois University
Compliance Report Summary (Continued)
For the Year Ended June 30, 2016
Item
No.

Page

Description

Finding TypeFindings (State Compliance) (Continued)
2016-010

32

Procurement Card Use

2016-011

34

Inadequate Controls over Property and Equipment

2016-012

36

Noncompliance with the Higher Education VeteransService Act

Significant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceSignificant Deficiency
and NoncomplianceIn addition, the following finding which is reported as a current finding relating to Government AuditingStandards also meets the reporting requirements for State Compliance.
Findings (Government Auditing Standards )2016-001

14

Financial Reporting Process

2016-002

18

Inadequate Controls over Compensated Absences Data

Material Weakness
and NoncomplianceSignificant Deficiency
and Noncompliance

Prior Findings Not Repeated
A
B
C
D

37
37
37
37

Untimely After-the-Fact Verification of Time and Effort
Inadequate Documentation for Federal Program Expenditures
Incomplete TA-2 Forms
Failure to Comply with the University Faculty Researchand Consulting Act

EXIT CONFERENCE
The findings and recommendations appearing in this report were discussed with University personnel at
an exit conference on March 14, 2017. Attending were:
University:
Danielle Schultz
Lawrence Pinkelton
Shyree Sanan
Raul Garcia
Danell Jackowski
Kathy Marshall

Director of Internal Audit
Acting Chief Financial Officer
Controller
Deputy Controller
Accounts Payable Manager
General Ledger Manager

Office of the Auditor General:
Tom Kizziah

Audit Manager

RSM US LLP:
Joseph Evans
David Robydek
Sarah Darnall

Partner
Senior Manager
Supervisor

The responses to the recommendations were provided by Shyree Sanan in correspondence dated March
14, 2017.
4

Independent Accountants’ Report on State Compliance, onInternal Control Over Compliance, and on Supplementary
Information for State Compliance Purposes
Honorable Frank J. Mautino
Auditor GeneralState of Illinois andRobert T. Boey, Honorable Chair of theCompliance, Audit, Risk Management, and Legal Affairs Committee
Compliance
As Special Assistant Auditors for the Auditor General, we have examined Northern Illinois University’s(University) compliance with the requirements listed below, as more fully described in the Audit Guide forFinancial Audits and Compliance Attestation Engagements of Illinois State Agencies (Audit Guide) as
adopted by the Auditor General, during the year ended June 30, 2016. The management of the
University is responsible for compliance with these requirements. Our responsibility is to express an
opinion on the University’s compliance based on our examination.
A. The University has obligated, expended, received, and used public funds of the State inaccordance with the purpose for which such funds have been appropriated or otherwise
authorized by law.
B. The University has obligated, expended, received, and used public funds of the State inaccordance with any limitations, restrictions, conditions or mandatory directions imposed by law
upon such obligation, expenditure, receipt or use.
C. The University has complied, in all material respects, with applicable laws and regulations,
including the State uniform accounting system, in its financial and fiscal operations.
D. State revenues and receipts collected by the University are in accordance with applicable laws
and regulations and the accounting and recordkeeping of such revenues and receipts is fair,accurate and in accordance with law.
E. Money or negotiable securities or similar assets handled by the University on behalf of the Stateor held in trust by the University have been properly and legally administered and the accounting
and recordkeeping relating thereto is proper, accurate, and in accordance with law.
Our examination was conducted in accordance with attestation standards established by the American
Institute of Certified Public Accountants; the standards applicable to attestation engagements contained
in Government Auditing Standards issued by the Comptroller General of the United States; the Illinois
State Auditing Act (Act); and the Audit Guide as adopted by the Auditor General pursuant to the Act; and,accordingly, included examining, on a test basis, evidence about the University’s compliance with thoserequirements listed in the first paragraph of this report and performing such other procedures as we
considered necessary in the circumstances. We believe that our examination provides a reasonablebasis for our opinion. Our examination does not provide a legal determination on the University’scompliance with specified requirements.

5In our opinion, Northern Illinois University complied, in all material respects, with the compliancerequirements listed in the first paragraph of this report during the year ended June 30, 2016. However,
the results of our procedures disclosed instances of noncompliance with the requirements, which arerequired to be reported in accordance with criteria established by the Audit Guide, issued by the Illinois
Office of the Auditor General and which are described in the accompanying schedule of findings andquestioned costs as items 2016-001 through 2016-012.
Internal Control
Management of the University is responsible for establishing and maintaining effective internal control
over compliance with the requirements listed in the first paragraph of this report. In planning andperforming our examination, we considered the University’s internal control over compliance with therequirements listed in the first paragraph of this report to determine the examination procedures that areappropriate in the circumstances for the purpose of expressing our opinion on compliance and to test andreport on internal control over compliance in accordance with the Audit Guide, issued by the Illinois Officeof the Auditor General, but not for the purpose of expressing an opinion on the effectiveness of the
University’s internal control over compliance. Accordingly, we do not express an opinion on theeffectiveness of the University’s internal control over compliance.
Our consideration of internal control over compliance was for the limited purpose described in the firstparagraph of this section and was not designed to identify all deficiencies in internal control overcompliance that might be material weaknesses or significant deficiencies and therefore, material
weaknesses or significant deficiencies may exist that were not identified. However, as discussed below,
we identified certain deficiencies in internal control over compliance that we consider to be a material
weakness and significant deficiencies.
A deficiency in internal control over compliance exists when the design or operation of a control overcompliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with the requirements listed in the firstparagraph of this report on a timely basis. A material weakness in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance, such that there is areasonable possibility that material noncompliance with a requirement listed in the first paragraph of thisreport will not be prevented, or detected and corrected, on a timely basis. We consider the deficiency ininternal control over compliance described in the accompanying schedule of findings and questioned
costs as item 2016-001 to be a material weakness.
A significant deficiency in internal control over compliance is a deficiency, or a combination of
deficiencies, in internal control over compliance that is less severe than a material weakness in internal
control over compliance, yet important enough to merit attention by those charged with governance. We
consider the deficiencies in internal control over compliance, as described in the accompanying scheduleof findings and questioned costs as items 2016-002 through 2016-012 to be significant deficiencies.
As required by the Audit Guide, immaterial findings excluded from this report have been reported in a
separate letter to your office.
The University’s responses to the findings identified in our examination are described in theaccompanying schedule of findings and questioned costs. We did not examine the University’s
responses and, accordingly, we express no opinion on the responses.
Supplementary Information for State Compliance Purposes
As Special Assistant Auditors for the Auditor General, we have audited the financial statements of thebusiness-type activities and aggregate discretely presented component units of Northern Illinois
University as of and for the year ended June 30, 2016, and have issued our report thereon dated January
17, 2017. Our report contains emphasis of matter paragraphs for the accounting treatment of theappropriations granted under Public Act 099-0524 and for the lack of an appropriations bill to fund the
University’s fiscal year 2017 operations. Our opinion is not modified with respect to either of thesematters. Our report includes a reference to other auditors who audited the financial statements of the6University’s discretely presented component units, as described in our report on the University’s financial
statements. Our audit was conducted for the purpose of forming opinions on the financial statements thatcollectively comprise the University’s basic financial statements. We have not performed any procedureswith respect to the audited financial statements subsequent to January 17, 2017. The accompanying
supplementary information for the year ended June 30, 2016 in Schedules 1 through 15 and 21 through24 is presented for the purposes of additional analysis and is not a required part of the basic financial
statements of the University. Such information is the responsibility of management and was derived fromand relates directly to the underlying accounting and other records used to prepare the basic financial
statements. The accompanying supplementary information for the year ended June 30, 2016 in
Schedules 1 through 15 and 21 through 24 has been subjected to the auditing procedures applied in theaudit of the basic financial statements and certain additional procedures, including comparing andreconciling such information directly to the underlying accounting and other records used to prepare thebasic financial statements or to the basic financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In
our opinion, the accompanying supplementary information for the year ended June 30, 2016 in Schedules
1 through 15 and 21 through 24 is fairly stated in all material respects in relation to the basic financial
statements as a whole for the year ended June 30, 2016.
We also previously audited, in accordance with auditing standards generally accepted in the UnitedStates of America, the University’s basic financial statements as of and for the year ended June 30, 2015
(not presented herein), and have issued our report thereon dated February 3, 2016 which contained
unmodified opinions on financial statements of the business-type activities and the aggregate discretely
presented component units. Our report included a reference to other auditors and an emphasis of amatter paragraph for the implementation of Governmental Accounting Standards Board Statements No.
68 and 71. The accompanying supplementary information for the year ended June 30, 2015 in
Schedules 2 through 10 is the responsibility of management and was derived from and relates directly tothe underlying accounting and other records used to prepare the June 30, 2015 financial statements. The
accompanying supplementary information for the year ended June 30, 2015 in Schedules 2 through 10
has been subjected to the auditing procedures applied in the audit of the June 30, 2015 basic financial
statements and certain additional procedures, including comparing and reconciling such information
directly to the underlying accounting and other records used to prepare those basic financial statements
or to those basic financial statements themselves, and other additional procedures in accordance withauditing standards generally accepted in the United States of America. In our opinion, the accompanying
supplementary information for the year ended June 30, 2015 in Schedules 2 through 10 is fairly stated in
all material respects in relation to the basic financial statements as a whole from which it has been
derived.
The accompanying supplementary information in the Analysis of Operations Section and in Schedules 16
through 20 is presented for the purposes of additional analysis and is not a required part of the basic
financial statements. Such information has not been subjected to the auditing procedures applied in theaudit of the basic financial statements, and accordingly, we do not express an opinion or provide any
assurance on it.
This report is intended solely for the information and use of the Auditor General, the General Assembly,
the Legislative Audit Commission, the Governor, University management, the University’s Board ofTrustees and federal awarding agencies and pass-through entities and is not intended to be and should
not be used by anyone other than these specified parties.

Schaumburg, Illinois
March 14, 2017, except for our report on the Supplementary Informationfor State Compliance Purposes, as to which the date is January 17, 2017.
7

Independent Auditors’ Report on Internal Control Over Financial Reportingand on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in Accordance with
Government Auditing Standards

Honorable Frank J. Mautino
Auditor GeneralState of Illinois andCherilyn G. Murer, Honorable Chair of theCompliance, Audit, Risk Management, and Legal Affairs Committee
As Special Assistant Auditors for the Auditor General, we have audited, in accordance with the auditing
standards generally accepted in the United States of America and the standards applicable to financial
audits contained in Government Auditing Standards issued by the Comptroller General of the UnitedStates, the financial statements of the business-type activities of Northern Illinois University (University)and its aggregate discretely presented component units, collectively a component unit of the State of
Illinois, as of and for the year ended June 30, 2016, and the related notes to the financial statements,
which collectively comprise the University’s basic financial statements, and have issued our report
thereon dated January 17, 2017. Our report contains emphasis of matter paragraphs for the accounting
treatment of the appropriations granted under Public Act 099-0524 and for the lack of an appropriations
bill to fund the University’s fiscal year 2017 operations. Our opinion is not modified with respect to eitherof these matters. Our report includes a reference to other auditors who audited the financial statements of
the University’s discretely presented component units, as described in our report on the University’s
financial statements. This report does not include the results of the other auditors’ testing of internal
control over financial reporting or compliance and other matters that are reported on separately by those
auditors.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the University’s internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate in
the circumstances for the purpose of expressing our opinion on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the University’s internal control. Accordingly,
we do not express an opinion on the effectiveness of the University’s internal control.
Our consideration of internal control was for the limited purpose described in the first paragraph of thissection and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may
exist that were not identified. However, as described in the accompanying schedule of findings, we
identified certain deficiencies in internal control that we consider to be a material weakness and asignificant deficiency.

8A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a
combination of deficiencies, in internal control such that there is a reasonable possibility that a material
misstatement of the entity’s financial statements will not be prevented, or detected and corrected on atimely basis. We consider the deficiency described in the accompanying schedule of findings as item
2016-001 to be a material weakness.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is lesssevere than a material weakness, yet important enough to merit attention by those charged withgovernance. We consider the deficiency described in the accompanying schedule of findings as item
2016-002 to be a significant deficiency.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the University’s financial statements are free frommaterial misstatement, we performed tests of its compliance with certain provisions of laws, regulations,contracts, and grant agreements, noncompliance with which could have a direct and material effect on thedetermination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The resultsof our tests disclosed no instances of noncompliance or other matters that are required to be reported under
Government Auditing Standards.
Northern Illinois University’s Response to Findings
The University’s responses to the findings identified in our audit are described in the accompanying
schedule of findings. The University’s responses were not subjected to the auditing procedures applied in
the audit of the financial statements and, accordingly, we express no opinion on the responses.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance andthe results of that testing, and not to provide an opinion on the effectiveness of the University’s internal control
or on compliance. This report is an integral part of an audit performed in accordance with Government AuditingStandards in considering the University’s internal control and compliance. Accordingly, this communication is
not suitable for any other purpose.

Schaumburg, Illinois
January 17, 20179

Independent Auditors’ Report on Compliance for
Each Major Federal Program, on Internal Control
Over Compliance, and on the Schedule of Expendituresof Federal Awards Required by the Uniform Guidance

Honorable Frank J. Mautino
Auditor GeneralState of Illinois
andRobert T. Boey, Honorable Chair of theCompliance, Audit, Risk Management, and Legal Affairs Committee
Report on Compliance for Each Major Federal Program
We have audited Northern Illinois University’s (University) compliance with the types of compliancerequirements described in the OMB Compliance Supplement that could have a direct and material effect oneach of the University’s major federal programs for the year ended June 30, 2016. The University’s major
federal programs are identified in the summary of auditor’s results section of the accompanying schedule offindings and questioned costs.
The schedule of expenditures of federal awards and our audit described below does not include expendituresof federal awards for those agencies determined to be component units of the University for financial
statement purposes.
Management’s Responsibility
Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants
applicable to its federal programs.
Auditors’ Responsibility
Our responsibility is to express an opinion on compliance for each of the University’s major federal programs
based on our audit of the types of compliance requirements referred to above. We conducted our audit ofcompliance in accordance with auditing standards generally accepted in the United States of America; thestandards applicable to financial audits contained in Government Auditing Standards, issued by theComptroller General of the United States, and the audit requirements of Title 2 U.S. Code of Federal
Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit
Requirements for Federal Awards (Uniform Guidance). Those standards and Uniform Guidance requirethat we plan and perform the audit to obtain reasonable assurance about whether noncompliance with thetypes of compliance requirements referred to above that could have a direct and material effect on a major
federal program occurred. An audit includes examining, on a test basis, evidence about the University’scompliance with those requirements and performing such other procedures as we considered necessary inthe circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal
program. However, our audit does not provide a legal determination of the University’s compliance.

10

Opinion on Each Major Federal Program
In our opinion, the University complied, in all material respects, with the types of compliance requirements
referred to above that could have a direct and material effect on each of its major federal programs for theyear ended June 30, 2016.
Report on Internal Control Over ComplianceManagement of the University is responsible for establishing and maintaining effective internal control overcompliance with the types of compliance requirements referred to above. In planning and performing our
audit of compliance, we considered the University’s internal control over compliance with the types ofrequirements that could have a direct and material effect on each major federal program to determine theauditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion oncompliance for each major federal program and to test and report on internal control over compliance inaccordance with the Uniform Guidance, but not for the purpose of expressing an opinion on theeffectiveness of internal control over compliance. Accordingly, we do not express an opinion on theeffectiveness of the University’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control overcompliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal
program on a timely basis. A material weakness in internal control over compliance is a deficiency, or
combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility
that material noncompliance with a type of compliance requirement of a federal program will not be
prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control overcompliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type ofcompliance requirement of a federal program that is less severe than a material weakness in internal control
over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the firstparagraph of this section and was not designed to identify all deficiencies in internal control over compliancethat might be material weaknesses or significant deficiencies and therefore, material weaknesses orsignificant deficiencies may exist that were not identified. We did not identify any deficiencies in internal
control over compliance that we consider to be material weaknesses. However, material weaknesses may
exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control over compliance and the results of that testing based on the requirements of the
Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

11

Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance
We have audited the financial statements of the business-type activities and the aggregate discretely
presented component units of the University as of and for the year ended June 30, 2016, and the related
notes to the financial statements, which collectively comprise the University’s basic financial statements. We
issued our report thereon dated January 17, 2017, which contained unmodified opinions on those financial
statements. Our report contained emphasis of matters paragraphs regarding appropriations revenue
recognition related to Public Act 099-0524 and the lack of appropriations to fund the University’s fiscal year2017 operations and included a reference to other auditors. Our audit was conducted for the purpose offorming opinions on the financial statements that collectively comprise the basic financial statements. We
have not performed any procedures with respect to the audited financial statements subsequent toJanuary 17, 2017. The accompanying schedule of expenditures of federal awards is presented for purposesof additional analysis as required by the Uniform Guidance and is not a required part of the basic financial
statements. Such information is the responsibility of management and was derived from and relates directly
to the underlying accounting and other records used to prepare the basic financial statements. The
information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain other additional procedures, including comparing and reconciling such information
directly to the underlying accounting and other records used to prepare the basic financial statements or to
the basic financial statements themselves, and other additional procedures in accordance with auditing
standards generally accepted in the United States of America. In our opinion, the schedule of expendituresof federal awards is fairly stated in all material respects in relation to the basic financial statements taken as awhole.

Schaumburg, Illinois
March 14, 2017, except for the Schedule of Expendituresof Federal Awards, as to which the date is January 17, 201712

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs
Summary of Auditors’ Results
For the Year Ended June 30, 2016

Financial Statements
Type of auditor's report issued on whether the financial statements
audited were prepared in accordance with GAAP:

Unmodified

Internal control over financial reporting:••Material weakness(es) identified?
Significant deficiencies identified that are notconsidered to be material weakness(es)?

X

Yes

No

X

Yes

No

Noncompliance material to financial statements noted?

Yes

X

No

Yes
Yes

X
X

No
No

X

No

Federal Awards
Internal control over major programs:••

Material weakness(es) identified?
Significant deficiency(ies) identified?

Type of auditors’ report issued on compliancefor major programs:

Unmodified

Any audit findings disclosed that are required
to be reported in accordance with Section 2 CFR 200.516(a)Yes

Identification of major programs:
Name of Federal Program or Cluster

CFDA Number

Student Financial Assistance Cluster

84.00784.03384.03884.06384.26884.379English Language Acquisition State Grants

84.365

Dollar threshold used to distinguish between
Type A and Type B programs:$750,000

Auditee qualified as low-risk auditee?

Yes

13

X

No

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs
Current Findings – Government Auditing Standards
For the Year Ended June 30, 2016
Finding 2016-001

Financial Reporting Process

Northern Illinois University’s (the University) internal controls over financial reporting are not sufficient to prevent
misstatements.
During our audit of the significant balances comprising the University’s financial statements we noted thefollowing errors and deficiencies:
Errors Related to the Recording of Capital Assets•

The University improperly capitalized $1,267,471 of asbestos remediation costs as a capital asset
instead of expensing them in fiscal year 2015. As the amount was not material to the financial
statements, an audit adjustment was booked in fiscal year 2016 to remove the costs from capital assets
by expensing them rather than restating opening net position. This corrects the year-end balance ofcapital assets and net position but results in current year operating expenses being overstated by$1,267,471.

Governmental Accounting Standards Board Statement No. 49, Accounting and Financial Reporting for
Pollution Remediation Obligations, states that, except in certain circumstances, “pollution remediation
outlays, including outlays for property, plant, and equipment, should be reported as an expense.” None of thecircumstances applied to the University.
•

The University has improperly capitalized net library book activity (additions – disposals) as an addition
each year instead of separately tracking additions and deletions. This impacts the financial statements
as the University is keeping older, fully depreciated books on its asset listing and expensing a portion of
its additions each year instead of capitalizing them. Additionally, in fiscal year 2016, there was a formulaerror in the University’s calculation and disposals were added to additions instead of subtracted. When
informed of the error, the University recorded a correcting entry which reduced net capital assets by$3,013,864 and increased operating expenses by the same amount. This partially corrected the error
and an unrecorded audit adjustment was proposed to fully correct the misstatement. This results in net
capital assets and opening net position being understated by $2,512,884 and $1,844,552 respectively
and current year operating expenses being overstated by $668,332.

Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements - andManagement's Discussion and Analysis - for State and Local Governments, as amended by Governmental
Accounting Standards Board Statement No. 37, Basic Financial Statements — and Management's
Discussion and Analysis — for State and Local Governments: Omnibus - an Amendment of GASBStatements No. 21 and No. 34, states that, “capital assets should be reported at historical cost. The costof a capital asset should include ancillary charges necessary to place the asset into its intended locationand condition for use. Ancillary charges include costs that are directly attributable to asset acquisition —such as freight and transportation charges, site preparation costs, and professional fees.”•

The University improperly capitalized the amounts noted below as fiscal year 2016 capital asset
additions. They were evaluated together for the purposes of determining a proposed adjustment:
o $3,100,743 of costs already capitalized as an addition in fiscal year 2015o $49,850 of costs billed in error by a vendor and refunded to the University
o $32,908 of costs for which the University cannot provide a vendor invoiceo $11,520 of employee training costs
o $1,970 of overhead allocation for which there is not sufficient documentation to support that thecosts were necessary to place the asset into service
14

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – Government Auditing Standards
For the Year Ended June 30, 2016
Finding 2016-001

Financial Reporting Process (Continued)

No adjustment was recorded which results in net capital assets being overstated at year-end by$3,012,275 and operating expenses being understated by the same amount. The year-end misstatement
is less than the amount of errors noted above due to the depreciation the University recorded on theassets during the fiscal year totaling $184,716.
Governmental Accounting Standards Board Statement No. 51, Accounting and Financial Reporting for
Intangible Assets, states that application training is a post-implementation/operation stage activity andthat, “outlays associated with activities in the post-implementation/operation stage should be expensed as
incurred.”•

The University expensed $398,006 of leasehold improvements for one of its facilities in fiscal year 2015
instead of capitalizing the cost to capital assets and amortizing it over the life of the lease. The
improvement should have been considered an intangible asset as the University has a legal right to use
the improvements over the course of the lease. This results in a year-end understatement of net capital
assets and ending net position of $250,430 and a $53,664 understatement of operating expenses. No
adjustment was proposed as the dollar amounts were not individually significant to the financial
statements.

Governmental Accounting Standards Board Statement No. 51, Accounting and Financial Reporting for
Intangible Assets, states that an intangible asset should be recognized on the statement of net position if
it “arises from a contractual or legal right” and should be treated as a capital asset and amortized over thelife of the lease.
Errors Related to Revenue Recognition•

The University participates in the Perkins Loan program under which it makes loans to students using
both institutional and federal funds. The University has a receivable recorded for the loans and interest
owed by students under the program and a liability recorded for the amount of the receivable that must
be repaid to the federal government when the program is closed. In fiscal year 2005 the University
recognized revenue of $784,920 for interest and fees students owed on the loans and increased therecorded loan receivable by the same amount. This receivable was to be reversed in fiscal year 2006
when the University received the interest and fees but was never reversed resulting in revenue being
recorded twice. No adjustment was recorded in fiscal year 2016 to remove the receivable which results
in an overstatement of net student loans, government loan fund advances, and opening net position by$784,920, $675,031, and $109,889 respectively. The overstatement of the receivable is split between
the University’s opening net position and amount owed to the federal government as the liability is
adjusted each year based on the net income or loss generated by the loan program.

•

The University improperly excluded $453,805 from its calculation of revenues earned over the course of
the summer session and are therefore only partially earned as of year-end. This resulted in the
University recognizing $290,901 more summer session tuition and fees revenue in fiscal year 2016 thanwas earned and understating unearned tuition and fees by the same amount. No adjustment was
proposed as the dollar amount was not individually significant to the financial statements.

•

The University did not set up a receivable for $69,996 of operating revenue earned in fiscal year 2015
and recognized it as revenue in fiscal year 2016 when it was received. No adjustment was proposed as
the dollar amount was not individually significant to the financial statements.

15

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – Government Auditing Standards
For the Year Ended June 30, 2016
Finding 2016-001

Financial Reporting Process (Continued)•

The University did not recognize $41,481 of revenue that was earned during fiscal years 2014 and2015 for services provided to the Illinois Board of Examiners. This resulted in beginning and ending
net position being understated by $41,481. No adjustment was proposed as the dollar amount was notindividually significant to the financial statements.

•

The University recorded $8,217 of billed revenue as unearned; however, the University provided services
for the amount billed in fiscal year 2016 and thus should have considered the revenue earned. No
adjustment was proposed as the dollar amount was not individually significant to the financial statements.

•

The University recognizes parking pass revenues on a cash basis instead of on an accrual basis.
Parking passes that can be used in fiscal year 2017, and for which a portion of the revenue should havebeen classified as unearned, went on sale starting December 2015. Management has not determined
the specific dollar amount of the sales that should have been classified as unearned. It should be notedthat total sales between December 1, 2015 and June 30, 2016 totaled $271,447 and the error amountwould be less. No adjustment was proposed as the dollar amount was not individually significant to thefinancial statements.

Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements - andManagement's Discussion and Analysis - for State and Local Governments, as amended by Governmental
Accounting Standards Board Statement No. 37, Basic Financial Statements — and Management's
Discussion and Analysis — for State and Local Governments: Omnibus - an Amendment of GASBStatements No. 21 and No. 34, states that, “the statement of net position and the statement of revenues,
expenses, and changes in net position should be prepared using the economic resources measurement
focus and the accrual basis of accounting. Revenues, expenses, gains, losses, assets, and liabilities
resulting from exchange and exchange-like transactions should be recognized when the exchange takes
place.”
Errors Noted Related to Classification and Presentation•

The University did not properly eliminate all inter-university transactions from the financial statements.
The proposed adjustment was not recorded resulting in operating revenues and expenses being
overstated by $2,087,937.

•

The University did not properly record expenses related to credit card and bank fees. We noted the
University records credit card fees as a reduction of operating revenue and then records an adjusting
entry to recognize credit card fee expense and increase revenue back to the gross amount. The
adjusting entries booked by the University did not fully recapture all of the improperly reduced revenue
amounts which resulted in operating revenues and expenses being understated by $57,888. No
adjustment was proposed as the dollar amount was not individually significant to the financial statements.

•

The University did not properly eliminate a transfer of resources between University departments. Thistransfer decreased the amount of revenue and expense reported by the University by $20,806. No
adjustment was proposed as the dollar amount was not individual significant to the financial statements.

16

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – Government Auditing Standards
For the Year Ended June 30, 2016
Finding 2016-001

Financial Reporting Process (Continued)

Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements - andManagement's Discussion and Analysis - for State and Local Governments, as amended by Governmental
Accounting Standards Board Statement No. 37, Basic Financial Statements — and Management's
Discussion and Analysis — for State and Local Governments: Omnibus - an Amendment of GASBStatements No. 21 and No. 34, states that, “eliminations should be made in the statement of activities toremove the “doubling-up" effect of internal service fund activity. The effect of similar internal events (suchas allocations of accounting staff salaries) that are, in effect, allocations of overhead expenses from one
function to another or within the same function also should be eliminated, so that the allocated expenses
are reported only by the function to which they were allocated.”
Further, the Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires all State agencies toestablish and maintain a system, or systems, of internal fiscal and administrative controls, to provide
assurance that revenues, expenditures, and transfers of assets, resources, or funds applicable to operations
are properly recorded and accounted for to permit the preparation of accounts and reliable financial andstatistical reports and to maintain accountability over the State’s resources.
According to University management, the errors noted above were due to several factors. The Controller’s
Office experienced high staff turnover due to retirements and a competitive market which resulted in loss ofinstitutional knowledge and technical expertise. Budget constraints and cost curtailment initiatives requiring
additional review of critical positions delayed refill of positions to meet year-end objectives. In addition,
manual processes and underutilized systems capacity are prone to human error.
Inaccuracies in the recorded amounts of the University’s financial statement balances delays completion of
the audit process and delays the timely release of the University’s financial reports to users. Also insufficient
and/or ineffective controls over financial reporting could lead to significant reporting inaccuracies in thefinancial statements. (Finding Code No. 2016-001, 2015-001, 2014-001, 2013-001, 2012-001, 2011-001)
Recommendation
We recommend the University improve controls over financial reporting to ensure accurate presentation anddisclosure of the University’s annual financial statements.
University Response
The University accepts the auditor’s recommendation. Management has conducted a comprehensive
review of each component of this finding and is taking the following corrective actions that will eliminate
all material exceptions:
1) University will modify procedures to track and report capital projects and all fixed assets to ensure
proper accounting for capital assets.
2) University has begun to modify written policies and procedures, and develop communication andtraining programs around revenue recognition to ensure proper year-end recognition of revenue.
3) University has assessed opportunities for system enhancements and will work towards
implementation of various functionalities and ERP modules that will streamline workflows, create
efficiencies, and reduce opportunities for human errors.
4) And finally the University has initiated recruitment efforts to fill critical positions to meet year-end
financial reporting objectives.

17

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – Government Auditing Standards
For the Year Ended June 30, 2016
Finding 2016-002

Inadequate Controls over Compensated Absences Data

Northern Illinois University (the University) did not use accurate information to determine its year-end accrualfor compensated absences.
We tested a sample of nine employees to determine if the University was properly accounting for leave timeearned and used during the year and noted errors for five of the nine employees. For two of the employees,
the hours earned during the pay period ended June 30, 2016 were excluded from their year-end accrued
balance and for the remaining three employees the vacation time taken during the first pay period in fiscal
year 2017 was subtracted from their June 30, 2016 balances.
We discussed these issues with the University and asked that the accrued balances be reexamined. The
University then identified a total of 57 employees whose June 30, 2016 balances did not include all the hours
earned as of year-end and 626 employees whose June 30, 2016 balance had been reduced by vacation time
taken in fiscal year 2017. These errors resulted in a $193,816 understatement of the compensated absences
accrual and operating expenses. No adjustment was proposed as the total error amount was not significant
to the financial statements.
Governmental Accounting Standards Board Statement No. 16, Accounting for Compensated Absences,
states that “vacation leave and other compensated absences with similar characteristics should be
accrued as a liability as the benefits are earned by the employee.”
Further, the Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires all State agencies toestablish and maintain a system, or systems, of internal fiscal and administrative controls, to provide
assurance that revenues, expenditures, and transfers of assets, resources, or funds applicable to operations
are properly recorded and accounted for to permit the preparation of accounts and reliable financial andstatistical reports and to maintain accountability over the State’s resources.
According to University management, the errors noted above were due to both a system change and thetiming of when the report was produced.
Using inaccurate data to determine amounts recorded in the financial statements could cause the financials
to be misstated. (Finding Code No. 2016-002)
Recommendation
We recommend the University improve its processes to account for accrued leave to ensure year-end
balances are accurate.
University Response
The University accepts the auditor’s recommendation. Management has updated procedures necessary
to ensure system inputs and all corresponding management reporting is accurate.

18

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings
Finding 2016-003

Inadequate Internal Controls over Contracts

Northern Illinois University has not established adequate internal controls over contracts to ensure that they
are approved prior to performance and comply with all applicable state requirements.
During our review of 84 contracts in effect during the year ending June 30, 2016 we noted the following:•

27 contracts (32%) were missing one or more of the below certifications/clauseso Child Labor Act Certification (17 contracts, 20%)o Forced Labor Act Certification (17 contracts, 20%)o Prevailing Wage Act Certification (1 contract, 1%)
o International Anti-Boycott Certification (7 contracts, 8%)
o Appropriation Contingency Clause (17 contracts, 20%)o Contractor’s Federal Taxpayer Identification Number and Legal Status Disclosure
Certification (9 contracts, 11%)o Access to and Right to Audit Records Certification (15 contracts, 18%)•

11 contracts (13%) did not have a contract obligation document filed with the Illinois State
Comptroller’s Office. Each contract contained an order for delivery that exceeded $20,000.

•

8 contracts (10% and totaling $10,666,510) were not approved prior to goods or services being
provided.

•

The public procurement files for 5 contracts (6% and totaling $1,201,077) did not contain all theevaluation material used to determine the vendor to whom the contract was awarded. Eachcontract was awarded under qualified based selection procurement rules.

•

2 contracts (2%) exceeding $50,000 each were approved without obtaining the vendors’
disclosure of financial interest form.

Additionally, we noted the University gave a vendor two orders for tree trimming services on July 1, 2015.
One order was for $55,400 while the other was for $50,000. If combined these orders would haveexceeded the small purchasing threshold of $55,800 and would have been required to be put out to bid.
Per inquiry of the University, the orders were not combined as two different departments requested theservice and had different funding sources. We note that the University has a centralized procurement
function and that a benefit of a centralized purchasing function is that different departments’ needs can be
combined when obtaining goods and services.
The Illinois Administrative Code (44 Ill. Admin. Code 4.15) states that a contract means all types of Stateagreements, regardless of what they are called, for the procurement, use, or disposal of supplies,
services, professional or artistic services, or construction or for leases of real property.
The State Prohibition of Goods from Child Labor Act (30 ILCS 584/10) states that every contract enteredinto by any State agency for the procurement of equipment, materials, or supplies, other thanprocurement related to a public works contract, must specify that no foreign-made equipment, materials,
or supplies furnished to the State under the contract may be produced in whole or in part by the labor of
any child under the age of 12. The contractor must agree to comply with this provision of the contract.

19

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-003

Inadequate Internal Controls over Contracts (Continued)

The State Prohibition of Goods from Forced Labor Act (30 ILCS 583/10) states that every contract
entered into by any State agency for the procurement of equipment, materials, or supplies, other thanprocurement related to a public works contract, must specify that no foreign-made equipment, materials,
or supplies furnished to the State under the contract may be produced in whole or in part by forced labor,
convict labor, or indentured labor under penal sanction. The contractor must agree to comply with thisprovision of the contract.
The Prevailing Wage Act (820 ILCS 130/4 (a-1)) states that the University must include a clause in any
contract for the construction of fixed works, including the maintenance, repair, assembly, or disassembly
work performed on equipment whether owned, leased, or rented, that not less than the prevailing wage
rate shall be paid to all laborers, workers, and mechanics working under the contract.
The International Anti-Boycott Certification Act (30 ILCS 582/5) states that every contract entered into by
the State of Illinois for the manufacture, furnishing, or purchasing of supplies, material, or equipment or
for the furnishing of work, labor, or services, in an amount exceeding the Illinois’ threshold for smallpurchases or $10,000, whichever is less, shall contain certification, as a material condition of the contract,by which the contractor agrees that neither the contractor nor any substantially-owned affiliated company
is participating or shall participate in an international boycott in violation of the provisions of the U.S.
Export Administration Act of 1979 or the regulations of the U.S. Department of Commerce promulgatedunder that Act.
The Illinois Procurement Code (30 ILCS 500/20-60(b)) states that all contracts made or entered into shallrecite that they are subject to termination and cancellation in any year for which the General Assembly
fails to make an appropriation to make payments under the terms of the contract.
State of Illinois Accounting Bulletin No. 59 states that all purchase orders filed or obligated by universities
with the Comptroller contain a vender certification stating that the contractor has provided the State acorrect Federal Taxpayer Identification Number and legal status disclosure.
The Illinois Procurement Code (30 ILCS 500/20-65(b)) states that every contract or subcontract require
the contractor or subcontractor to maintain books or records relating to performance under the contractand necessary to support amounts charged under the contract for a period of at least 3 years after final
payment is made by the State and that the records must be made available for review and audit by the
Auditor General, chief procurement officer, internal auditor, and the purchasing agency. The contractor or
subcontractor shall fully cooperate with any audit.
The Statewide Accounting Management System procedure number 15.10.40 states that individual
purchases or orders for delivery of services, commodities, or equipment that exceed $20,000 must be
filed with the Comptroller.
Northern Illinois University Business Procedure Manual Procedure No. 9-2 states all purchases must be
made with a purchase order or P-Card and that a purchase order requires at least a procurement
services buyer’s signature.

20

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-003

Inadequate Internal Controls over Contracts (Continued)

The Illinois Administrative Code (44 Ill. Admin. Code 4.2080) states that a public procurement file shall bemaintained for all contracts regardless of the method of procurement and contain the basis on which theaward was made including all evaluation material, score sheets, and other documentation related to or
prepared in conjunction with the evaluation.
The Illinois Administrative Code (44 Ill. Admin. Code 4.5035) states that disclosures of financial interests andpotential conflicts of interest be obtained from all bidders and offers when the annual value of the bid or offer
exceeds $50,000. It also states these disclosures must also be obtained for small purchases [i.e. below thebid threshold] when it exceeds $50,000.
The Illinois Procurement Code (30 ILCS 500/20-5 through 30 ILCS 500/20-20) states that unless otherwise
authorized by law, all State contracts shall be awarded by competitive sealed bidding. One exception is the
procurement of supplies and non-professional and non-artistic services not exceeding $10,000 adjusted each
July 1, for inflation. Chief Procurement Officers may, by rule, modify this amount. During fiscal year 2016,
this modified amount was $55,800.
The Illinois Northern Illinois University Business Procedure Manual Procedure No. 9-2 states that bids orother competitive source selections are required for general supplies and services that exceed $55,800.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that
resources are utilized efficiently, effectively, and in compliance with applicable law; obligations and costs arein compliance with applicable law; funds, property, and other assets and resources are safeguarded against
waste, loss, unauthorized use, and misappropriation; revenues, expenditures, and transfers of assets,
resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState's resources; and funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist.
University officials stated it was the University’s understanding certifications were not required unless there
was a two-party signed agreement for the purchase and contract obligation documents were not required tobe reduced to writing for purchases of commodities or equipment. They also stated several University
departments initiated purchases prior to requesting authorization to make the purchase and the two missing
disclosures of financial interest were due to an oversight. Finally, University officials noted evaluators ofvendors’ responses to qualified based selection procurement requests were not required to turn in their notesor scoring sheets.

21

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-003

Inadequate Internal Controls over Contracts (Continued)

Failure to include all required certifications may result in goods or services received failing to comply with
State statutes and regulations while not filing contract obligation documents with the Comptroller’s office isnoncompliance with a State regulation. Not fully executing a contract prior to the commencement of services
or delivery of goods leaves the University vulnerable to unnecessary liabilities and potential legal problems
while not having complete documentation of how a vendor was selected could bring the University’scompliance with the Procurement Code into question. Finally, not obtaining required conflict of interest forms
and not combining similar purchases together for bids could result in the University procuring goods orservices at a higher rate than would have otherwise been paid. (2016-003, 2015-005, 2014-006, 2013-007,
12-7)
Recommendation
We recommend the University implement appropriate procedures to ensure contracts are complete, areproperly approved prior to performance, and supported with complete public procurement files.
University Response
The University accepts the Auditor’s recommendation. Management has conducted a comprehensive
review of each component of this finding and is taking the following corrective actions that will eliminate
material exceptions:
1) Develop terms and conditions boilerplate for purchase orders, which reference attestation to allstate-mandated certifications, and revise current certification form in the University’s request for
proposal and invitation to bid forms to cover adherence to all other certifications that may not be
included in the State’s form.
2) Receive clarification of SAMs Manual from IL Comptroller’s Office on the filing of contract
obligations documents as relates to services.
3) The process for reviewing and negotiating Architectural, Engineering, and Land Surveying
Qualifications Based Selection contracts has been revamped to ensure all files are complete.
4) Continue to develop and expand the newly created contract management process to eliminate
performance or delivery before contract.

22

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-004

Inadequate Control over Cash Receipts and Accounts Receivable
Recording and Reporting Processes

Northern Illinois University (University) did not exercise adequate control over its cash receipts and accounts
receivable recording and reporting processes.
We tested 49 cash receipts received by the University during fiscal year 2016 totaling $2,053,968 and noted
the following•••

One receipt (2%) of $15,000 was payment for services provided in a prior fiscal year for which there
was no recorded receivable. This resulted in the University recognizing $15,000 of revenue in thewrong fiscal year. The University was also still providing services to the customer in fiscal year 2016
and as of June 30, 2016 the customer owed the University $99,659. No receivable was recorded,
however, to capture this amount.
Two receipts (4%) totaling $24,659 were not deposited timely as defined by the University’s deposit
policy. The deposits were made one and seven days late.
Nine receipts (18%) totaling $105,790, all of which were vendor refunds, did not have documentation
showing when they were received by the University so we were unable to determine if they were
deposited in accordance with University policy.

We also reviewed all four quarters of the University’s quarterly accounts receivable reporting to the State andnoted the following.
•••

The Quarterly Reporting of Accounts Receivable Activity – Concerning the Collection of Accounts
Over 180 Days Past Due and Accounts Over $15 Thousand (Form C-99A) understated the amountof the receivable balance owed by commercial customers for three of the four quarters (75%).
Quarter one’s amount was understated by $25,000, quarter two by $198,000, and quarter four by$103,000. These differences were amounts received by the University after each quarter’s end but
before the form was prepared.
Six adjustments were made on the Quarterly Summary of Accounts Receivable Activity (Form C-97)
without explanation. The adjustments ranged from $1,000 to $11,000.
The fourth quarter’s Form C-97 understated the number of student loans outstanding by 25.

Procedure 26.20.10 of the Statewide Accounting Management System manual (SAMS) states the University
should record a receivable when the amount due is measurable such as when goods or services have beendelivered.
Northern Illinois University Business Procedure Manual Procedure No. 5-1 states receipts are to be depositeddaily with the Bursar’s Office or an authorized depository bank unless the amount of the receipt is below$500, in which case the receipt must be deposited within 5 business days.
Procedure 26.30.50 of the SAMS manual states form C-99A is to contain the dollar amount of accounts thatare over 180 days past due and greater than $15,000.

