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Audit unearths dysfunction, obfuscation and questionable financial deals between University and Foundation

Related Topics: Audit

By Kyeland Jackson —

After 18 months of investigation, Kentucky Auditor Mike Harmon’s audit found a slew of questionable practices between the University of Louisville and the U of L Foundation, U of L’s endowment manger.

Citing “serious weakness” in ULF’s governance, the audit found:

• Delays and inconsistencies in information provided, which, along with numerous open records violations, validated concerns of poor transparency;

• Poor segregation between the administrative operations between U of L and ULF, resulting in ineffective governance practices and management having too much influence without appropriate checks and balances;

• A dysfunctional governing climate due to excessive board conflicts;

• Endowment funds used for loans to ULF and an affiliate without appropriate notification to and approval of the U of L Board of Trustees;

• The appointment of an acting ULF Chief Administrative Officer without appropriate authorization from the ULF Board of Directors; and

• Compensation provided to the former U of L and ULF President greater than amounts approved by the U of L Board of Trustees.