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State advises UNI changes after finding thousands in improper transactions

Jan. 22, 2015 10:32 pm
IOWA CITY - The state auditor is advising the University of Northern Iowa establish policies around the financial transactions of student organizations after an investigation into bookkeeping for its International Dance Theatre program revealed $15,215 in improper disbursements and undeposited collections.
The disbursements and collections in question were related to a non-university International Dance Theatre account between Dec. 1, 2005, and Feb. 28, 2014. The UNI Department of Public Safety in February discovered the suspicious records in the office of the program's director at the time, Daniel Wells, during an investigation not related to his university duties.
While searching Wells' office, investigators found records related to the non-university dance theatre account established at a local credit union, including blank checks and carbon copies of issued checks, according to a report made public Thursday out of the Office of the Auditor of State.
The disbursements included $11,690 in checks that Wells is accused of issuing to himself from the account, according to the report. They also included $200 of cash withdrawals from the account and $75 in overdraft fees.
Undeposited collections identified by the auditor's office totaled $3,250 and included estimated ticket sales for certain theatre performances, according to the auditor's report.
Wells also is accused in the report of issuing checks totaling $8,350 to the theatre program from his personal account between Dec. 10, 2009, and Nov. 29, 2012, and making $5,228 in purchases for the program using his personal account and credit card.
Because the director of UNI's School of Health, Physical Education and Leisure Services, which financially supports the theatre program, was not aware the account existed or why checks were issued to Wells, the state auditor got involved.
'Student organizations are allowed to maintain bank accounts outside the university's bank accounts and accounting system,” according to the report.
But the institution has no policies regarding those accounts.
'As a result, the accounts may be maintained by students, faculty advisers, or other designated individuals,” according to the report. 'Requirements have not been established regarding controls or monitoring of the bank accounts.”
Wells, 50, became director of the theatre program in 2006. UNI spokesman Scott Ketelsen said he was a temporary employee from Sept. 7, 2005, to May 9, 2014, and he was employed on a semester-by-semester contract, depending on course offerings.
Wells was placed on paid leave Feb. 19, 2014, 'as a result of concerns not related to the non-university (dance theatre) account,” according to the report. His employment contract expired in May, and it was not renewed, the auditor reported.
Findings from the report have been shared with Board of Regents' Office of Internal Audit, UNI's Department of Public Safety, the Division of Criminal Investigation, the Black Hawk County Attorney's Office, and the Attorney General's Office.
No criminal charges have been filed against Wells in Black Hawk County in connection with the case to date, according to online court records.
Wells could not be reached for comment for this story.
Other recommendations the state auditor has made 'to strengthen the university's internal controls related to student organizations” include segregating the duties of those who collect, prepare, and deposit collections.
'Sufficient records, such as ticket stubs, collection counts, and related reconciliations, should be maintained and compared to deposits recorded in the university's accounting system,” according to the report. 'The student organizations should also periodically obtain copies of financial transactions recorded in the university's accounting system for the student organization and review the transactions for propriety.”
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