23

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-004

Inadequate Control over Cash Receipts and Accounts Receivable
Recording and Reporting Processes (Continued)

Procedure 26.30.20 of the SAMS manual states any adjustments made on form C-97 should be explained in
the explanation/comment section of the form. It also states the number of accounts for each major revenue
source must be reported at the end of the quarter.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that
resources are utilized efficiently, effectively, and in compliance with applicable law; obligations and costs arein compliance with applicable law; funds, property, and other assets and resources are safeguarded against
waste, loss, unauthorized use, and misappropriation; revenues, expenditures, and transfers of assets,
resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState's resources; and funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist.
University officials stated the unrecorded receivable amount was due to oversight and untimely deposits were
due to workload levels. The lack of documentation for the date a receipt was received was due to thedepartment receiving those funds not recording the dates. The understatement of amounts reported on the
C-99A form and the missing adjustment explanations on the C-97 forms were due to a misunderstanding of
how the forms were to be prepared. The understatement of the number of student loans was a typing error.
Not recording receivables and reporting inaccurate receivable numbers to the State can cause a
misstatement in the University’s financial report and hinder useful analysis of receivable balances andcollection periods. The untimely deposit of cash receipts increases the risk of loss and delays the usage ofavailable funds. (Finding Code No. 2016-004)
Recommendation
We recommend that the University strengthen controls over its cash receipts and accounts receivable
processes to ensure that amounts owed to the University are properly recorded and reported and that whenamounts are paid they are promptly deposited.
University Response
The University accepts the Auditor’s recommendation. Management has conducted a comprehensive review
of each component of this finding and is taking the following corrective actions that will eliminate material
exceptions:
1) University will modify procedures to track and report billing through Commercial Receivables toensure these receivables are properly recorded and reported.
2) University will update current quarterly reporting business practices to align with SAMS manual
reporting requirements.

24

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-005

Voucher Processing

Northern Illinois University (University) did not process certain expenditures accurately or in accordance with
its own or State policies.
We tested 215 expenditures for purposes of State Compliance from Contractual Services,Travel, Printing, Commodities, Equipment, Electronic Data Processing, Telecommunications, and Operationof Automotive Equipment and noted the following:
•
•
•
•
•
•
•

Twelve expenditures (6%) were not approved for payment within 30 days. These expenditures wereapproved for payment between 34 and 79 days (4 to 49 days late).
Two expenditures (1%) were for goods or services purchased before authorization for the purchasewas given through a purchase order.
Two expenditures (1%) included sales tax amounting to $17.
Two expenditures (1%) for furniture purchases over $500 were made without filing a new furniture
affidavit.
One expenditure (1%) for $123 included charges for goods or services that were recorded in thewrong fiscal year. The amount attributable to a prior fiscal year was $83.
One expenditure (1%) payment of $206 was not supported by a signed payment authorization.
One expenditure (1%) was charged the incorrect account code.

Additionally, we noted per inquiry of the Director of Procurement Services that during fiscal year 2016, theUniversity began implementing a policy under which expenditures under $100 did not require a purchaseorder. This policy was not reduced to an official written version, but two expenditures (1%) were processed
under the policy.
The State Prompt Payment Act (30 ILCS 540/3-2(1.1) et seq.) requires state agencies to review in a timely
manner each bill or invoice after its receipt.
Northern Illinois University Business Procedure Manual Procedure No. 9-2 states that all purchases must be
made on a purchase order or a P-Card and that the purchase order requires a number of authorizing
signatures based on the dollar value of the purchase.
The State Property Control Act (30 ILCS 605/7a) requires state agencies to file an affidavit prior to thepurchase of any new furniture over $500 specifying the type of new furniture to be bought, the quantity, cost
per item, and total cost. The affidavit must also state why the furniture must be new instead of using surplus
furniture from the Department of Central Management Services surplus inventory.

25

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-005

Voucher Processing (Continued)

The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that: (1)resources are utilized efficiently, effectively, and in compliance with applicable law; (2) obligations and costs
are in compliance with applicable law; (3) funds, property, and other assets and resources are safeguarded
against waste, loss, unauthorized use, and misappropriation; (4) revenues, expenditures, and transfers ofassets, resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState’s resources; and (5) funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist. These controls
would include not paying for unnecessary amounts such as sales tax from which the University is exempt,
recording expenditures in the correct account and fiscal year, and ensuring that all vendor invoices areaccurate prior to issuing payment.
University officials stated the noted invoices were not approved within 30 days by the approving departments
due to organizational change and employee turnover. Also, University policy is to reimburse sales tax paidby employees if the amount of the purchase is less than $100 and University practice regarding new furniture
affidavits is to call the Department of Central Management Services, which was done but the University neverreceived a response on the two noted purchases. For other minor invoice issues noted, current University
procedures were not followed by the approving departments.
Late approval of invoices, lack of required approvals, and paying for unnecessary expenditures could result ina loss of State funds. Recording expenditures in the incorrect fiscal year or account results in inaccurate
financial statements. (Finding Code No. 2016-005, 2015-008, 2014-007)
Recommendation
We recommend the University improve controls to ensure expenditures are approved timely, are posted tothe correct fiscal year, and vouchers are properly prepared and comply with State law.
University Response
The University accepts the Auditor’s recommendation. Management has conducted a comprehensive
review of each component of this finding and will continue to engage campus departments with appropriate
training on payment policies and proper year-end cut off procedures. University will work to leveragetechnology that will eliminate inefficiencies and streamline payment processes to ensure timeliness of vendor
payments.

26

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-006

Noncompliance with the Board of Higher Education Act

The University did not comply with the requirements of the Board of Higher Education Act (Act).
The University did not submit the required separate, monthly report for July 2015 to the Department of
Human Rights or the Attorney General for adjudicated cases in which there was a finding of racial, ethnic, or
religious intimidation or sexual harassment. These cases were reported later in a four month report that was
filed with the Department of Human Rights and the Attorney General in October 2015. Additionally, theUniversity did not have a general educational requirement in place during the 2015-2016 school year thatcalled for students to complete coursework on improving human relations before obtaining a degree.
The Act (110 ILCS 205/9.21) required the University to report monthly [until August 21, 2015 at which point
the requirement was changed to annually] to the Department of Human Rights and the Attorney General oneach adjudicated case in which a finding of racial, ethnic, or religious intimidation or sexual harassment ismade in a grievance, affirmative action or other proceeding established by the University to investigate anddetermine allegations of racial, ethnic or religious intimidation and sexual harassment.
The Act also requires the University to include, in the general education requirements for obtaining a degree,
coursework on improving human relations to include race, ethnicity, gender and other issues related to
improving human relations to address racism and sexual harassment on its campuses, through existingcourses.
University officials stated the issues noted occurred due to staff turnover and staffing constraints.
Failure to submit required reports and include a human relations general educational requirement in the
University’s graduation requirements constitutes noncompliance with the Act. (Finding Code No. 2016-006)
Recommendation
We recommend the University implement controls to ensure reports are filed as required by the Act andupdate its graduation requirements to include the required coursework on improving human relations.
University Response
The University accepts the Auditor’s recommendation. Management has conducted a comprehensive review
of each component of this finding and has begun to modify procedures to ensure that annual reports areprepared and completed on an annual basis. In addition, corrective action has been initiated to implement a
general education requirement in compliance with the Act.

27

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-007

Noncompliance with the Illinois Pension CodeNorthern Illinois University (University) did not fully comply with the provisions of the Illinois Pension Code.
The University is a participant of the State University Retirement System (System). As a participant in the
System, the University is not responsible for making employer contributions as they are paid on its behalf by
the State of Illinois unless an employee is paid with trust or federal funds. However, when an employee ispaid with trust or federal funds, the normal pension benefit cost of that employee is paid with those funds andthe University is responsible for remitting the contributions to the System. During our testing, we noted the
University did not remit $29,686 of these contributions to the System.
The Pension Code (Code) (40 ILCS 5/15-155(b)) requires when an employee is paid from trust or grant funds
that the University pay contributions to the System from those same funds sufficient to cover the accruing
normal costs of the employee.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that
resources are utilized efficiently, effectively, and in compliance with applicable law; obligations and costs arein compliance with applicable law; funds, property, and other assets and resources are safeguarded against
waste, loss, unauthorized use, and misappropriation; revenues, expenditures, and transfers of assets,
resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState's resources; and funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist. These controls
should ensure all contributions due to the System are remitted.
University officials stated the delay in payment remission to the System was caused by staff turnover, manual
processes, and undocumented procedures. Employees’ wages were charged to grants through manualadjustments throughout fiscal year 2016 when it was determined that the employees were working on grantactivities. Due to staff turnover these adjustments were not provided timely to the department responsible forsubmitting the contributions to the System.
Noncompliance with the Code results in reduced contributions to the System and may result in decreased
earnings potential for the System. (Finding Code No. 2016-007)
Recommendation
We recommend the University implement procedures to ensure amounts payable to the System are properly
tracked and remitted to the System.
University Response
The University accepts the Auditor’s recommendation. The University has begun to implement corrective
actions to modify business procedures and leverage technology to ensure State University Retirement
System contributions are submitted timely.

28

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-008

Noncompliance with the Freedom of Information and State Records
Retention Acts

Northern Illinois University (University) did not fully respond to Freedom of Information Act requests and did
not retain documents in accordance with the Records Retention Act and its own policies.
We selected a sample of 25 responses to Freedom of Information Act requests to review the completeness of
the University’s responses and noted the following.
•

3 responses (12%) did not include all the information requested. The University did not inform therequestor the information was not included in the response or provide a reason as to why it was notincluded. One of the requestors noted that information was missing and informed the University ofthe oversight. The missing information was provided 5 business days after it was due based on theoriginal request.

•

1 response (4%) to a request for a listing of all e-mails written and received by an employee in the
Administration and Finance office for a period of four months contained 351 e-mails or approximately
3 a day. The requestor questioned the completeness of the list and was informed the University had
provided all the information it had and if the employee had deleted any e-mails during the requested
timeframe it was too late to recover them. The e-mails requested would have been approximately
two years old at the time of the request.

The Freedom of Information Act (5 ILCS 140/1 and 140/3) states that all persons are entitled to full andcomplete information regarding the affairs of government and the official acts and policies of those who
represent them as public officials and public employees. It also states the University should promptly comply
with a request for public records within 5 business days of receiving the request.
The State Records Act (5 ILCS 160/2) states that records includes all electronic material made or received byany agency in the State in connection with the pursuance of state law, transaction of public business, orappropriate for preservation as evidence of the organization, function, policies, decisions, procedures,operations, or other activities of the State.
The State Records Act (5 ILCS 160/17) states that no record shall be disposed of by any agency of the State,
unless approval of the State Records Commission is first obtained.
Northern Illinois University’s Record Retention and Administrative Guidelines states that a record includes
business emails and general correspondence emails if they have any bearing on actions taken or not taken. It
also states if a record is not included in a department’s record retention schedule it cannot be destroyed. If it
is included, the record may be destroyed in accordance with the timeframe in the schedule and after approvalhas been obtained from the State.
The retention schedule for the University’s Office of Finance and Planning states correspondence must be
retained for 3 years prior to being transferred to the University’s Archives for either permanent retention or
disposal.

29

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-008

Noncompliance with the Freedom of Information and the State Records Acts
(Continued)

University officials stated information missing from responses was due to the significant volume of requests
received and the short timeframe in which responses were due. The non-retention of e-mails was possibly
due to a former University employee not understanding document retention requirements combined with the
University’s migration to a new e-mail system.
Not supplying complete responses to Freedom of Information Act requests and the failure to properly retain
records results in noncompliance with State law and decreases the University’s transparency. (Finding CodeNo. 2016-008)
Recommendation
We recommend the University strengthen controls over its process of providing responses to Freedom ofInformation Act requests and implement controls to ensure its employees are aware of document retention
policies and procedures.
University Response
The University accepts the Auditor’s recommendation. The University has dedicated a full-time employee tomanage the FOIA response process. The University has leveraged technology to better track and organize
all FOIA documents, communications and responses, and to ensure employee emails are retained inaccordance with the Records Retention Act

30

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-009

Failure to Submit Proper Time Reporting

The University did not require all employees to submit time sheets as required by the State Officials andEmployees Ethics Act.
We noted that the University had not fully implemented the requirement to collect data from all employees tobe in compliance with the Act. Out of the 25 employees selected for testing, 5 employees did not submit time
sheets listing the number of hours worked for the period tested.
The State Officials and Employees Ethics Act (Act) (5 ILCS 430) requires the University to adopt personnel
policies consistent with the Act. The Act (5 ILCS 430/5-5(c)) further states, “The policies shall require State
employees to periodically submit time sheets documenting the time spent each day on official State businessto the nearest quarter hour.”
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that
resources are utilized efficiently, effectively, and in compliance with applicable law; obligations and costs arein compliance with applicable law; funds, property, and other assets and resources are safeguarded against
waste, loss, unauthorized use, and misappropriation; revenues, expenditures, and transfers of assets,
resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState's resources; and funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist.
University officials stated that the University has a process in place to track time reporting. Although faculty
currently report their time commitment for instructional activities, service work, and time and effort on federal
grants, discussions continue for implementing faculty time reporting that complies with this mandate.
By not requiring appropriate time sheets from all of its employees, the University lacks complete
documentation of the time spent by faculty and staff on official state business as contemplated by the Act.
(Finding Code No. 2016-009, 2015-004, 2014-003, 2013-004, 12-6, 11-3, 10-1, 09-4, 08-4, 07-7, 06-4, 05-6)

Recommendation
We recommend the University continue its efforts to develop and implement a program to require all
employees to submit time sheets in accordance with the Act.
University Response
The University accepts the Auditor’s recommendation. The University has instituted a process that captures
time worked and benefit usage for Non-Faculty and Civil Service employees. The University is exploringalternative strategies that embrace the unique complexities of reporting time worked by faculty.

31

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-010

Procurement Card Use

Northern Illinois University (University) has not established adequate internal controls over procurement card
(P-card) transactions.
The University operates a procurement card program that allows individuals throughout the University tomake smaller purchases (defined as less than $5,000) on a credit card, which is directly paid by the
University on a monthly basis. The University’s policies require employees assigned a procurement card tocomplete training on policies and procedures and to sign an agreement stipulating that they will use the cardin accordance with the University’s policies. The University’s procedures also require all purchases on thecards be reviewed by the employee’s manager and that receipts or other documentation of the purchases on
the card be given to the manager for review and that these documents be maintained.
We tested the purchases made by 25 individuals during 4 months of the fiscal year (95 purchase logs
detailing 1,723 transactions totaling $578,688) and noted the following:
•
•
•
•
•

Twelve transactions (1%) totaling $7,246 included the payment of sales tax ($545) which is aprohibited charge as the University is tax-exempt.
Nine procurement card logs (1%) contained paid sales tax errors that should have been
detected and corrected during review.
Nineteen transactions (1%) totaling $9,167 were not allocated to the correct expense
account.
Three transactions (1%) totaling $2,969 did not have supporting receipts.
One employee exceeded the $10,000 monthly limit on her procurement card. No
documentation of the approval for the exceeded limit was provided.

The University had approximately 529 procurement cards active during the fiscal year and incurred$6,786,394 of expenditures during the year ended June 30, 2016.
Per section 4.1 Card Holders are Required To of the Manual, the card holder is responsible for ensuring notaxes are charged to the card, and for obtaining a refund if sales tax is charged. Additionally, per section 4.1,
the card holder must retain receipts and backup documentation for all transactions of any amount.
Per section 4.1.1 Approving Managers are Required To of the Manual, the approving manager must monitor
the use of the procurement card to ensure compliance with the University’s policies and approve alltransactions and monthly statements in a timely manner.
Per section 3.5 Credit Limits of the Manual, Individual procurement card credit limits will default to $5,000 pertransaction and $10,000 per month. Card holders may request approval from the Approving Manager toincrease credit limits in order to allow a one‐time, specific transaction that will be higher than the transaction
and/or monthly limit.

32

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-010

Procurement Card Use (Continued)

The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance that: (1)resources are utilized efficiently, effectively, and in compliance with applicable law; (2) obligations and costs
are in compliance with applicable law; (3) funds, property, and other assets and resources are safeguarded
against waste, loss, unauthorized use, and misappropriation; (4) revenues, expenditures, and transfers ofassets, resources, or funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain accountability over theState's resources; and (5) funds held outside the State Treasury are managed, used, and obtained in strict
accordance with the terms of their enabling authorities and that no unauthorized funds exist.
University officials stated that although the University has appropriate policies in place which stipulate
procurement card holders are not to pay sales tax, retain receipts of all transactions, and correctly allocate
expenses to the proper account, there were several instances in which the cardholders associated with the
exceptions did not follow University policies and procedures. Additionally, management stated that althougha procurement card security feature will not allow a cardholder to exceed their approved monthly limit, theone instance where monthly transactions exceeded the documented monthly limit was due to insufficient
documentation of the approved monthly limit increase.
Paying for sales tax is an unnecessary use of the University’s limited resources. Not allocating charges to thecorrect accounts may result in the University’s financials being misstated. Additionally, not performing
thorough reviews of the purchasing logs and not retaining documentation of approved purchase limits canresult in inappropriate charges not being detected. (Finding Code No. 2016-010, 2015-009, 2014-009)
Recommendation
We recommend that the University review its current process for reviewing and approving procurement cardtransactions and consider any changes necessary to ensure charges are made in accordance with the
University’s policies and procedures.
University Response
The University accepts the Auditor’s recommendation. Management has conducted a comprehensive review
of each component of this finding and is taking the following corrective actions that will eliminate material
exceptions:
1)
2)
3)
4)

Provide ongoing training with cardholders
Enhance communications on policies and procedures
Provide additional review and oversight of cardholders’ purchase documentation
Finalize staffing and training of new P-card Administrator

33

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-011

Inadequate Controls over Property and Equipment

Northern Illinois University (University) did not fully comply with requirements applicable to its property andequipment.
We reviewed the University’s property inventory certification as of November 30, 2015 that was submitted to
the Department of Central Management Services (DCMS). The inventory certification to DCMS reported 315
items ($356,432) of equipment that could not be located by the University. These assets were acquired by
the University during the current as well as past fiscal years. Included in this listing were approximately 107
computers, servers, CPUs, or other electronic storage devices.
Additionally, we tested the final amended versions of the Agency Report of State Property (C-15) reports the
University filed for all four quarters of fiscal year 2016 and noted several errors. In the University’s quarter
two filing, the amount of equipment additions were understated by $4,003,750 to correct a prior period errorthat overstated the beginning balance of equipment. Then, in the University’s quarter three filing, deletions
from construction in progress were overstated by $108,044 when an amount was removed twice in error.
This error was not corrected which resulted in a $108,044 understatement of the University’s reported ending
construction in progress amount for both quarters three and four.
The State Property Control Act (30 ILCS 605/4) requires responsible officers at each State agency to beaccountable for supervision, control and inventory of property under their jurisdiction to ensure properaccounting and safeguarding of assets.
The State Comptroller Act (15 ILCS 405/17) requires the University to report to the Comptroller of the State of
Illinois (Comptroller), on forms prescribed by the Comptroller, all property acquired or disposed of by the
University in such detail and at such times as the Comptroller requires in order to allow the Comptroller tomaintain a current inventory record of all property held by or on behalf of the State or any State agency.
Statewide Accounting Management System (SAMS) Procedure 01.10.50 states that Agency heads have theoverall responsibility to see that the fiscal management programs and procedures prescribed by theComptroller are carried out.
SAMS Procedure 29.20.10 requires the University to report all additions in each asset category that occurred
during the quarter being reported and to report in the deletions column corrections of prior year errors. It also
requires the University to include a footnote for all corrections made.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance thatrevenues, expenditures, and transfers of assets, resources, or funds applicable to operations are properly
recorded and accounted for to permit the preparation of accounts and reliable financial and statistical reports
and to maintain accountability over the State's resources.
University officials stated controls are in place over equipment; however, due to the number of assets held by
the University and the movable nature of the items discrepancies occur. Errors in the C-15 reports were due
to manual processes that are prone to human error.

34

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-011

Inadequate Controls over Property and Equipment (Continued)

Inadequate controls over property and equipment can lead to the University misreporting the assets it actuallyowns and impact the University’s financial statements. It can also increase the risk that property andequipment will be misplaced or stolen. (Finding Code No. 2016-011, 2015-010)
Recommendation
We recommend the University strengthen its internal controls over the accountability and reporting of
University property.
University Response
The University accepts the Auditor’s recommendation. The University will continue to review and amend its
processes to strengthen control over University assets. The University will work to leverage technology andretrain staff to ensure accurate recording of assets and reporting of the C-15 report.

