Revised statement on the Internal Audit of Intercollegiate Athletics by Rutgers President Richard L. McCormick and Director of Athletics Robert E. Mulcahy III

Rutgers is fully committed to excellence in both academics and athletics. Just as at other outstanding public research universities, both endeavors contribute to the institution’s quality and reputation. The recent success of the Rutgers athletics program has brought tremendous pride to New Jersey and the university. As the program grows, we will continue to make every effort to ensure that its practices and policies are consistent with the institution’s high standards of integrity and accountability.

Every year, as required by the NCAA, a qualified independent accountant prepares a report of expenses and revenues for the university’s intercollegiate athletics program. This year, in addition to the annual external review, an audit of the business practices of the Division of Intercollegiate Athletics was conducted by the university’s Internal Audit Department. This audit is one of many conducted throughout the university on a regular basis by the Internal Audit Department to review the efficiency and effectiveness of operating procedures and internal controls.

The Internal Audit Department reports to the Audit Committee of the Rutgers Board of Governors. The confidential and advisory nature of such audits is essential to assure that the university administration and the Audit Committee can receive honest and accurate assessments of the operations under review and so that they can initiate corrective actions if necessary.

The Internal Audit Department’s findings and recommendations regarding the Division of Intercollegiate Athletics were presented in a report to the administration and the Audit Committee in February 2008. Immediately following submission of the report, Rutgers Athletics, working with the university administration, began to take action on each recommendation. Specifically:

• Rutgers Athletics is in the process of hiring a deputy director of finance and administration, a position newly created to manage the division’s finance, budget and accounting.
  
  

• It is common practice for universities to contract with sports marketing firms to manage their sponsorships and pay certain associated expenses.  Rutgers engages Nelligan Sports Marketing (NSM) for this purpose, and the net revenues from the NSM sponsorships are reflected in the intercollegiate athletics budget.  The university is now exercising its right to audit the NSM contract and is reviewing the accounting procedures associated with the administration of the contract to ensure that all revenues and expenses are properly accounted for.
  
  

• Rutgers Athletics is reviewing and updating its Policies and Procedures Manual to address the growth and increasing complexity in its operations. A preliminary draft is nearing completion and is currently under review.
  
  

Rutgers’ success on the football field and in other intercollegiate sports is an important goal for the university – just as the continued achievements of our philosophy department, our cell and DNA repository, our women’s and gender studies programs, and our outstanding students are points of pride that we celebrate widely. Academics and athletics can reinforce each other, which is why Rutgers remains committed to excellence in both.