35

State of Illinois
Northern Illinois University
Schedule of Findings and Questioned Costs (Continued)
Current Findings – State Compliance
For the Year Ended June 30, 2016

Schedule of Findings (Continued)
Finding 2016-012

Noncompliance with the Higher Education Veterans Service Act

Northern Illinois University (University) did not fully comply with the Higher Education Veterans Service (Act)Act.
The Higher Education Veterans Service Act (110 ILCS 49/20) states that by September 1st of each fiscal year
the University is to report to the Illinois Board of Higher Education the fiscal impact of services and programs
offered to veterans related to requirements of the Act for the prior fiscal year.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires the University to establish andmaintain a system, or systems, of internal fiscal and administrative controls, to provide assurance thatrevenues, expenditures, and transfers of assets, resources, or funds applicable to operations are properly
recorded and accounted for to permit the preparation of accounts and reliable financial and statistical reports
and to maintain accountability over the State's resources. These controls should ensure that required reports
are submitted to State agencies.
University officials stated the underlying cause for the untimely filing of the 2015 academic year report wasdue to staff turnover. No director or certifying official was in place at the time the report was due. The current
director became aware of the reporting requirement in August of 2016 and took immediate action to comply.
Failure to report the fiscal impact of programs and services offered to veterans results in noncompliance with
the Act. (Finding Code No. 2016-012)
Recommendation
We recommend the University submit the fiscal impact report to the Illinois Board of Higher Education incompliance with the Act.
University Response
The University accepts the Auditor’s recommendation. The University has taken corrective action to train
additional staff members in completing the survey to ensure compliance.

36

State of Illinois
Northern Illinois University
Prior Findings Not Repeated
For the Year Ended June 30, 2016

A. Finding: Untimely After-the-Fact Verification of Time and Effort
In the prior examination, the University did not verify the allocation of payroll and benefits charged to federal
grants was accurate in a timely manner.
Disposition
In the current year, our sample testing of payroll expenditures for federal grants indicated they were
supported by time and effort reports which were completed in a timely manner as defined by University
policy. (Finding Code No. 2015-002)
B. Finding: Inadequate Documentation for Federal Program Expenditures
In the prior examination, the University did not have supporting documentation for some of the expenditurescharged to the Professional and Cultural Exchange Programs – Citizen Exchanges program (CFDA 19.415).
(Finding Code No. 2015-003)
Disposition
In the current year, our expenditure samples from the Professional and Cultural Exchange Programs –Citizen Exchanges program (CFDA 19.415) indicated supporting documentation was present.
C. Finding: Incomplete TA-2 Forms
In the prior examination, the University submitted incomplete TA-2 forms to the Legislative Audit Commission(Commission) and had not yet recouped an improper fiscal year 2014 disbursement to an employee for
unreimbursable travel expenses. (Finding Code Nos. 2015-006, 2014-005)
Disposition
In the current year, our sample of TA-2 forms selected for testing indicated they were complete and filed with
the Legislative Audit Commission. Further, the improper disbursement was recouped by the University.
D. Finding: Failure to Comply with the University Faculty Research and Consulting Act
In the prior examination, faculty members of the University performed outside consulting work without firstobtaining prior approval from the University.
Disposition
In the current year, our sample of faculty members performing outside consulting work obtained priorapproval from the University to perform the work. (Finding Code No. 2015-007, 2014-008)

37

State of Illinois
Northern Illinois University
Summary of Prior Year Government Auditing Standards and Federal Compliance Findings
For the Year Ended June 30, 2016
Finding 2015-001

Financial Reporting Process

Condition: The University’s internal controls over financial reporting are not sufficient to prevent
misstatements. During our review of the draft financial statements provided by the University, several errors
and deficiencies were identified.
Corrective Action Plan: Management has conducted a process review of each component of this finding
and has implemented corrective actions that include the following:1) Expand training for staff accountants on accounting guidelines, standards and reconciliation
procedures.
2) Expand use of technology and systems to automate manual processes.
3) Update and refine policies and procedures for departments that provide data feeds to theaccounting function.
Current Status: This finding is repeated as 2016-001.
Finding 2015-002

Untimely After-the-Fact Verification of Time and Effort.

Federal Programs Impacted: All programs to which payroll and benefit expenses are allocated.
Condition: The University did not verify the allocation of payroll and benefits charged to federal grants was
accurate in a timely manner.
Corrective Action Plan: The University will review its current process for managing time and effort reports
and will implement a system of distributing them in a more timely fashion.
Current Status: Corrective action plan is complete.
Finding 2015-003

Inadequate Documentation for Federal Program Expenditures

Federal Department: Department of State
CFDA Number: 19.415
Program Name: Professional and Cultural Exchange Programs – Citizen Exchanges
Condition: The University did not have supporting documentation for certain expenditures charged toFederal programs.
Corrective Action Plan: The University will remove the charges from the grant award in question totalingof $248 of unsupported documentation, as well as the overcharge of $90 for retirement expense. The
University will review its procedures to strengthen controls to ensure grant charges are supported withproper documentation.
Current Status: Corrective action plan is complete.

38

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients* STUDENT FINANCIAL ASSISTANCE CLUSTERDEPARTMENT OF EDUCATION
Federal Supplemental Educational Opportunity Grants G7B70075
Federal Work-Study Program G7B70238
Federal Pell Grant Program G7B70076
Federal Perkins Loan Program, Beginning Loan BalanceFederal Perkins Loan Program, New Loans
Federal Perkins Loan Program, Administrative Cost Allowance
Federal Direct Loans Program G7B70071
Teacher Education Assistance for College and Higher Education Grants(TEACH) G7B70077
Total Student Financial Assistance Cluster

84.00784.03384.06384.03884.03884.03884.268P007A111243
P033A111243
P063P111370

836,864
874,070
29,284,022
8,399,212
993,208
158,945
122,984,312-

84.379

P379T121370

89,146
163,619,779-

77,27522,494102,188
201,957--

RESEARCH AND DEVELOPMENT CLUSTERNATIONAL SCIENCE FOUNDATION
Engineering Grants:
CAREER: Advanced Photochemical Paradigms for Enhanced Photovoltaics andPhotocatalysis and Photocatalysis G1A62475
I-Corps L: Tinkering Labs G1A62565
Wireless Communication Integrated Active Noise Reduction System G6A64172

47.04147.04147.041Mathematical and Physical Sciences:
Application of Statistics in Assessing Nanoreliability G1A62493
Synthetic Methodologies Utilizing Superelectrophiles G1A62523
Unconventional Electrodynamics in Unconventional Solids G1A62530

1505499-47.04947.04947.049DMS-1208273
CHE-1300878
DMR-1310199

29,74081,524
97,711-

DMS-1322127

41,132-

Colloborative Research: ATD: Dynamical Sampling and Resconstruction for Sensing Networks G1A62531

47.049Phenomenology of electroweak Symmetry Breaking, Supersymmetry, and the Frontiers of theStandard Model G1A62548

47.04955,782-Creation and Crystallinity Control of Artificail Ices Using Superconducting Vortices G1A62551
Searching for New Phenomena with Leptons G1A62576

47.04947.04995,184
202,722-

Using the Higgs boson to probe and test the Standard Model at ATLAS G1A62582
Development of Ultra-cold Quantum-degenerate Relativistic Electron Beams for Research and Applications G1A62586

47.04947.04961,871
97,619-Search for New Phenomena at the Energy Frontier G1A62587
Passed-Through Columbia University:

47.04924,641--US ATLAS Operations: Empowering us Universities for Discoveries at theEnergy Frontier G6A64044
Passed-Through University of Chicago
Development of Ultrafast Tracking Electronics for the ATLAS Trigger G6A64070
Passed-Through University of Notre Dame
The Quarknet Project G6A64208

Geosciences:
Catalyzing Early Career partnerships to Promote Discipline-Based Education
Research in the Geosciences G1B66767
Collaborative Research: Developing new Science and Technology for Subglacial Studies of the Willins Ice Plain

47.0495-25191 PO G03010

145,86747.049

FP048009-C

31,261-47.049

PHY-1219444

7,335
972,389-1425927

1,177-

1347782

1,890
56,500-47.050and West Antarctic Ice Sheet G1A62532
Copper & Gold in Sulfur-rich Magmatic-hydrothermal Systems G1A62552

47.05047.050-

Holecene Precipitation Changes G1A62581
Diatom and Oxygen Isotope Evidence of Pliocene Antarctic Ice Sheet Dynamics and Ross Sea Paleoceanography

47.0501502989

19,176-

G1A62584
Passed-Through Columbia University
IODP Expedition 361 South African Climates: microfossils G6A64204

47.0501443420

16,841

1,711

47.05014502816,016111,600

1,711

Computers and Information Science and Engineering:
HCC: Collaborative Research: Integrating Cognitive and Computational
Models of Narrative G1A62525
CC-NIE Integration: Collaborative Research: EPSON: Embracing Parallel
Networks and Storage for Predictable End-to-End Data Movement G1A62561

Biological Sciences:
Subgenomic RNAs in Genetic Reco G1A62366
CAREER: Library Based Design of Linked Equilibria to Control Protein Interactions G1A62395
Dimensions NASA: Collaborative Research: The Biogeography and Draught
Tolerance in Grasses G1A62529
Collaborative Research: Ecological Diversification and molecular
Evolution of Grasses (Poaceae) G1A62459

Social, Behavioral, and Economic Sciences:
Collaborative Research: Cultural Models of Nature Across Cultures: Space, Causality,
and Primary Food Producers G1A62528
CAREER: Exit Strategies: Assessing Long-Term Social, Cultural, and Political Impacts of the
Depart of INGOs in Rural Haiti G1A62571

47.0701319974

66,751-47.0701440797

171,087
237,838-

47.07447.074

MCB-0920617
MCB-0953323

1,471
88,416-47.074

DEB-1342782

21,502-47.074

DEB-1120761

2,635
114,024-

40,88016,9971455142

89,155130,035

26,832
43,82947.07547.07539

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

NATIONAL SCIENCE FOUNDATION (Continued)
Education and Human Resources:
IMUSLE-Incremental Mindset and Utility for Science Learning andEngagement G1A62460
PROMISE: Providing Resources and Opportunities to Maximize Interest
in STEM Education G1B66748
Renewable Energy Technology Across the Engineering Technology Curriculum G1A62480
Empowering Teachers to Enhance Adolescents' Motivation for Science G1A62481
Internet Acessible Remote Laboratories with Collaborative Design G1A62490
Collaborative Research: WILSIM2, The Next Generation Landform Simulator G1A62492
Doctoral Dissertation Research: The Effects of Honeysuckle Encroachment on White Oak
Savannas in Relation to Understory light, soil and Dispersal G1A62499
Fellowship for Christopher Budnick G1A62516
Collaborative Research: The Geo-CC&CP Foundry - Building Institutional Capacity for
Broadening Participation in the Geoscience Workforce G1A62557

47.0761136143

64,356-47.07647.07647.07647.07647.076

DUE-1068463
1140447
11029251140502
1140375

351,71031,08822,62451,91463,531

16,60513,80047.076

None

706

-

47.076

Fellowship

42,666-47.0761445228

123,724-

Collaborative Research: Learning & Teaching Engineering Dynamics Through Interactive
Simulations G1A62558
Passed-Through University of Missouri on behalf of Missouri University of Science andTechnology Engineering Uncertainity Repository G6A64098
Passed-Through American Institutes for Research
STEM I.E. (Interest and Engagement) G6A64155

47.0761432289

54,78047.0761245070

19,753-60,829887,681

28,14758,55247.076

Trans-NSF Recovery Act Research Support:
RAGES-Collaborative Research: Integrative Study of Marine Ice Sheet
Stability and Subglacial Life Habitats-Robotic Access to Grounding
Zones - ARRA G1A62368
LISSARD-Collaborative Research: Integrative Study of Marine Ice
Sheet Stability and Subglacial Life Habitats-Lake & Ice Stream
Subglacial Access- ARRA G1A62369
Searches for New Phenomena with High Energy Particle Colliders G1A62483
Total NSF Recovery Act Research Support

47.082

ANT-0839107

112,145

20,91247.08247.082

ANT-0839059
PHY-1206092

65,166
221,851
399,162

30,6003,054,686

134,692

44,82344,823

12,34912,34925,612314
314

Total National Science Foundation
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Maternal and Child Health Federal Consolidated Programs:
MCH Research G1A62590

93.110

9,688-

Research Related to Deafness and Communication Disorders:
Processing of Spoken Language in Young Children who use cochlear
Implants G1A62450

93.173

1R15DC011605-01

25,612
Research on Healthcare Costs, Quality and Outcomes:
Passed-Through Northwestern University
Healthcare Research and Quality/DHHS G6A64178

93.226

Mental Health Research Grants:
Biomarkers for Posttraumatic Stress in Women Following a Campus Mass Shooting G1A62501
Automatic 3D Quantification of Synapse Distribution in Complex Dendritic Arbor G1A62527

93.24293.242

1 R18 HS023921 - 01

1 R15MH099521-01
1R15MH099569-01A1

314,373
314,373-

53,071
137,767
190,838

64,931

10,224
43,81554,039-145,525
145,525

30,61530,615-64,931

Occupational Safety and Health Program
Randomized Controlled Trial of Whole Body Vibration Intervention in Truck Drivers G6A64176
Multi-tasking to Hyper-tasking: Investigating the Impact of the Next Generation 911 G6A64182

93.26293.262-

Minority Health and Health Disparities ResearchE-diaries to assess health effects of microaggressions G1A62575

93.307

Cancer Cause and Prevention Research:
Lung Cancer Recurrence and Survival: Statistical Methods and Models
for Ethnic and Gender Disparities, Epigenetics and related Issues G1A62442

93.393

1R15CA152896-01A1

118,977
118,977-

Cancer Treatment Research:
Targeting the tumor microenvironment in B-Cell malignancies G1A62542

93.395

IR03CA175872-01A1

42,79942,799-

ACA-Transforming Clinical Practice Initiative: Practice Transformation Networks (PTNs)
Great Lakes Practice Transformation Network G6A64202

93.638130,699
130,699-

Cardiovascular Diseases Research:
Mechanisms of Social Isolation and Environmental Enrichment in an Animal
Model G1A62491

93.837

1R15EY020995-01

109,380
109,380-

93.85593.855

2R15AI081232-02
1R15I113653-01(752)
139,036

21,703

6,510
144,794

21,703Allergy, Immunology and Transplantation Research:
Role of VeA-Dependent Genes and Proteins in Mycotoxin Production and Development
G1A62479
Design and Study of IspF Inhibitors as Antibacterial Agents G1A62550
Pass-Through Seattle Biomedical Research, Inc.
Rickettsia Met AP functional study G6A64148

93.85540--

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

DEPARTMENT OF HEALTH AND HUMAN SERVICES (Continued)
Allergy, Immunology and Transplantation Research (Continued):Orphan genes in pathogenic bacteria

G1A62570

93.859162,003-

162,003-Child Health and Human Development Extramural Research:
Reactions to Prolonged Infant Crying in Parents at Risk for Child Physical Abuse G1A62583
Passed-Through Global Obesity Prevention Center
Assessing the impact of zoning policies on fast-foods around schools G6A64228

93.865

146,717-93.865

5,864
152,581-

1,636,443

129,912

Total Department of Health and Human Services
DEPARTMENT OF EDUCATION
Office of Special Education and Rehabilitative Services:
Peer Health Navigation for Medicaid Beneficiaries with Physical Disabilities: A Community-Based
Participatory Research Intervention Development Study G4A63067

84.133

Education Research, Development and Dissemination:
Testing the onPAR Model in Developmental Literacy Education G1A62574
Passed-Through University of Kansas:
Development and Validation of Online Adaptive Reading Motivation Measures G6A64017
Passed-Through University of Illinois at Chicago:
Reading for Understanding Across Grades 6-12: Evidence -based
Argumentation for Disciplinary learning G4A63051

30,94330,943

94,30184.305

R305A150193

395,675

84.305FY2011-103

24,16584.305

2010-01569-01-00

333,869
753,709147,255-

52,954

Statewide Longitudinal Data Systems:
Passed-Through University of Minnesota
Chicago Longitudinal Survey G6A64171

84.372

18,394-Passed-Through Illinois State Board of Education
41-FN17260

84.372340,000
358,394-

1,143,046

147,255

16,043
16,043-65,20065,200-67,688
184,440
252,128-

333,371-

Total Department of Education
DEPARTMENT OF AGRICULTURE
Agricultural Research-Basic and Applied Research:
USDA Indentification of Regulatory Genes in A. Flavus and A. Nidulans that are involved in Mycotoxin Product
G2A62555

10.00158-6435-9-386-

Farmers' Market and Local Food Promotion Program:
USDA Farmers to Markets to Consumers: Removing the Obstacles to Growth G2A62567

10.168Grants for Agricultural Research, Special Research Grants:
Passed-Through Kansas State University:
KSU/Air force Family Advocacy Research Analysis and Support Project FASOR G6A64037
Intimate Partner Risk Assessment Quality Assurance Project G6A64159

10.20010.2002015-39575-24367
S15042

Total Department of Agriculture-

DEPARTMENT OF COMMERCE
National Institute of Standards and Technology:
Measurement and Engineering Research and Standards
Dev/Val of Physics Based AM Models for Process Control & Quality Assurance G2A62519
Passed-Through the Northwestern University
Development of Roadmap & Consortium for Innovation in Sheet Metal
Forming G6A64149

11.60970NANB13H194

752,816

438,277

11.609SP0026516-PROJ0007766

11,336764,152

438,277-

Manufacturing Extension Partnership:
Pass-Through Illinois Manufacturing Extension Center
Training Module Dev to Exploit the Synergy between Lean Manufacturing &Green Supply Chain Practices G6A64119
Regional Host Organization for Illinois Manufacturing Excellence Center G6A64144

11.611
11.611

391,846
651,4311,043,277-

Science, Technology, Business and/or Education Outreach
NIST Summer Undergraduate Research Fellowship G2A62600

11.620

3,465
3,465

-

Total Department of Commerce

1,810,894

41

438,277

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
Number

DEPARTMENT OF DEFENSEUS Army Research Institute (ARI) for the Behavioral and Social Sciences
Specification of Effective Monitoring Behaviors for Leadership Competency Development
and Adaptability G2A62503
Passed-Through Kansas State University
Illinois Center for Defense Manufacturing (ICDM) G6A64109

Federal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

12.000AFS-ALCS2010-7

23,690-12.000

S1403650,00073,690-73,690

-

4,551
4,551

-

275

-

275

-

44,51444,514-49,340-101,742
12,269114,011-

114,011-

Total Department of Defense-

DEPARTMENT OF INTERIORFish and Wildlife Management Assistance:
Assessing Management Needs to Enhance the Recovery for the
Eastern Mississauga G2A62410/G2A62538

15.608F13AC00624

Great Lakes Restoration:
Annual Lake Erie Watersnake Census (LEWS) G2A62495

15.662F12AP00909

U.S. Geological Survey Research and Data Collection:
Seismic Monitoring of the Asian Carp Water Gun Deployment in the Chicago Area Waterway
System, the Illinois River, and Other Systems. G2A62554

15.808G14AC00279

Total Department of Interior
US OFFICE OF PERSONNEL MANAGEMENTIntergovernmental Personnel Act Mobility Program:
US Army Medical Command IPA
Joint Appt. G2A62549
Hines VA Hospital - Veterans Affairs G2A62566

27.01127.011

Total US Office of Personnel Management
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
Science
Estimating Global Volume of Excavation by Fluvial Processes on Mars: Inferring Volumne of Water
and its Implications G2A62517
Passed-Through University of Nevada, Las Vegas
Exploration of Biological Dark Matter in Geothermal Springs G6A64069

43.001

NNX13AK65G

85,036-43.00113-725F-03

30,750115,786-

115,786

-

4,200
4,200

-

4,200

-

Total National Aeronautics and Space Administration
NATIONAL ENDOWMENT FOR THE HUMANITIES
Promotion of the Humanities_Fellowships and Stipends
The Humanitarian Eye: Photography and the 20th-Century Quest to Save Innocents
Abroad G2A62541

45.160Total Department of National Endowment for the Humanities

42-

FA-57772-14-

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
Number

DEPARTMENT OF ENERGY
Office of Science Financial Assistance Program:
Polarized X-Rays as a Probe of Spin Polarization G2A62156
Studies of Conventional & ERL-Based Recirculator Electron Cooling for an Electron
Ion G2A62502
Searching for Physics Beyond the Standard Model at the Intensity Frontier G2A62543
Nonlinear Dynamics & Phase Space Manipulations of High-Brightness Beams G2A62547
eSHIVA in IOTA: Experiment on Stochasticity in high intensity G2A62599
Passed-Through the Kansas State University
Nano-patterned cathode surfaces for high efficiency photoinjectors G6A64156
PasG6A64179

Federal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

81.049DE-FG02-03ER46097

98,030-81.04981.04981.04981.049DE-SC0008588
DE-SC0012231
DE-SC0011831

41,777125,965
80,2242,549-

81.04981.049DE-SC0009656 2NPC
DE-SC0013162

24,87042,308-415,723

-

2,373
2,373

-

Fossil Energy Research and Development:
Assessing the Geomechanical Response of CO2 Disposal in Flood Basalt Reservoirs
G2A62559

81.089Department of Energy Managed Labs:
Geospatial Infrastructure Tech G2A62384
Development of the MUZE Preliminary Design G2A62494
G-2 Tracking Detector G2A62496
System Software Integration and Development G2A62511
Single Crystal Diffuse Xray & Neutron Scattering Experiments G2A62515
Phase 1 Upgrade: ATLAS - L1calo G2A62537
Community Dashboard Development G2A62540
Study of Ceramic Ion Conductors G2A62556
Searching for New Physics w/ Higgs Bosons at ATLAS G2A62560
Synthesis and characterization of Fe-based pnictide superconductors G2A62563
Materials Development for Energy Efficiency and Renewable Energy Applications G2A62564
Fabrication and Characterization of Superconducting Nanostructures G2A62572
DOE Optical Stochastic Cooling G2A62573
Support for visitng Prof. Lesovik to facilitate creation of theoretical platform for an efficient cooper pair splitter G2A62577
Argonne Split and Delay Monochromator G2A62578
Argonne Atomic scale Surface Structure G2A62579
Summer Support for Andrew Green G2A62580
Argonne Adaptive QoS for Wide-area Data Flows G2A62585
Formation, Manipulations and Applications of Flat and Magnetized Beams at the FAST Facility G2A62589
Atomic-scale surface structure and dynamics G2A62593
Structural investigations G2A62594
Engineering design support for Muon g-2 tracker G2A62596
Contributions to the development of a photon detector system G2A62598(131)
58,778
1,663
199,159
33,770(153)
33,216
22,94817,352
34,921
16,78836,88644,702
18,375
5,256
14,512
9,600
23,69927,342
29,028
10,974
17,194
7,952
1,090

-

1,277
666,198-

1,084,294-

153,077
153,077

69,891

Total Department of Homeland Security

153,077

69,891

Total Research and Development Cluster

9,572,838

920,027

Photodiodes Service Contract with Fermilab G2A62610
Passed-Through Universities Research Association, Inc.
Channeling Radiation Experiment at Fermilab ASTA User Facility G6A64152

81.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.00081.000-PO 608549
PO 609097
3F-31421
9J-30261-0042A
9J-30261-0049A
9J-30261-0051A
2778584J-30341-0002A
4J-30341- 0003A
DE-AC02-06CH11357
4J-30341-0008A

4J-30341-0010A
62433381.00081.00014-F-08

Total Department of Energy
DEPARTMENT OF HOMELAND SECURITY
Homeland Security Research, Development, Testing, Evaluation, and Demonstration of Technologies Related to Nuclear Threat Detection
Dept of Homeland Security G2A62588

97.077

2015-DN-077-ARI094--

69,891ECONOMIC DEVELOPMENT CLUSTERDEPARTMENT OF COMMERCE ECONOMIC DEVELOPMENT ADMINISTRATION
Economic Adjustment Assistance:
Rockford Region Economic Development - EDA/DOC Comprehensive Strategy 5 year update

G6B7022111.307

Total Economic Development Cluster

43

10,394
10,394-

10,394-

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

HIGHWAY SAFETY CLUSTERDEPARTMENT OF TRANSPORTATION
National Priority Safety Programs
20.616
20.616

FY15 Sustained Traffic Enforcement Program G4B67536
Sustained Traffic Enforcement Program (STEP) G4B67553

Total Highway Safety Cluster

6,695
4,480

-

11,175-

11,175-37,662
37,662-

TRIO CLUSTERDEPARTMENT OF EDUCATIONTRIO - Student Support Services G1B66736

84.042

TRIO - Upward Bound G1B66755

84.047

P042A101432

P047A121484

Total Trio Cluster

440,427-

440,427-

478,089-

162,000
162,000-

162,000-(69)
11,4303,377
14,738-14,738-44,36144,361-44,361-CCDF CLUSTERDEPARTMENT OF HEALTH AND HUMAN SERVICES
Child Care and Development Block Grant
Pass-Through Illinois Department of Human Services
41-CP30140 / 41-MC24596

93.575None

Total CCDF Cluster
SPECIAL EDUCATION CLUSTER (IDEA)
DEPARTMENT OF EDUCATION
Special Education_Grants to States
Passed-Through Southern Illinois University:
IDEA: State Personnel Development Grant-IL IHE Partnership G4B67517
IDEA: State Personnel Development Grant-IL IHE Partnership G4B67538
IDEA: State Personnel Development Grant-IL IHE Partnership G4B67562

84.02784.02784.027763944763944-007

Total Special Education Cluster (IDEA)OTHER PROGRAMSDEPARTMENT OF HEALTH AND HUMAN SERVICES ARRA
Health Information Technology Regional Extension Centers Program:
Office of National Coord for Health Information Technology
Illinois Health Information Technology Exchange Program Collaborative
ARRA G1B66725

93.718

90RC0023/01

Total Department of Health and Human Services ARRA
DEPARTMENT OF EDUCATION
Title I Grants to Local Educational Agencies
Illinois Interactive Report Card Module G4B67524

84.010IIRC Design Work G4B67525

84.01018,914-

99,740-118,654-

Migrant Education - State Grant Program
Migrant Education_State Grant Program G4B67560

84.011

3,828-

Rochelle Migrant Incentive Program G4B67561

84.011

987

-

4,815

-

(3,273)214,194
251,839462,760-

National Resource Centers Program for Foreign Language and Area Studies or Foreign Language
and International Studies Program and Foreign Language and Area Studies Fellowship Program:Foreign Language and Area Studies Fellowships G1B66734
National Resource Center at Northern Illinois University G1B66768
Foreign Language and Area Studies Fellowships G1B66769

84.01584.01584.015

44

P015A100167
P015A140055
P015B140055

State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

DEPARTMENT OF EDUCATION (Continued)
Rehabilitation Long-Term Training:
Preparation of Rehabilitation Teachers and Orientation & Mobility of
Rehabilitation of Individuals Who are Deaf or Hard of Hearing G1B66738

84.129H129Q100002

11,156
11,156-

110,438--

Rehabilitation Services Demonstration and Training Programs:
Preparing the USA for the UEB: A Massive Open Online Course for Personnel Providing
Vocational Rehabilitation Services or Educational Services to You G1B66771

84.235

H235E140006

110,438
Twenty-First Century Community Learning Centers:
Passed-Through the Communities in Schools of Aurora, Inc21st CCLS FY2015 West Chicago SD33 G6B70231

84.287

Special Education Personnel Development to Improve Services and Results for Children With Disabilities:
Program for Training of Teachers and Orientation and Mobility Instructors G1B66760
Project Prevent and Address Bullying (PPAB) for Student with Disabilities: A Multitiered Behavorial Framework G1B66783

84.32584.325Preparing new teachers of students with visual impairments G1B66790

84.325English Language Acquisition State Grants:* Passed-Through Illinois State Board of Education:
Development of Reading ESL, Early Childhood, Math and Science: Project
Dreams G1B66750

84.365

H325K130217

31,50031,500-270,865
68,131-

4,616
343,612

T365Z110199-12

Mathematics and Science Partnerships:
Passed-Through Illinois State Board of Education:
Integrated Professional Development Using Next Generation Science Exemplar G6B70244

84.366

Improving Teacher Quality State Grants:
Passed-Through Illinois Board of Higher Education
NIU Higher Ed Transitions Committee: Regional College Readiness Partnership G4B63061
FY14 Promoting Achievement thru Literacy Skills Across High School Curriculum G4B67521

84.36784.367

IBHE
IBHE

84.412

IBHE-

323,473
323,473-

34,74934,749-6,386
91,60097,98667,00367,003-

Race to the Top – Early Learning Challenge
Passed-Through Illinois Board of Higher Education
Northern Illinois Consortium for Early Childhood Articulations G3B67546

Total Department of Education

24,792-

24,792-

1,563,935

67,003

DEPARTMENT OF AGRICULTURE
Child and Adult Care Food Program
Passed Through Illinois State Board of Education:Federal School Lunch Program 41-CP30140/41-MC24596

10.558

Total Department of Agriculture

45

55,00055,000-55,000-State of Illinois
Northern Illinois University
Schedule of Expenditures of Federal Awards (Continued)
as of June 30, 2016
Federal Grantor/Pass-Through Grantor
Program/Grant Title

CFDA
NumberFederal Project orPass-ThroughNumber

FY 2016
Expenditures

To
Subrecipients

DEPARTMENT OF LABOR
Employment Training Administration
H-1B Job Training Grants:
Job Innovation Accelerator Challenge G2B66753

17.268

JA-22454-11-60-A-17

Total Department of Labor
DEPARTMENT OF STATE
Professional and Cultural Exchange Programs - Citizen Exchanges
Youth Leadership Program 2013: Phillippines: Environmental Leadership in the Phillipines G2B66757
Youth Leadership Program 2013 - Phillippines: Environmental Leadership in the Phillipines G2B66758
Belizean Youth Sport Coalition for Youth Development and Social Change G2B66762
Southeast Asia Youth Leadership Program 2014 G2B66765
Citizens Exchange Programs: Youth Programs Project: GLOBAL G2B66772 / G2B66773
FY2014 Southeast Asia Youth Leadership Program G2B66775 / G2B66776
PYLP 2015 G2B66785 / G2B66786

19.41519.41519.41519.41519.41519.41519.415

Public Diplomacy Programs2015 Fulbright Gateway Orientation G2B66779

S-ECAPY-12-CA-154(RJ)
S-ECAPY-12-CA-154 (RJ)S-ECAGD-13-GR-177 (DT)S-ECAGD-14-CA-1039
S-ECAPY-12-CA-154
S-ECAGD-14-CA-1039
S-ECAGD-15-CA-1123

19.040210,895
210,895

22,90722,907

210,895

22,907858(8,864)
98,603
7,034
41,941
458,513
191,044789,129

122,034
122,034

47,297-47,297
Academic Exchange Programs - Undergraduate Programs
Study of the US Institutes for Studend Leaders from SE Asia on Civic Engagemnet G2B66780

19.009

Leading and Organizing for Change in Southeast Asia G2B66782

19.009Total Department of StateNATIONAL ENDOWMENT FOR THE HUMANITIES
Promotion of the Humanities_Division of Preservation and Access
Textile Storage and Environmental Monitoring G2B66766

45.149From Theory to Practice: Extending the Reach of Digital Power Preservation
Workshops G2B66777

PG-52231-14

45.14993,673-99,733-

193,406-

1,029,832

122,034(595)-

91,578-90,983
Promotion of the Humanities_Fellowships and Stipends
Arabic Slave Writings and the American Canon G2B66742

45.160

2,100
2,100

-

977
977

-

94,060--

Promotion of the Humanities_Professional Development
NEH Enduring Questions Course on "What is the Role of Women in an Ideal Society?" G2B66759

45.163

AQ-50947-13

Total National Endowment for the Humanities-

ENVIRONMENTAL PROTECTION AGENCY
Office of Chemical Safety and Pollution Prevention
Regional Host Organization for Illinois Manufacturing Excellence

G6A64193

66.717

Total EPA

4,553

-

4,553

-

4,553

-

DEPARTMENT OF ENERGY
Department of Energy Managed Labs
Joint Appt: Zhili Xiao G2A62424

81.000DE-AC02-06CH11357

3,556

-

Joint Appt: Philippe Piot G2A62425

81.000PO 589180 Rev 1 & 2

74,797-

Joint Appt: Young Min Shin G2A62467

81.000PO 602342

Joint Appt: Andres Glatz G2A62497

81.000DE-AC02-06CH11357

20,850-

Joint Appt: Swapan Chattopadhyay G2A62569

81.000132,462-

Joint Appt: Zhili Xiao G2A62591

81.000109,097-

Joint Appt: Andres Glatz G2A62592

81.000100,855-

Joint Appt: David J Schroeder G2B66787

81.00078,647-

Joint Appt: Michael Syphers G2B66789

81.00099,390-671,158-

671,158-

87,62387,623-87,623-

Total Department of Energy
INSTITUTE OF MUSEUM AND LIBRARY SCIENCES
Museums for America
Anthropology Museum Rehousing Project G2B66770

45.301

Total Institute of Museum and Library Sciences

MA-30-14-0414-14

51,504-VIETNAM EDUCATION FOUNDATION
Fellowship Program
Vietnam Education Foundation Graduate Fellowship in Biology G2B66781

85.802

Total Vietnam Education Foundation
Total Other Programs

TOTAL EXPENDITURES OF FEDERAL AWARDS*

Cluster/program was tested as a major program in fiscal year 2016

46

24,077-

24,077-

24,077-

3,785,494

211,944

177,654,507

1,131,971

State of Illinois
Northern Illinois University
Notes to Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2016
Note 1.

Significant Accounting Policy

The accompanying Schedule of Expenditures of Federal Awards (Schedule) of Northern Illinois University(University) has been prepared on the accrual basis of accounting. The information in this schedule ispresented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200,
Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance). The Schedule does not purport to present the results of operations or the net income
or loss for the respective period as would a statement of income or a statement of revenues andexpenses. Pass-through entity identifying numbers are presented on the Schedule where available.
Note 2.

Nature of Programs

For purposes of the Schedule, federal awards include all grants, contracts, and similar agreements
entered into directly between the University and agencies and departments of the federal government andall sub-awards to the University by nonfederal organizations pursuant to federal grants, contracts, andsimilar agreements. The U.S. Department of Education has been designated as the University’s
cognizant agency for the audit performed in accordance with the requirements of the Uniform Guidance.
The University did not receive federal noncash assistance during the fiscal year ended June 30, 2016. No
federal insurance was received by the University during the year ended June 30, 2016.
Note 3.

Cost Allocation

The University has a plan for allocation of common and indirect costs related to grant programs inaccordance with, as applicable, either the cost principles in OMB Circular A- 21, Cost Principles for
Educational Institutions or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part
200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards.
The University allocates amounts to grant programs using an indirect cost rate based on a federally
negotiated higher education rate agreement, and therefore does not use the 10 percent de minimis rate
under the Uniform Guidance.
Note 4.

Reconciliation of the Schedule of Expenditures of Federal Awards to the Statementof Revenues, Expenses, and Changes in Net Position

The following is a reconciliation of total expenditures as reported on the accompanying Schedule of
Expenditures of Federal Awards to the operating revenue item of federal and state grants and othercontracts and the nonoperating revenue item of Pell grants on the Statement of Revenues, Expenses,
and Changes in Net Position included in the University’s financial statements:(in Thousands)
Total expenditures as reported in the Schedule of
Expenditures of Federal Awards
Remove the following:Federal Perkins Loan Program, Beginning Fund BalanceFederal Perkins Loan Program, New Loans
Federal Direct Loans Program
Add the following:
Direct state grants/contracts
Total federal and state grants and other contracts, FSEOG, andPell Grants revenues as reported in the Statement of
Revenues, Expenses, and Changes in Net Position

47$

177,655(8,399)(993)(122,984)
12,168$57,447

State of Illinois
Northern Illinois University
Notes to Schedule of Expenditures of Federal Awards (continued)
For the Year Ended June 30, 2016
Note 5.

Federal Student Loan Program

During the fiscal year ended June 30, 2016, the University issued new loans to students under theFederal Direct Student Loan Program (FDLP). The loan program includes subsidized and unsubsidized
Stafford Loans, Parents’ Loans for Undergraduate Students (PLUS), and PLUS Loans for graduate andprofessional students. The value of loans issued for the FDLP is based on disbursed amounts. The loan
amounts issued during the year are disclosed on the Schedule. The University is responsible only for the
performance of certain administrative duties with respect to the federally guaranteed student loan
programs and, accordingly, balances and transactions relating to these loan programs are not included in
the University’s basic financial statements. Therefore, it is not practicable to determine the balance ofloans outstanding to students and former students of the University at June 30, 2016.
In addition, the University participates in the Federal Perkins Loan Program through the Department of
Education. This loan program is directly administered by the University and is considered a revolving loan
program whereby collections received on past loans, including interest, is loaned out to current students.
The beginning balance on these loans are disclosed in the Schedule. The outstanding balance at June30, 2016 was $7,880,094. The loans issued through the Federal Perkins Loan Program during the year
ended June 30, 2016, was $993,208. Loans outstanding at the beginning of the year and loans madeduring the year are included in the federal expenditures presented in the Schedule.

48

State of Illinois
Northern Illinois University
For the Year Ended June 30, 2016
Supplementary Information for State Compliance Purposes
Summary

Supplementary Information for State Compliance Purposes presented in this section of the report includes
the following:•

Fiscal Schedules and Analysis:
Schedule of Appropriations, Expenditures, and Lapsed Balances
Comparative Schedule of Net Appropriations, Expenditures, and Lapsed Balances
Comparative Schedule of Income Fund Revenues and Expenses
Schedule of Changes in Capital Assets
Comparative Schedule of Cash and Temporary Cash Equivalents, at Cost
Comparative Schedule of Investments, at Cost
Analysis of Receivables and Inventories
Analysis of Significant Variations in Expenses
Analysis of Significant Variations in Revenues
Analysis of Significant Variations in Account Balances
Analysis of Significant Lapse Period Spending
Schedule of Federal Expenditures, Nonfederal Expenses, and New Loans
Entity Financial Statements:
Other Entities:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in Plant Fund Balances
Auxiliary Business Operations, Service Departments, and Indirect Cost Support:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in Plant Fund Balances
Auxiliary Enterprises - Revenue Bond Funds:
Condensed Financial Information:
Balance Sheet
Schedule of Revenues, Expenditures and Changes in Current Fund Balances
Schedule of Revenues, Expenditures and Changes in Plant Fund Balances
Schedule of Indentured Capital Reserves (Unaudited)
Calculation Sheet for Current Excess Funds:
Other Entities (Unaudited)
Auxiliary Business Operations (Unaudited)
Service Departments (Unaudited)
Auxiliary Enterprises - Revenue Bond Funds (Unaudited)
Indirect Cost Support - Sources and Application of Indirect Cost Recoveries
Calculation Sheet for Indirect Cost Support Carryforward
Description of Accounting Entities
Auxiliary Enterprises - Revenue Bond Funds - Schedule of Revenues, Expenses,
and Changes in Net Position

49

State of Illinois
Northern Illinois University
For the Year Ended June 30, 2016
Supplementary Information for State Compliance Purposes
Summary (Continued)•

Analysis of Operations (Unaudited):
Cross-Reference Table of Reporting Requirements
University Functions and Planning Program (Unaudited)
Budget Impasse Disclosures
Interest Costs on Fiscal Year 2016 Invoices
Alternative Financing in Lieu of Appropriations and Programs to Address
Untimely Payments to Vendors
Comparative Employment Statistics (Unaudited)
Emergency Purchases (Unaudited)
Comparative Enrollment Statistics (Unaudited)
Schedule of Tuition and Fee Waivers (Unaudited)
Debt Financed by University-Related Organization (Unaudited)
Acquisition of Real Estate Costing in Excess of $250,000 and Not Funded
by a Separate Appropriation (Unaudited)
Bookstore Operations (Unaudited)
Comments on Certain Matters Regarding Auxiliary Enterprises, Activities, andAccounting Entities, and Tuition, Charges, and Fees (Unaudited)
Comments on Certain Matters Regarding University-Related Organizations andOther Matters (Unaudited)
Summary of Foundation Payments to/from the University (Unaudited)
Summary of Alumni Association Payments to/from the University (Unaudited)
Summary of Research Foundation Payments to/from University (Unaudited)
Current Unrestricted Funds - Auxiliary Enterprises - Revenue Bond Funds Occupancy Report of Residence Halls (Unaudited)
Current Unrestricted Funds - Auxiliary Enterprises - Revenue Bond Funds Insured Value Summary (Unaudited)

The accountants’ report that covers the Supplementary Information for State Compliance Purposespresented on page 6 in the Introductory Section states that it has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in the auditors’ opinion, except forthat portion marked “unaudited” on which the auditors expressed no opinion, it is fairly stated in allmaterial respects in relation to the basic financial statements, from which it has been derived, taken as awhole. The accountants’ report also states that the Analysis of Operations section has not been
subjected to the auditing procedures applied in the audit of the basic financial statements and,accordingly, they do not express an opinion or provide any assurance on this section.

50

State of Illinois

Schedule 1

Northern Illinois University
Schedule of Appropriations, Expenditures, and Lapsed Balances
Expenditure Authority for Fiscal Year 2016
Fourteen Months Ended August 31, 2016
Total
Expenditure

Lapse Period

Expenditures,

Authority

Expenditures

Expenditures

Fourteen

Balances(Net After

Through

July 1 toMonths Ended

LapsedTransfers)

June 30, 2016

August 31, 2016

August 31, 2016 August 31, 2016

26,403,200$ 26,403,150$$

26,403,200

26,403,150

50

26,403,200-

Scholarships

36,000-20,975

20,97515,025

Total State College and Univeristy Trust Fund

36,000-20,975

20,97515,02526,439,200$ 26,403,150

Public Act 99-0502, Public Act 99-0524, and CourtOrdered ExpendituresEDUCATION ASSISTANCE FUND-007
Ordinary and Contingent Expenses$

Total Education Assistance Fund50

26,403,200$-

STATE COLLEGE AND UNIVERSITY
TRUST FUND-417

TOTAL APPROPRIATED FUNDS$$

21,025$26,424,175$

15,025Note 1: Expenditure authority, appropriations, expenditures, and lapsed balances were obtained from the State Comptroller records as of September 30, 2016,and have been reconciled to University records.
Note 2: Expenditure amounts are vouchers approved and paid by the University and submitted to the State Comptroller for reimbursement of payments made tovendors.
Note 3: During Fiscal Year 2016, the University operated without enacted appropriations until Public Act 99-0502 and Public Act 99-0524 were signed
into law on April 25, 2016, and June 30, 2016 respectively. During the impasse, the Circuit Court of St. Clair County in AFSCME Council 31 v. Munger(15 CH 475) ordered the State Comptroller, in the absence of enacted annual appropriations, to "draw and issue warrants accomplishing payment of wages[for all State employees] at their normal rates of pay." As such, the University's court-ordered involuntary witholding payroll payments previously processed
through the State Treasury were merged into the enacted appropriation for Fund 007. Further, the University incurred reimbursable payroll and non-payroll
obligations within Fund 007 and 417, which the University was unable to process a reimbursement for the expenditures incurred by the
University's Income Fund until the passage of Public Act 99-0502 and Public Act 99-0524.
Note 4: Public Act 99-524 authorizes the University to pay Fiscal Year 2016 costs using its Fiscal Year 2017 appropriations for non-payroll expenditures.
The Analysis of Operations section of this report at page 86 includes information from University management about the number of invoices and the total dollar
amount of invoices held by the University to be submitted against its Fiscal Year 2017 appropriation.

51

State of Illinois
Northern Illinois University

Schedule 2

Comparative Schedule of Net Appropriations, Expenditures,and Lapsed Balances
For the Years Ended June 30, 2016 and 2015
Fiscal Years

Education Assistance Fund - 007
Appropriations (net after transfers)$

Expenditures
Ordinary and contingent expenses
Personal services
Contributions to Social Security andMedicareContractual services
Commodities
Equipment and library books
Telecommunications services
Automotive
CMS health insurance
Total expenditures

2016

2015

PA99-0502
PA99-0524

PA99-0001

26,403,200$

91,092,700

26,403,200-

82,410,600-

883,500
3,695,115
892,940
717,027
511,068
104,300
1,770,650

26,403,200

90,985,200

Lapsed balances

$

-

$

107,500

State College and University
Trust Fund - 417
Appropriations (net after transfers)$

36,000$36,000

Expenditures - scholarship grant awards

20,975Grand Total - All Funds
Appropriations (net after transfers)

20,600$15,025$

15,400$26,439,200$

91,128,700

Total expenditures

26,424,175

Lapse balances$

15,02591,005,800$

122,900

Note 1: Expenditure authority, appropriations, expenditures, and lapsed balances were obtained from the State
Comptroller records as of September 30, 2016, and have been reconciled to University records.
Note 2: Expenditure amounts are vouchers approved and paid by the University and submitted to the State
Comptroller for reimbursement of payments made to vendors.

52

Schedule 2

State of Illinois
Northern Illinois University
Comparative Schedule of Net Appropriations, Expenditures,and Lapsed Balances (Continued)
For the Years Ended June 30, 2016 and 2015

Note 3: During Fiscal Year 2016, the University operated without enacted appropriations until Public Act 99-0502 andPublic Act 99-0524 were signed into law on April 25, 2016, and June 30, 2016 respectively. During the impasse, theCircuit Court of St. Clair County in AFSCME Council 31 v. Munger (15 CH 475) ordered the State Comptroller, in theabsence of enacted annual appropriations, to "draw and issue warrants accomplishing payment of wages [for all
State employees] at their normal rates of pay." As such, the University's court-ordered involuntary witholding payroll
payments previously processed through the State Treasury were merged into the enacted appropriation for Fund007. Further, the University incurred reimbursable payroll and non-payroll obligations within Fund 007 and 417,
which the University was unable to process a reimbursement for the expenditures incurred by the University's
Income Fund until the passage of Public Act 99-0502 and Public Act 99-0524.
Note 4: Public Act 99-524 authorizes the University to pay Fiscal Year 2016 costs using its Fiscal Year 2017
appropriations for non-payroll expenditures. The Analysis of Operations section of this report at page 86 includes
information from University management about the number of invoices and the total dollar amount of invoices held by
the University to be submitted against its Fiscal Year 2017 appropriation.

53

State of Illinois

Schedule 3

Northern Illinois University
Comparative Schedule of Income Fund Revenues and Expenses
For the Years Ended June 30, 2016 and 2015

2016

2015

$ 158,056,807$ 153,511,711

6,880,517

7,880,215

810,440

2,105,688$ 165,747,764$ 163,497,614$ 128,015,872$

Income Fund Revenues
Tuition, net of waivers
Material fees
Other
Total Income Fund Revenues
Income Fund Expenses
Personal services
FICA/Medicare
Unemployment compensation benefits

84,201,999

3,062,839

2,550,579

35,33742,097

Group insurance

3,541,300

1,770,650

Contractual services

39,440,874

28,853,743

471,149

922,398

Commodities

2,651,375

2,970,530

Equipment and library books

5,586,783

8,858,610

Telecommunications

1,023,959

734,841

302,555

492,737

Award/grants and matching funds

8,617,175

7,698,791

Permanent improvements

1,023,690

1,750,469

Transfers out for non-revenue bond debt service

6,275,728

5,066,449

200,048,636

145,913,893

Depreciation expense

4,225,354

4,152,813

Capital asset additions/disposals(2,621,962)(4,330,325)

1,603,392(177,512)$ 201,652,028$ 145,736,381

TravelAutomotive

Expense Subtotal
GASB No. 35 Adjustments

GASB No. 35 Adjustments Total
Total Income Fund Expenses

Note 1: Income fund revenues and expenses are reported gross of scholarship discounts except those due totuition and fee waivers.
Note 2: In fiscal year 2016 the University expanded the number of expense line items disclosed for added clarity.
Fiscal year 2015's numbers have been adjusted for the change for comparison.

54

State of Illinois
Northern Illinois University

Schedule 4

Schedule of Changes in Capital Assets*
For the Year Ended June 30, 2016

Balance
June 30, 2015Land
Land improvements
Buildings
Equipment
Intangible assets
Construction in progress$

19,280,619
82,137,364
672,134,299
255,495,770
3,820,547
33,894,806

Totals$ 1,066,763,405

Additions$

Transfers

5,918,833
11,566,887$$ 17,485,720$

1,526,549
961,8314,049,933(6,538,313)-

Balance
June 30, 2016

Deductions$

5,456,063
1,267,471$

19,280,619
83,663,913
673,096,130
260,008,473
3,820,547
37,655,909$

6,723,534$ 1,077,525,591* This summary schedule was prepared using State property records required by the Illinois Administrative Code (Code). The capitalization policy in the
Code is different than the capitalization policy established by the Office of the State Comptroller for financial reporting in accordance with generally
accepted accounting principles.

55

State of Illinois
Northern Illinois University

Schedule 5

Comparative Schedule of Cash and Temporary
Cash Equivalents, at Cost
(Excluding Foundation and Alumni Association)
June 30, 2016 and 20152016
Cash on hand$

Checking accounts (1), yFormally:National Bank and Trust Co. of Sycamore,
Sycamore, Illinois
First National Bank, DeKalb, Illinois (fka Castle Bank)
Temporary cash investments
Illinois Funds - U.S. Bank, Springfield, Illinois
Illinois Funds Epay Deposit - Illinois National Bank, Springfield,
Illinois
Money market mutual funds:
The Bank of New York Mellon Trust Co., NA,
Chicago, Illinois:
Hoffman Estates Debt Reserves Fund andCommunications Ducts Reserve Fund
Old National Wealth Management
Evansville, Indiana:
Performance contact 11A, Escrow fundAmalgamated Bank, Chicago, Illinois$(1) These amounts represent bank balances.

56

101,000

2015$

97,82025,783,974
3,724,300

13,823,574
3,779,224

43,091,871

43,227,592

1,000

-

651,678

650,384

4,820,726
9,997,969

9,542,695

88,172,518$

71,121,289

State of Illinois
Northern Illinois University

Schedule 6

Comparative Schedule of Investments, at Cost
June 30, 2016 and 2015

U.S. Treasury obligations, U.S. agency obligations,treasury notes and strips, 0.375 to 1.55 percent

Note: Interest rates for June 30, 2016.

57

2016

2015

$ 69,196,328$ 123,637,232

State of Illinois
Northern Illinois University

Schedule 7

Analysis of Receivables and Inventories
June 30, 2016 and 2015

Receivables
Reported receivables as of June 30, 2016 and 2015 are summarized below ($000s):
June 30
2016

2015

Accounts receivable
Less allowance for doubtful accounts$

58,109(16,138)$

44,090(14,304)

Net accounts receivable$

41,971$

29,786Student loans receivable
Less allowance for doubtful accounts

$

7,930
(50)

$

8,572
(71)

Net student loans receivable

$

7,880

$

8,501

Accounts receivable consists primarily of amounts due from students ($46.1 million in 2016 and $35.5
million in 2015) and other agencies ($12.0 million and $8.6 million in 2016 and 2015, respectively).
Student loans receivable consists primarily of student loans issued under the federal government’s
Perkins Loan Program.
The University provides for an allowance for doubtful accounts to account for nonpayment of student
tuition.
The allowance for doubtful accounts relating to student notes is the result of the difficulty of collecting
Perkins Loan receivables.
The University utilizes the State offset system as well as private collection services to supplement
University collection procedures.

58

State of Illinois
Northern Illinois University

Schedule 7

Analysis of Receivables and Inventories (Continued)
June 30, 2016 and 2015

Inventories
Reported inventories as of June 30, 2016 and 2015 are summarized below ($000s):

June 30
2016

2015

Food
Books
Inventories for resale
Commodities and supplies
Other miscellaneous items

$

661
1,761
746
217
21

$

496
1,690
841
271
23

Total

$

3,406

$

3,321

Inventories are valued at cost (first-in and first-out or average cost method, depending on the nature of
the inventory item) or market, whichever is lower.

59

State of Illinois
Northern Illinois University

Schedule 8

Analysis of Significant Variations in Expenses
For the Years Ended June 30, 2016 and 2015
(in Thousands)
Following are explanations for significant variances between expense accounts reported in the Statement of Revenues, Expenses, andChanges in Net Position in the financial audit report exceeding $2,000,000 and 10%:2016
Research$

17,010

Increase(Decrease)2015$

14,480$2,530

Percent
Changes

Explanation

17%

Increase due to additional grant activity, primarily with theIllinois County Behavioral Risk grant and the IMEC grant in
FY16.

Public Service

18,035

21,489(3,454)-16%

Decrease primarily due to the Illinois Shared Learning
Environment grant ending in FY16. This decreased salaryexpense as well as experts/consultants, and contracts
expense.

Operation and maintenance of plant

25,57329,893(4,320)-14%

Decrease due to decline in salaries and a decline inrenovations partially offset by an increase in repairs andmaintenanceInstitutional support

26,592

36,630(10,038)-27%

Decrease due to additional expenses being capitalized for
projects in progress

Staff benefits

168,457

153,649

14,808

10%

Increase due to added costs from state-managed healthinsurance and unfunded pension costs

In fiscal year 2015, there was a GAS finding regarding the classification of the University's expense offset for assets that were capitalized. The University corrected theissue in fiscal year 2016 and reclassified the expense offset amounts for fiscal year 2015 to correct the prior year allocation for comparability. The numbers presented
above are from fiscal year 2016's financial statements which presented the adjusted numbers.

60

State of Illinois

Schedule 9

Northern Illinois University
Analysis of Significant Variations in Revenues
For the Years Ended June 30, 2016 and 2015
(in Thousands)
Following are explanations for significant variances between revenue accounts reported in the Statement of Revenues, Expenses, andChanges in Net Position in the financial audit report exceeding $2,000,000 and 10%:

2016State Appropriations

State Appropriations-on Behalf Payments

$

2015

Increase

Percent(Decrease)

Changes

26,424 $91,006 $(64,582)

Explanation
Due to the 2016 State Budget impasse, the University did-71% not receive the full state appropriation.

158,477

143,272

15,205

Increase due to state funding for employer required
11% contributions to CMS and SURS.
Due to the 2016 State Budget impasse, MAP funds were
disbursed for only 1/2 the year.

State of Illinois MAP

9,760

19,970(10,210)-51%

State Appropriations-Capital

1,823

9,143

(7,320)Due to the 2016 State Budget impasse, funding for capital-80% appropriations was decreased.

61

State of Illinois
Northern Illinois University

Schedule 10

Analysis of Significant Variations in Account Balances
June 30, 2016 and 2015
(in Thousands)
Following are explanations for significant variances between asset and liability accounts reported in the Statement of Net Position in the financial audit
report exceeding $2,000,000 and 10%:

2016
Cash and cash equivalents (Restricted
and Unrestricted)

Accounts receivable

$

2015

42,92541,971$

24,56729,786

Increase(Decrease)$

Percent
Changes

Explanation

18,35875% Increase due to liquidity strategies in light of budget impasse.

12,185

41%

Increase in student receivables attributed to reduced 2016
appropriation for the Illinois monetary award program.

21

16,965(16,944)

IL did not allot appropriations for the second half of the fiscal
year which resulted in this decrease in appropriations-100%
receivable. The emergency budget passed on June 30 was
designated for fiscal year 2017.

Investments(Restricted and Unrestricted)

112,406

166,650(54,244)-33%

Notes and Certificates of Participation
Payable10,866

13,291(2,425)-18% Decrease attributed to annual debt service payments.

Appropriations receivable from state

62

Decline attributed to budget impasse which resulted in more
liquid financial strategy.

State of Illinois
Northern Illinois University

Schedule 11

Analysis of Significant Lapse Period Spending
Year Ended June 30, 2016

No significant lapse period spending was noted for the Education Assistance Fund or the State Collegeand University Trust Fund.

63

State of Illinois
Northern Illinois University

Schedule 12

Schedule of Federal Expenditures, Nonfederal Expenses,
and New Loans
For the Year Ended June 30, 2016 (Accrual Basis)(Expressed in Thousands)

Schedule A - Federal Financial Component
Total federal expenditures reported on SEFA schedule
Total new loans made not included on SEFA schedule
Amount of federal loan balances at beginning of the year
(not included on the SEFA schedule) and continued
compliance required
Administrative cost allowance on federal loan programs (notincluded on SEFA schedule)
Other noncash federal award expenditures (not included
on SEFA schedule)$

177,655
-

*

-

*

-

*

Total Schedule A$

177,655

Total operating expenses (from financial statements)
Total nonoperating expenses and losses (from financial statements)
Total new loans madeAmount of federal loan balances at beginning of year
Administrative cost allowance on federal loan programs
Other noncash federal award expenditures$

555,478
24,101
123,978
8,399
159
-

Total Schedule B$

712,115-

Schedule B - Total Financial Component

Schedule C

AmountTotal Schedule A$

Total nonfederal expenses
Total Schedule B$

Percent

177,65524.9%

534,460

75.1%

712,115100%* Loan amounts and associated cost allowances (which reduced expense amounts reported in the financial
statements) are included on the SEFA schedule
These schedules are used to determine the University’s single audit costs in accordance with the Uniform
Grant Guidance.

64

State of Illinois
Northern Illinois University

Schedule 13

Other Entities
Condensed Financial Information
June 30, 2016

Balance Sheet
AssetsCurrent fund:Cash and cash equivalents
Other assets
Total current fundContinuing
Education
Contract
Courses$

Plant fund:
Plant fund assets

4,720,397
91,0124,811,409

Continuing
Education
and PublicService$

57,587

8,021,170
1,173,329
9,194,499

Sales andServices of
Educational
Activities$

637,672

7,680,473
1,384,580
9,065,053

Student
Programs
andServices$

264,937

143,056
143,056

Total$

994,710

20,422,040
2,791,977
23,214,017

1,954,906

Total Assets$

4,868,996$

9,832,171$

9,329,990$

1,137,766$

25,168,923

Liabilities
Accounts payable andaccrued expenses
Unearned revenue
Total liabilities$

31,113116,846
147,959$

378,750
432,114810,864$785,691
17,775
803,466$

7,400,606
4,804,615
12,205,221$

8,596,160
5,371,350
13,967,510

Fund balances
Current fund
Plant fundTotal fund balances
Total liabilities andfund balances

4,663,450
57,587
4,721,037$

4,868,996

8,383,635
637,672
9,021,307$

9,832,171

8,261,587
264,937
8,526,524$

9,329,990(12,062,165)
994,710(11,067,455)

9,246,507
1,954,906
11,201,413$

1,137,766$

25,168,923

Schedule of Revenues, Expenditures andChanges in Current Fund Balances
For the Year Ended June 30, 2016
Beginning current fundbalances
Revenues
Expenditures
Transfers
Ending current fundbalances$

4,750,047
3,152,918(2,260,197)(979,318)$

7,960,264
10,966,762(10,361,420)(181,971)$

6,940,312
8,014,531(7,570,581)
877,325$(1,653,431)
26,223,100(36,689,626)
57,792$

17,997,192
48,357,311(56,881,824)(226,172)$4,663,450$

8,383,635$

8,261,587$(12,062,165)$

9,246,507

65

State of Illinois
Northern Illinois University

Schedule 13

Other Entities
Condensed Financial Information (Continued)
Schedule of Revenues, Expenditures and Changes
in Plant Fund Balances
For the Year Ended June 30, 2016

Continuing
Education
Contract
Courses
Beginning plant fund balances$

Revenues
Expenditures

Ending plant fund balances

55,229Continuing
Education
and PublicService$673,124

10,027(7,669)$57,587

Sales andServices of
Educational
Activities$

13,197(48,649)$

637,67266

272,283

Student
Programs
andServices$

42,333(49,679)$

264,937

1,040,724

Total$

74,642(120,656)$

994,710

2,041,360
140,199(226,653)$

1,954,906

State of Illinois
Northern Illinois University

Schedule 14

Auxiliary Business Operations, Service Departments,
and Indirect Cost Support
Condensed Financial Information
June 30, 2016

Balance Sheet
AssetsCurrent fund:Cash and cash equivalents
Accounts receivable
Inventories
Other assets
Total current fund

AuxiliaryBusiness
Operations$

Plant fund:
Plant fund assets

6,895,489
2,999
7,698
252,731
7,158,917

Indirect
Cost
SupportService
Departments$

126,000

7,378,009
172,959714,225
388,027
8,653,220$

10,030,502

4,676,231
28
4,676,259

Total

$

947,123

18,949,729
175,986
721,923
640,758
20,488,396

11,103,625

Total assets$

7,284,917$

18,683,722$

5,623,382$

31,592,021

Liabilities
Accounts payable andaccrued expenses
Unearned revenue
Total liabilities$

34,094
3,017,698
3,051,792$

1,966,617
1,966,617$

135,452$

135,452

2,136,163
3,017,698
5,153,861

4,540,807
947,123
5,487,930

15,334,535
11,103,625
26,438,160

Fund balances
Current fund
Plant fundTotal fund balances
Total liabilities andfund balances

4,107,125
126,000
4,233,125$

7,284,917

6,686,603
10,030,502
16,717,105$

18,683,722$

5,623,382$

31,592,021

2,390,202$

15,339,729

Schedule of Revenues, Expenditures andChanges in Current Fund Balances
For the Year Ended June 30, 2016
Beginning current fund balances$

Revenues
Expenditures
Transfers
Ending current fund balances

2,807,397$

8,880,322(7,894,995)
314,401$

4,107,125

67

10,142,130$

48,145,234(51,600,761)$

6,686,603

4,132,733(2,172,325)
190,197$

4,540,807

61,158,289(61,668,081)
504,598$

15,334,535

State of Illinois
Northern Illinois University

Schedule 14

Auxiliary Business Operations, Service Departments,
and Indirect Cost Support
Condensed Financial Information (Continued)
Schedule of Revenues, Expenditures and Changes
in Plant Fund Balances
For the Year Ended June 30, 2016

AuxiliaryBusiness
Operations
Beginning plant fund balances$

Revenues
Expenditures

Ending plant fund balances

169,892$

7,167(51,059)$

Indirect
Cost
SupportService
Departments

126,000

68

6,187,160$

5,601,860(1,758,518)$

10,030,502

941,418

Total$

155,391(149,686)$

947,123

7,298,470
5,764,418(1,959,263)$

11,103,625

State of Illinois
Northern Illinois University

Schedule 15

Auxiliary Enterprises - Revenue Bond Funds
Condensed Financial Information
June 30, 2016

Balance Sheet
AssetsCurrent fund:Cash and cash equivalents
Accounts receivable
Inventories
Due from plant fund
Subtotal Current fundResidence
Halls$

Plant fund:Accounts receivable
Restricted investments
Land, Buildings & Equipment
Subtotal Plant fund

75,896,914
540,470808,255
3,361,360
80,606,999

Student
Services$

811,943
27,885,797
195,178,800
223,876,540

Recreation
Facilities

7,066,273
117,621
1,775,516
8,959,410$

18,611,260
18,611,260

318,579
3,467
322,046

Parking$

38,026,410
38,026,410

Total

1,137,071
1,137,071

84,418,837
661,558
2,583,771
3,361,360
91,025,526

6,579,779
6,579,779

811,943
27,885,797
258,396,249
287,093,989$ 378,119,515

Total assets$ 304,483,539$

27,570,670$

38,348,456$

7,716,850

Liabilities
Accounts payable andaccrued expenses
Unearned revenue
Subtotal Current fund$$64,001
138,493
202,494$

20,888
147,543
168,431

$

130
130

2,743,488
1,007,390
3,750,878$$

2,828,507
1,293,426
4,121,933

Plant fundAccounts payable andaccrued expenses
Due to current fund
Debt
Subtotal Plant fund

14,930,980
3,361,360
315,736,841
334,029,181

-

-

-

14,930,980
3,361,360
315,736,841
334,029,181

Total liabilities

337,780,059

202,494

168,431130

338,151,114

Fund balances
Current fund
Plant fundTotal fund balances

76,856,121(110,152,641)(33,296,520)

8,756,916
18,611,260
27,368,176

153,615
38,026,410
38,180,025

1,136,941
6,579,779
7,716,720

86,903,593(46,935,192)
39,968,401

Total liabilities andfund balances$ 304,483,539

7,716,850$ 378,119,515$

27,570,670

69$

38,348,456$

State of Illinois
Northern Illinois University

Schedule 15

Auxiliary Enterprises - Revenue Bond Funds
Condensed Financial Information (Continued)
June 30, 2016

Schedule of Revenues, Expenditures andChanges in Current and Plant Fund Balances
For the Year Ended June 30, 2016
Residence
Halls
Current fund:
Beginning fund balances
Allocation of Cash Adjustment*
Reclassification of Debt Service
Activities**
Adjusted beginning fund balance
Revenues
Expenditures
Ending current fund balances

Plant fund:
Beginning fund balances
Reclassification of Debt Service
Activities**
Adjusted beginning fund balance$ 116,913,535(63,436,653)$(12,226,049)
19,083,109

Recreation
Facilities$(39,037,567)
39,369,169

Parking$(4,221,413)
4,984,375

Total

$

61,428,506-

11,059,002
64,535,884

6,857,060

331,602762,962

11,059,002
72,487,508$

46,959,155(34,638,918)
76,856,121$

14,270,189(12,370,333)
8,756,916$

5,355,423(5,533,410)
153,615$

2,194,231(1,820,252)
1,136,941$

68,778,998(54,362,913)
86,903,593$(80,873,861)$

19,083,109$

39,369,169$

4,984,375$(17,437,208)

Revenues
Expenditures
Ending plant fund balances
Total fund balances

Student
Services$(11,059,002)(91,932,863)

19,083,109

39,369,169

4,984,375(11,059,002)(28,496,210)

6,531,366(24,751,144)(110,152,641)

490,393(962,242)
18,611,260

539,355(1,882,114)
38,026,410

1,883,037(287,633)
6,579,779

9,444,151(27,883,133)(46,935,192)(33,296,520)$

27,368,176$

38,180,025$

7,716,720$

39,968,401* The current fund balance reclassification is due to a change in assumptions used when preparing the schedules. In prior years, theschedules were prepared under the assumption that the revenue bond fund sub-entities, recreation facilities, student services, andparking, funded their plant fund additions through the use of current fund resources vs. through the use of the restricted bond proceeds.
As these sub-entities did not have enough cash in their current funds to pay for the additions, they used cash from the residence hallsub-entity in which all the restricted revenue bond fund proceeds were recorded. In the current year, it was determined this was aninaccurate assumption as all revenue bond sub-entities have a right to use the restricted bond proceeds for additions and additions
were paid for using those funds.
** The debt service reclassification for $11.1 million includes investments ($6.9 million) and accrued investment income ($0.8 million)
offset by current bond obligation ($4.8 million), capital lease interest payable ($4.0 million), and accrued payables ($10.0 million).
These values were previously reported under the current fund category but in the current year it was determined they would be more
properly reported as part of the plant fund.

70

State of Illinois
Northern Illinois University

Schedule 16

Auxiliary Enterprises - Revenue Bond Funds
Schedule of Indentured Capital Reserves
June 30, 2016
(Unaudited)$

Replacement cost of buildings

770,451,183
49,091,767

Replacement cost of equipment
Total replacement cost of buildings and equipment$

819,542,950

Allowable indentured capital reserves - 5 percent of total
replacement cost of buildings and equipment$

40,977,148

Less actual indentured capital reserve at June 30$

Margin of compliance

40,977,148

Note: Replacement costs shown above were calculated based on provisions of the University Guidelines
1982, as amended in 1997, and the bond indenture, using the original cost of the facilities adjusted for thechange in the building cost index as reported in the “Engineering News Record.”

71

State of Illinois
Northern Illinois University

Schedule 17

Other Entities
Calculation Sheet for Current Excess Funds
June 30, 2016
(Unaudited)
Continuing
Education
Contract
Courses
1. Current available funds:Cash
2. Working capital allowance:
Highest month's expenditures
Encumbrances and current
liabilities paid in lapse period
Unearned revenue
Total working capital allowance

3. Current excess funds:
Deduct B from A and enter here.

A. $4,720,397

Continuing
Education
and PublicService$

Sales andServices of
Educational
Activities

8,021,170$

7,680,473

Student
Programs
andServices$

Totals-$

20,422,040

1,727,806

3,439,162

2,768,586

13,044,310

20,979,864

B.

31,113116,846
1,875,765

378,750
432,1144,250,026

785,691
17,775
3,572,052

7,400,606
4,804,615
25,249,531

8,596,160
5,371,350
34,947,374

C.

2,844,632

3,771,144

4,108,421(25,249,531)(14,525,334)

4. Calculation of income fund remittance:
An entity may offset excess capitalor current funds within the entity.
Enter the amount to be offset, if any,
D.
here.

(3,339,517)(1,564,349)(2,035,612)(2,036,577)(8,976,055)

Enter the algebraic sum of C and D
and remit the amount due, if any, fordeposit in the income fund.

$(23,501,389)

Excess funds offset calculation
Buildings
Maximum rate
Building capital offset$

45,526,322 $
5%2,276,316

- $
5%
-

- $
5%
-

5%
-

$

45,526,322
5%2,276,316

Equipment
Maximum rate
Equipment capital offset$

5,316,004 $20%
1,063,201

7,821,745 $
20%
1,564,349

10,178,060 $20%
2,035,612

10,182,885
20%
2,036,577$

33,498,694
20%
6,699,739

Total excess funds offset$

3,339,517

1,564,349

2,035,612

2,036,577$

8,976,055

Note:

$

$

$

Assets subject to the excess fund calculation are recorded in the University Plant Fund. Separate ledgers are maintained
detailing the composition and source of these assets for the excess fund calculation.

72

State of Illinois
Northern Illinois University

Schedule 18

Auxiliary Business Operations
Calculation Sheet for Current Excess Funds
June 30, 2016
(Unaudited)1.

Current available funds:
Add:
Cash and cash equivalents
Total current available funds

2.

$ 6,895,489
A.

6,895,489

Working capital allowance:
Add:
Highest month’s expenditures
Encumbrances and current liabilities paidin lapse period
Unearned revenue
Working capital allowance3.

34,094
3,017,698
B.

7,338,156

C.

(442,667)

D.

(359,917)(155,608)

Current excess funds:
Deduct B from A and enter here

4.

4,286,364

Calculation of income fund remittance:
An entity may offset excess capital or current
funds within the entity. Enter the amountto be offset, if any, here.
Enter the algebraic sum of C and D and remit
the amount due, if any, for deposit in the
Income Fund.

73$(958,192)

Schedule 19

State of Illinois
Northern Illinois University
Service Departments
Calculation Sheet for Current Excess Funds
June 30, 2016
(Unaudited)1.

Current available funds:
A. $Cash and cash equivalents
2.

Working capital allowance:
Highest month’s expenditures
Encumbrances and current liabilities paidin lapse period
Unearned revenue
Total working capital allowance3.

11,552,991
1,966,617
B.

13,519,608

C.

(6,141,599)

D.

(9,955,013)

Current excess funds:
Deduct B from A and enter here

4.

7,378,009

Calculation of income fund remittance:
An entity may offset excess capital or current
funds within the entity. Enter the amount to beoffset, if any, here.
Enter the algebraic sum of C and D and remit
the amount due, if any, for deposit in the
Income Fund.

74$ (16,096,612)

State of Illinois
Northern Illinois University

Schedule 20

Auxiliary Enterprises - Revenue Bond Funds
Calculation Sheet for Current Excess Funds
June 30, 2016
(Unaudited)

ResidenceHalls
A. Current available funds:
Add:
Cash
Total current available
funds

$

75,896,914

Student
Services$

7,066,273$

Recreation
Facilities

Parking318,579$ 1,137,071

Excess
Cash
Total

$

84,418,837

75,896,914

7,066,273

318,579

1,137,071

84,418,837

60,704,570

3,640,903

1,777,942

274,530

66,397,945

B. Working capital allowance:
Add:
Highest month's expenditures
Encumbrances and current
liabilities paid in lapse
periodUnearned revenue
Working capitalallowance

2,743,488
1,007,390

64,001
138,493

20,888
147,543130-2,828,507
1,293,426

64,455,448

3,843,397

1,946,373

274,660

70,519,878

C. Current excess funds:
Deduct B from A and enter
here.

11,441,466

3,222,876(1,627,794)

862,411

13,898,959

D. Capital offset - Building
Capital offset - Equipment
Capital Offset Total(38,522,559)(9,818,353)(48,340,912)
Total

75

$ (34,441,953)

State of Illinois
Northern Illinois University

Schedule 21

Indirect Cost Support
Sources and Application of Indirect Cost Recoveries
For the Year Ended June 30, 2016

Balance, beginning of year$

2,390,202

SourcesFederal and state grants and contracts

4,132,733

Applications
Research
Instruction
Public service
Academic support
Student services
Operation and maintenance of plant
Institutional support
Staff Benefits

688,516
16,433
1,412
673,890672
76,388714,625
389

Total applications

2,172,325

Transfers

190,197

Net increase

2,150,605

Balance, end of year$76

4,540,807

State of Illinois
Northern Illinois University

Schedule 22

Calculation Sheet for Indirect Cost
Support Carryforward
June 30, 2016

1.

Cash and cash equivalents balance:
Enter the June 30 indirect cost entity balance forcash and cash equivalents:
Add:
Cash and cash equivalents

2.

Allocated reimbursements:
Enter the total indirect cost reimbursements allocatedfor expenditure for the fiscal year completed:$4,290,449. Enter 30 percent of this amount.

3.

1,287,135

Unallocated reimbursements:
Enter the lesser of the actual unallocated indirect cost
reimbursements for the year completed OR 10
percent of total indirect cost allocations for theyear completed.

4.

$ 4,676,231

429,045

Encumbrances and current liabilities paid in the lapse period:
Enter the amount of:Current liabilities

135,452

Indirect cost carryforward:Enter the total of Items 2, 3, and 4

1,851,632

Subtract from Item 1

2,824,599

If a positive number results, enter here and remit for
deposit in the Income Fund77

$ 2,824,599

State of Illinois
Northern Illinois University

Schedule 23

Description of Accounting Entities
June 30, 2016
A listing of the University’s auxiliary enterprise accounting entities, their purpose, and their sources ofrevenue as of June 30, 2016 is provided below:

AUXILIARY ENTERPRISES
Revenue Bond Funds
This entity represents all of the activity of the Auxiliary Enterprises Revenue Bond Funds. This includes
the student residence halls, student center, recreational facilities, and campus parking. Construction ofeach of these facilities was either fully or partially funded through the issuance of revenue bonds. The
primary sources of revenue include room and board income, student fees, bookstore sales, food service
operations, parking fee and fines, and investment income.
Auxiliary Business Operations
This entity consists of auxiliary services primarily supported by student fees. The sub-entities are:
Lorado Taft - The purpose of this account is to support the operations of the Lorado Taft dormitory andfood service. Income is from food sales, dorm rentals, conference fees, and facility use fees.
Student Contract Busing - This is the student campus bus operation. Income is from student fees.
University Health Service - The Health Service provides clinic-type services to University students. It is
supported from student fees.

SERVICE DEPARTMENTS
This group of accounts provides service to various University departments on a charge-back basis. Rates
are established and reviewed periodically to operate each service department on a break-even basis.

INDIRECT COST SUPPORTThese accounts are supported by indirect cost reimbursements or accounts that receive funding as a byproduct of federal grants. The funds pay for administrative costs, physical plant costs, including utilities,
and grant proposals.

78

State of Illinois
Northern Illinois University

Schedule 23

Description of Accounting Entities (Continued)
June 30, 2016
OTHER ENTITIESContinuing Education Contract Courses
These activities are established to provide credit courses to individuals and groups external to theinstitution. Revenues are mainly from tuition for the courses.
Continuing Education and Public Service
These activities are established primarily to provide noncredit services to individuals and groups external
to the institution. These activities include community service programs and cooperative extension
services. Included in this category are conferences, institutes, general advisory services, reference
bureaus, radio and television, consulting, and similar non-instructional services to particular sectors of thecommunity.
Sales and Services of Educational Activities
Sales and services of educational activities support instruction and help demonstrate classroom or related
educational techniques to students. Revenues are from services or materials furnished which areincidental to the department. Receipts are from testing, cartographic services, book sales, sales of
instructional materials, and public opinion services.
Student Programs and Services
These programs are supported by student activity fees, gate receipts from athletic events, and income
from concerts and performances sponsored by the Student Association.
In addition to the intercollegiate athletics program, the funds sponsor a variety of student functions,
including speakers, acquisition of art objects, artist series, legal assistance, orientation, and grant-in-aid.

79

State of Illinois
Northern Illinois University

Schedule 24

Auxiliary Enterprises - Revenue Bonds Funds Schedule of Revenues, Expenses, andChanges in Net Position
For the Year Ended June 30, 2016

Revenues
Food and other merchandise sales$

21,314,921

Room and other rentals

33,524,595

Parking revenue

2,739,772

Student fees

15,863,792

Interest in investments

323,125

Other revenues

4,456,944
78,223,149

Total revenues
Expenses
Cost of food and other merchandise sales

7,835,195

Personal services

13,766,859

Student services

4,032,459

Employee meals furnished

28,360Insurance

398,482

Laundry

164,994

General and administrative

4,391,337

Repairs and other services

12,373,521

Utilities

5,389,398

Interest expense

22,007,067

Depreciation

11,858,374
82,246,046

Total expenses$

Change in net position

80(4,022,897)

State of Illinois
Northern Illinois University
Cross-Reference Table of Reporting Requirements
June 30, 2016
(Unaudited)
In accordance with an Office of the Auditor General, July 25, 2000 memorandum entitled Matters Regarding
University Audits (Memorandum), certain supplemental data is required to be reported by the University. The tablebelow cross-references the Memorandum requirements (indicated by number and letter paragraph references) to
the University financial statements, compliance examination; and audit reports for the year ended June 30, 2016,
where such special data is found.

Reference Number from T. Loobey’s
Memorandum Dated July 25, 2000,
on University Guidelines
13a.
13b.
13c.
13d.
13e.
13f.
13g.
13h.
13i.
13j.
13k.
13l.
13m.
13n.
13o.
13p.
13q.
13r.
13s.
13t.
13u.

Violation of University Guidelines, 1982 as Amended
Sources and Application of Indirect Cost Recoveries
Calculation Sheet for Indirect Cost Support Carryforward
Amount of Tuition Diverted to Auxiliary Enterprise Operations
List of Accounting Entity and Description of Sources and Purposeof Revenues
Financial Statements for Each Accounting Entity
Calculations of Current Excess Funds for Each Accounting Entity
Support to Auxiliary Enterprise from State Appropriated Funds
Statement of Receipts and Disbursements for Bond Indentures
Conformity of Bond Fund Accounting to Terms of Bond Issues
List of Noninstructional Facilities Reserves
List of Organizations Recognized as University Related
Organizations (UROs)
Amounts Paid by UROs to the University for Services Provided by
the University
Amounts Paid by the University to UROs for Services Provided by
the URO
Amount of Unreimbursed Subsidies to UROs
Debt Financing of UROs
Schedule of Cash and Investments Held by the University
Allocation Method on Interest from Pooled Investments
Costs Per Full-Time Equivalent Student
Acquisition of Real Estate by University or URO Greater Than
$250,000 and Not Specifically Funded
Issuance of Certificates of Participation (COPs) or Participation in
Lease or Purchase Arrangements Involving COPs

Report andPage Number
Where Information
is Disclosed
Supplementary
Information forState CompliancePurposes
N/A
76
77
94
78-79
65-70
72-75
94
80
71, 9494
95
96-98
96, 98
95
91
56-57
95
N/A
92
95

Other Financial Related Schedules for Universities
1.
2.
3.

Schedule of Appropriations, Expenditures, and Lapsed Balancesby Major Line Item
Schedule of Income Fund Revenues and Expenses
Schedule of Tuition and Fee Waivers

81

51
54
90

State of Illinois
Northern Illinois University
University Functions and Planning Program
For the Year Ended June 30, 2016
(Unaudited)

NIU Statement of Vision and Mission
The vision of Northern Illinois University is to be a premier student‐centered, research‐focused
public university, contributing to the advancement of knowledge for the benefit of the people of theregion, the state, the nation, and the world.
With this vision, the mission of the University is to promote excellence and engagement inteaching and learning, research and scholarship, creativity and artistry, and outreach andservice.
Our Keystone Goal
Students who invest in an NIU education are committed to achieving fulfilling careers and being
responsible citizens in our changing world. Our goal is to provide them a broad‐based educationand enriching student experience, ensuring their timely degree completion and success insecuring employment in their field of interest or graduate school enrollment within six months ofgraduation, if they so choose.
Our Core Values
The following three pillars reflect NIU Core Values.

•

We will practice ethically inspired leadership in all that we do, and ensure our
graduates are prepared to be ethical and inspired leaders in their fields andcommunities.

•

We are committed to building thriving communities at NIU, embracing diversity,and engaging with other stakeholder communities we serve regionally and globally.
We inspire students to become actively engaged and form bonds that will serve
them as students and into their careers.

•

We recognize NIU’s financial sustainability as our responsibility and fundamental
to our existence. We practice and advance principles of environmental, economic
and social sustainability which enrich the lives of our students, faculty, staff and theworld we live in.

Our Collaborative Strategic Culture
Our strategic planning process is designed to achieve an institutional norm of ongoing, aligned
strategic thinking that ensures NIU’s continued relevancy and leadership during a time of
unprecedented change in higher education. We build on our previous planning initiatives as well as
our current knowledge of changing student demographics, emerging pedagogies and players, andrealities of government funding and job markets.

82State of Illinois
Northern Illinois University
University Functions and Planning Program (Continued)
For the Year Ended June 30, 2016
(Unaudited)
All academic and supporting services units are encouraged to engage in an ongoing process of
exploring ideas and creating their program scenarios, goals and action plans guided by thisFramework and our Strategic Imperatives.
This process is enabled by NIU’s rich legacy, our strong programs and engaged stakeholders. All
are encouraged to participate responsibly through our system of shared governance, taking
ownership of their own and their university’s bold futures. Through these bonds of shared values,
agreements, teamwork and trust, we nurture an environment for unleashing and empowering acollaborative culture of innovation and change among faculty, students, staff, alumni andcommunity.
Our Triangle Strategy
The Triangle Map provides a big‐picture of our strategic and organizational playing field. By
mapping our individual unit scenarios and action plans on this field, we further collaborate ourindividual initiatives and encourage our big‐picture awareness of opportunities and direction.

83

State of Illinois
Northern Illinois University
University Functions and Planning Program (Continued)
For the Year Ended June 30, 2016
(Unaudited)
This Triangle Map connects three fields representing Students, Academics and theWorld, and a fourth field representing Supporting Services. Strategy and action plans
can be developed to address initiatives within each of these fields, as well as addressing
connections among the fields. NIU’s distinguishing roles in research and engagement
provide additional opportunities and purpose for connecting each.
The four fields ‐1. Students are NIU’s purpose, passion and economic engine. NIU is committed
to being the school of choice for a strong, diverse student population including
first‐generation students.

2. Our Academic programs and faculty define who we are as an institution, providing
an integrated liberal arts education offering vibrant research projects andengagement opportunities, and being internationally recognized for the diversity andaccomplishment of our faculty and staff.
3. The World around us provides changing global and societal needs for our teaching,research and engagement activities, job markets for our students, partners for our
programs, diversity in our students and faculty, and accomplished alumni supporting
our people, programs, and place.
4. Supporting Services facilitate our ability to focus on Students, Academics and theWorld by providing enabling services and supporting our student and academic
initiatives.
Our Strategic Imperatives
The following Strategic Imperatives are provided as touchstones, points of significant
opportunity for NIU to change and thrive at this time. They are not intended to be fully
inclusive and permanent. Not every initiative needs to address these imperatives to be vital.
By referring to the imperatives while engaging in our individual planning initiatives, it isexpected we will consider possibilities for advancing each, and ensure a basis for connecting
our distributed strategic initiatives into our collaborative culture and direction as an institution.
As we achieve goals and are informed by our environment over time, strategic imperatives
will change.
1. Come together as a collaborative, mutually supportive and aligned NIU
community to take control of our destiny and realize our full potential.
2. Develop face‐to‐face connections with every NIU student to understand theirneeds, choices and experiences, and achieve desired retention and enrollment goals
and learning and graduation outcomes.

84

State of Illinois
Northern Illinois University
University Functions and Planning Program (Continued)
For the Year Ended June 30, 2016
(Unaudited)
3. Achieve career fulfillment and fair compensation for faculty and staff, ensuring
NIU’s national recognition for excellence and engagement in teaching and learning,
research and scholarship, creativity and artistry, and outreach and service.
4. Increase affordability of a high quality NIU education by focusing on opportunities suchas innovative use of technology, seeking efficiencies in administration and operations,attracting diversified sources of funding, and ensuring timely graduation and career
readiness through effective advising and course scheduling.
5. Maximize the value of the residential campus experience in order to enhance learning
outcomes and recruitment, and build a sense of place that connects and inspires whileserving the unique needs of our diverse populations including both regional andinternational students.
6. Significantly grow NIU as a leading public research university, building on our existingareas of research strength and the Chicago region as a world leader in innovation, while
continuing to engage undergraduate and graduate students in faculty‐driven and student‐
initiated research and artistry.
7. Enhance the global competitiveness and livability of our local economies byintegrating the talent and resources of NIU faculty, staff and students with those of ourregion to positively impact economic and workforce development, innovation andentrepreneurship, and the quality of life.
Program Prioritization
In the fall of 2014, NIU began a program prioritization process that will be critical to the growth of
the university and our ability to deliver on our cornerstone goal of student career success. Its goal is tobuild a strong foundation for maintaining and improving the quality of academic and administrative
programs across NIU, by assuring that our programs reflect our institutional mission and strategic goals.
Program prioritization will help accelerate our ability to create stronger and more lasting connections
across our “triangle” of students, faculty, and the outside world. More information about program
prioritization can be found at: www.niu.edu/program-prioritization.

Location, Address, and Head of the University
Douglas D. Baker, President
Northern Illinois University
DeKalb, Illinois 60115

85

State of Illinois
Northern Illinois University
Matters Related to the Budget Impasse and Its Impact
For the Year Ended June 30, 2016
(Unaudited)
Budget Impasse Disclosure
Payment of Fiscal Year 2016 Costs in Future Fiscal Years
Article 74 of Public Act 99-0524 authorized the University to pay Fiscal Year 2016 costs using the
University’s Fiscal Year 2017 appropriations for operational expenditures. The following chart shows the
University’s plan to expend its Fiscal Year 2017 appropriations to cover its Fiscal Year 2016 costs:

Fund #
007

Fund Name
Education Assistance Fund

Dollar Value

Number17$

48,158,000Interest Costs on Fiscal Year 2016 Invoices
Prompt Payment Interest Costs
The University did not incur any prompt payment interest due to vendors under the State Prompt Payment
Act (Act) (30 ILCS 540). The University’s vendors were paid from funds and accounts that are ineligible forprompt payment interest due to vendors under the Act.
Alternative Financing in Lieu of Appropriations and Programs to Address Untimely Payments to
Vendors
Transactions Involving the Illinois Finance Authority
The University and its vendors did not participate in alternative financing in lieu of enacted appropriations
involving the Illinois Finance Authority during Fiscal Year 2016.
Transactions Involving the Vendor Payment Program and Vendor Support Initiative Program
None of the University’s vendors participate in the Vendor Payment Program (VPP) or the Vendor Support
Initiative Program (VSI) during Fiscal year 2015 and Fiscal Year 2016.

86

State of Illinois
Northern Illinois University
Comparative Employment Statistics*
June 30, 2016 and 2015
(Unaudited)Year ended June 30, 2016:
Appropriated funds:
Facility/administrative
Civil service
Student employees
Miscellaneous contracts
Nonappropriated funds:
Facility/administrative
Civil service
Student employees
Miscellaneous contracts
Total All Funds
Year ended June 30, 2015:
Appropriated funds:
Facility/administrative
Civil service
Student employees
Miscellaneous contracts
Nonappropriated funds:
Facility/administrative
Civil service
Student employees
Miscellaneous contracts
Total All Funds

Operations andMaintenanceIndependent
Physical Plant
Operations

Total
All
Functions

Instructional
Activities

Organized
Research

PublicServiceAcademic
SupportStudent
Services

Institutional
Support

1,317.3
258.0
42.9
18.7
1,636.9

10.6
9.9
0.3
20.8

21.3
11.9
0.1
33.3

148.8
140.4
20.3
6.0
315.5

96.7
56.9
10.2
5.4
169.2

116.8
155.3
3.9
5.1
281.1

6.6
236.2
10.5
3.3
256.6

-

1,718.1
868.6
88.1
38.6
2,713.4

90.0
9.4
26.6
9.7
135.7

115.4
9.2
12.1
15.5
152.2

134.2
24.0
11.2
101.1
270.5

25.2
21.1
1.4
5.5
53.2

114.2
75.1
101.0
4.4
294.7

10.7
37.8
8.3
2.5
59.3

1.5
68.9
0.5
1.3
72.2

42.0
237.0
189.7
33.1
501.8

533.2
482.5
350.8
173.1
1,539.6

1,772.6

173.0

303.8

368.7

463.9

340.4

328.8

501.8

4,253.0

1,353.7
259.8
50.6
29.6
1,693.7

7.0
2.8
0.2
0.2
10.2

25.7
18.6
0.1
0.1
44.5

152.5
141.6
25.8
10.3
330.2

95.7
57.1
11.1
7.8
171.7

111.9
173.0
4.7
6.8
296.4

6.0
226.7
14.0
7.7
254.4

-

1,752.5
879.6
106.5
62.5
2,801.1

109.6
7.6
27.3
7.3
151.8

126.0
7.1
10.8
18.9
162.8

130.9
22.9
7.1
32.4
193.3

29.3
23.7
4.9
6.6
64.5

118.7
71.4
96.8
4.6
291.5

12.9
37.6
10.9
5.6
67.0

1.7
73.7
0.9
2.1
78.4

42.0
270.5
222.3
41.4
576.2

571.1
514.5
381.0
118.9
1,585.5

1,845.5

173.0

237.8

394.7

463.2

363.4

332.8

576.2

4,386.6*Provided by the Office of Budget and Planning.
This is the employment information reported to the State of Illinois Board of Higher Education. Staff years are computed by dividing an employee’s number of months of employment
during the fiscal year by 12 and multiplying that number by a factor of one for full-time and multiplying by the percentage of appointment for part-time. One example of staff year
computation is as follows:
1 full-time employee employed 12 months of fiscal year counts as 1 staff year.
87State of Illinois
Northern Illinois University
Emergency Purchases
For the Year Ended June 30, 2016
(Unaudited)

Following is a list of emergency purchase affidavits filed by the University with the Office of the Auditor
General during the year:

ASGK Public Strategies LLC – Actual Cost: $20,875
Consulting services for communications counsel for issue management and ongoing support in crisis
communications to ensure the maintenance of the of the university's reputation and relationships withstakeholders and the community was required due to numerous recent events and a lack of sufficientinternal resources. Northern Illinois University required immediate crisis management services tomitigate negative perception of the University.

Anthony Travel – Actual Cost: $77,128
NIU Football team played in the Poinsettia Bowl on December 23, 2015, and air travel was required forthe band and cheer team (not enough time to process a competitive source selection).

Sheraton San Diego Hotel & Marina – Actual Cost: $137,650
Poinsettia Bowl Football Team Lodging, December 19-23, 2015, in San Diego, CA (immediate action toprevent disruption in University services and to protect/further University interests; hotel is determined by
Bowl organization).

Charles J. Shepard – Actual Cost: $22,661
A 90-day emergency purchase was issued to this vendor for the purpose of a real estate lease. This
short-term award allowed the State adequate time to review the renewal of an existing lease agreement
and allowed for the required 60-day advertisement of the renewal award prior to the renewal/purchaseorder issuance.

Urban Equity Properties LLC – Actual Cost: $26,622
A 90-day emergency purchase was issued to this vendor for the purpose of a real estate lease. This
short-term award allowed the State adequate time to review the renewal of an existing lease agreement
and allowed for the required 60-day advertisement of the renewal award prior to the renewal/purchaseorder issuance.

88State of Illinois
Northern Illinois University
Comparative Enrollment Statistics*
June 30, 2016
(Unaudited)

Summer
2015

Fall
2015

Semesters
SpringSummer
2016
2014

Fall
2014

Spring2015

On-Campus:
Undergraduate
Graduate
Professional

1,877
1,543
51

13,0452,293
312

11,726
2,145
289

1,827
1,428
33

13,394
2,367
343

12,0352,259
320

Subtotal

3,471

15,65014,1603,288

16,104

14,614

Off-Campus:
Undergraduate
Graduate

336
1,090

324
764

428
703

360
1,222

327
717

320
740

Subtotal

1,426

1,088

1,131

1,582

1,044

1,060

Total

4,897

16,73815,291

4,870

17,14815,674

Note: All full-time equivalents are computed as follows:
Fall and Spring semesters:
Undergraduate full-time equivalent=Credit hours
15.00

Graduate full-time equivalent=Credit hours
12.00

Professional full-time equivalent=Credit hours
12.00

Summer sessions:
Undergraduate full-time equivalent=Credit hours
7.50

Graduate full-time equivalent=Credit hours
6.00* Provided by Office of Budget and Planning based on beginning of semester count for Fall and Springsemesters and end of the semester count for Summer.

89

State of Illinois
Northern Illinois University
Schedule of Tuition and Fee Waivers
For the Year Ended June 30, 2016
(in Thousands)(Unaudited)

Undergraduate
Mandatory waivers:
Teacher/special
education
General Assembly
ROTC
DCFS
Children of employees
Senior citizens
Discretionary waivers:
Faculty/administrative
Civil service
Academic/other talent
Athletic
Gender equity inintercollegiate
athletics
Foreign students
Cooperating
professionals
Graduate assistants
Interinstitutional/related
agencies
Retired University
employees
Children of deceased
employees
Student need - financial
aid
Student need - special
programs
Other assistants
Fellowships
Contract/training grants
Total

Tuition Waivers
Graduate

93

Undergraduate

Fee Waivers
Graduate

165
3
33
-

-

9
68

11
1

-

-

168
3
33
20
69
-

Total

477
8
294
191
595
9

-

24
219
1,760
1,467

487
292
1,475
-

570
8
298
206
595
9
511
511
3,235
1,467

1,644
-

257

1,644
257

-

-

-

18

1,136
9,211

1,154
9,211

-

-

-

16

56

72

-

-

-

2

36

38

1

-

1

32

11

-

11

4
15

32

-

23
$

Total

6,779

$

3

-

-

-

-

-

20
1,734
89
960

20
1,757
89
960

-

-

-

15,865$90

22,644

$

290

$

15

$

305

State of Illinois
Northern Illinois University
Debt Financed by University-Related Organization
For the Year Ended June 30, 2016
(Unaudited)

In August 2006, the Northern Illinois University Foundation issued bonds in connection with theconstruction of the Jeffrey and Kimberly Yordon Center which were secured by a ten-year operating leasewith the University. The bonds were issued at an effective interest rate of 4.66% which was renegotiatedto 1.875% in March 2013. These bonds were fully retired in August 2015 and the lease payments fromthe University ended August 2016.
In March 2013, the Northern Illinois University Foundation issued bonds in connection with theconstruction of the Kenneth and Ellen Chessick Practice Center. At June 30, 2016, the amount ofoutstanding bonds were $2,263,207. The bonds were issued at an interest rate of 1.62% and are due
March 2021. An 89-month operating lease with the University secures these bonds.
In December 2014, the Northern Illinois Research Foundation issued a $200,000 note payable for theacquisition of EIGERlab. At June 30, 2016 the amount of the note outstanding was $144,134. The note
was issued at an interest rate of 4% with monthly payments to be made until December 2019.

91

State of Illinois
Northern Illinois University
Acquisition of Real Estate Costing in Excess of$250,000 and Not Funded by a Separate Appropriation
For the Year Ended June 30, 2016
(Unaudited)

The University and UROs did not purchase any real estate costing in excess of $250,000.

92

State of Illinois
Northern Illinois University
Bookstore Operations
For the Year Ended June 30, 2016
(Unaudited)

Contracted/rents to students/University operated

University operated

Contractor

N/A

Contract term

N/A

Amount of gross sales for Bookstore in FY 16$4,097,206

Amount (if any) to be paid to Bookstore for FY 16
by University

N/A

Commissions

N/A

Commission terms

N/A

Given exclusive rights

No

Competition/”other” nearby/on-campus bookstores

Yes

93

State of Illinois
Northern Illinois University
Comments on Certain Matters Regarding AuxiliaryEnterprises, Activities, and Accounting Entities,
and Tuition, Charges, and Fees
June 30, 2016
(Unaudited)

AUXILIARY ENTERPRISES, ACTIVITIES, AND ACCOUNTING ENTITIES
1. All employer contributions, except for certain restricted federal funds, to the University retirement
system are made from the General Revenue Fund appropriation to the State Universities Retirement
System for this purpose. Accordingly, the portion of the retirement contribution attributable toemployees in auxiliary enterprise operations is paid from appropriated funds and amounted toapproximately $9,747,136 and $10,272,420 for the years ended June 30, 2016 and June 30, 2015,
respectively.
2. The University’s governing board has established no non-instructional facilities (development)
reserves.

TUITION, CHARGES, AND FEES
Northern Illinois University does not have statutory authority to divert and is not diverting tuition toauxiliary enterprise operations.

BOND COVENANTS
There were no violations of revenue bond covenants noted during the audit of Northern Illinois University
for the year ended June 30, 2016.

94

State of Illinois
Northern Illinois University
Comments on Certain Matters Regarding
University-Related Organizations
and Other Matters
June 30, 2016
(Unaudited)

1. Northern Illinois University Foundation, Northern Illinois University Alumni Association, and Northern
Illinois Research Foundation are recognized by Northern Illinois University as related organizations.
2. There are no organizations considered by the University to be independent organizations as definedin Section VII of University Guidelines 1982, as amended in 1997.
3. There are no unreimbursed subsidies between the University and its related organizations.
Comment on Other Topics
1. Income from investments of pooled funds is allocated and credited monthly to the original sources ofthe funds based on their respective cash balances.
2. In August 1993, the University issued $8,485,000 of Certificates of Participation to refinance an
educational center occupied by Northern Illinois University in Hoffman Estates, Illinois, payablethrough installments commencing in 1994, for a period of twenty-three years. Balance at June 30,
2016 was $1,305,000.
3. In April 2014, the University issued Certificates of Participation (Capital Improvement Projects) in theamount of $11,975,000 at a premium of $1,140,000. The proceeds were used to refinance a 113,000
square foot facility located on the campus of and for the use of Northern Illinois University byredeeming all of the Illinois Development Finance Authority Lease Revenue Bonds (Northern Illinois
Naperville Project) Series 1999 in the amount of $11,630,000 and prepaying an Installment Payment
Contract between the Board and Energy Systems Group, LLC in the amount of $1,182,000. This
resulted in approximate savings of $916,000 in future debt service payments on the old debt. The
Series 2014 COPs are payable through installments commencing in 2015, for a period of elevenyears. The interest is 4%-5%; the balance at June 30, 2016 was $11,035,000.

95

State of Illinois
Northern Illinois University
Summary of Foundation Payments
To/From the University
For the Year Ended June 30, 2016
(Unaudited)

During fiscal year 2016, the University engaged the Foundation, under contract, to provide fundraising
services. As provided in the contract agreement, the University paid $630,000 for fundraising services.
Additionally, the University provided services to the Foundation valued at $643,000. As required by thecontract, the Foundation fully repaid the University for the services provided, using funds consideredunrestricted for purpose of the University Guidelines computations.
Presented below is a summary of all funds that the Foundation gave to the University during fiscal year
2016:
Funds considered unrestricted for purposes of the Guidelines
computations:
Totally unrestricted - administrative services
Restricted only as to campus, college, or department andgenerally available for ongoing University operations:Support for University programs and departments
Administrative and office expense
Provided for library books, equipment, and property
and improvements
Total funds considered unrestricted$

5,263,111
862,357
20,0296,804,243

Funds considered restricted for purposes of the Guidelines
computations:
Provided for scholarships and awards
Provided for library books, equipment, and property andimprovements
Other restricted funds provided to the University:
Restricted fundEndowment fundTotal funds considered restricted
Total funds provided to the University by the Foundation

96

658,746

2,785,359
41,344
1,255,146
596,404
4,678,253$

11,482,496

State of Illinois
Northern Illinois University
Summary of Alumni Association Payments
To/From the University
For the Year Ended June 30, 2016
(Unaudited)

In accordance with a memorandum of understanding between the University and the Alumni Association
with regard to funding staffing costs in the alumni relations area, the Alumni Association did not make any
contributions during 2016. There were no amounts paid by the University to the Alumni Association.
Presented below is a summary of all funds that the Association gave to the University during fiscal year
2016:
Funds considered unrestricted for purposes of the Guidelines
computations:
Restricted only as to campus, college, or department andgenerally available for ongoing University operations:Support for University programs and departments$

340,081

Total funds considered unrestricted

340,081

Funds considered restricted for purposes of the Guidelines
computations:
Endowment fund25,000Total funds considered restricted

25,000Total funds provided to the University by the Association$

97

365,081State of Illinois
Northern Illinois University
Summary of Research Foundation Payments
To/From University
For the Year Ended June 30, 2016
(Unaudited)

During fiscal year 2016, the University engaged the Research Foundation, under contract, to provide
services to aid the University in its economic development, public service/research and educational
missions, valued at $353,000.
Presented below is a summary of all funds that the Research Foundation gave to the University during
fiscal year 2016:
Funds considered unrestricted for purposes of the
Guidelines computations:
Total unrestricted - administrative services
Support for University programs and departments$ 188,000
1,080,000

Total funds considered unrestricted$ 1,268,000

98

State of Illinois
Northern Illinois University
Current Unrestricted Funds - Auxiliary Enterprises Revenue Bond Funds - Occupancy Reportof Residence Halls
For the Fiscal Year 2016
(Unaudited)

DesignCapacity

Fall
SemesterOccupancy

SpringSemesterOccupancy

AverageOccupancy

Room and
Board
Rate

1,117

968

821

895

9,760

Gilbert Hall

270

233

223

228

10,756

Northern View

240

175

167

171

7,708

Grant Towers

1,660

633

567

600

10,756

Stevenson Towers

1,280

1,186

1,066

1,126

10,756

New Hall

1,008

976

946

961

13,350Total Residence Halls

5,575

4,171

3,790

3,981

Neptune Complex

Based on 9 month occupancy.

99

State of Illinois
Northern Illinois University
Current Unrestricted Funds - Auxiliary Enterprises Revenue Bond Funds - Insured Value Summary
For the Year Ended June 30, 2016
(Unaudited)

Insured Value
Building

Business
Interruption

Contents

Barsema Alumni & Visitors Center
Campus Life Building
Campus Child Care Center
Center for Black Studies
Convocation Center
Gilbert Hall
Grant Towers Complex
Holmes Student Center
Huskie Stadium
Huskie Stadium Field Turf
Latino Center
Lincoln Hall
Neptune Complex
Neptune North
Parking Services/Duramad House
Parking Structure
Stevenson Towers Complex
Student Recreation Building
University Resources for Women
Evans Field House
Dorland Warehouse
Soccer Field Building
Northern View Community
New HallWestern Intramural Facilities
Business interruption$

8,129,000
9,340,000
3,113,000
666,000
55,230,000
17,563,000
106,026,000
75,964,000
29,777,000
500,000
856,000
36,813,000
34,088,000
13,371,000
180,000
10,983,000
106,026,000
14,524,000
410,000
12,571,000
9,877,000
861,000
14,400,000
76,386,000
5,949,000-$

478,000
1,595,000
254,000
6,310,000
2,641,000
5,280,000
3,264,000
205,000
1,956,000
2,454,000
451,000
210,000
8,351,000
899,000
1,136,000
2,809,000
338,000
3,808,000
1,872,000-$

44,770,000

Total

$

643,603,000$

44,311,000$

44,770,000

The University obtains its property insurance, including boiler and machinery coverage, through theMidwestern Higher Education Compact’s Master Property Program. The University purchases limits of $1
billion in layers: the first layer provides $100 million in individual limits and the next two layers provide a
total of $900 million on a shared, but per occurrence, basis. The Holmes Student Center has coveragefor silverware and silverplate, and State and University self-insurance programs and commercial
insurance are in force to provide liability coverage for University operations, including Revenue Bond.
100