POLICY APPOINTMENT OF EXPERT ADVISORS
TO THE COMMITTEE ON COMPLIANCE AND AUDIT
Approved March 20, 2008
The Regents' Committee on Compliance and Audit will
appoint expert advisors to serve as subject matter experts
in finance and compliance to assist the Committee in
performance of its responsibilities. The advisors will
meet requirements of relevant education, experience
and credentials, will meet the University’s standards
for independence, and will be reviewed for actual or
potential conflicts of interest. Reference and background
checks will be completed prior to appointment. The term
of appointment will be 1-3 years. Terms may be renewed
if the screening committee and the Chair of the Committee
on Compliance and Audit determine that the individual should be reappointed
for an additional term. This policy describes the criteria
and process for selection.
I. The Selection Process
A. Applications and nominations
will be sent to the Office of the Secretary and Chief
of Staff or the Office of the Senior Vice President–Chief
Compliance and Audit Officer.
B. Candidates will be contacted at
the appropriate time to confirm their willingness to
serve for a one to three year term. If they are willing
to serve, independence and confidentiality requirements
and a background check will be conducted. They will
also be informed of Regents policies concerning defense
and indemnification.
C. The Secretary and Chief of Staff
or designee will convene a screening committee to review
candidates. Members of the screening committee will
be the Chair of the Committee on Compliance and Audit, the Senior Vice
President–Chief Compliance and Audit Officer of
The Regents, the Secretary and Chief of Staff to The
Regents, the Vice President and General Counsel of The
Regents, the Vice President–Financial Management
and the current Financial and Compliance Advisors. With
the exception of the Advisors, all members may delegate
their role to a designee. Members will solicit comments
from others as appropriate. The Chair of the Committee
on Compliance and Audit may designate additional members of the screening
committee.
D. Persons eligible for appointment
as expert advisors to the Committee on Compliance and Audit must be
independent and there must be no conflicts of interest.
Criteria for exclusion include:
1. Employment of the individual or immediate family
by the University of California or the U.S. Department
of Energy.
2. Employment of the individual or immediate family
by the current external auditor.
3. The individual or immediate family member has
been a contractor or consultant to the University or
participated in their organization’s decisions
related to consulting with the University, receiving
more than $60,000 (total) within the past three calendar
years.
E. The screening committee will assess the following:
1. Professional credentials and relevant experience.
2. Potential conflicts for the candidate or the candidate’s
immediate family members.
3. Affiliations or connections with the University
and its related entities.
4. References and background checks done through
selected public sources
F. Prior to making the final selection, information
about the finalist(s) for the appointment(s) will be
forwarded to the Chairman of the Board and the Chair
of the Committee on Finance to solicit their views.
The Chair of the Committee on Compliance and Audit will make the final
decision on the candidate to advance to the Committee
on Compliance and Audit for appointment.
II. Financial Advisor Selection Criteria
A. Financial Advisor shall have the following attributes:
1. An understanding of generally accepted accounting
principles and financial statements. For the University,
knowledge of accounting principles as promulgated by
the Governmental Accounting Standards Board (GASB) applicable
to higher education is preferred.
2. Experience in:
a. Preparation or auditing of financial statements
of generally comparable institutions and
b. Familiarity with application of such principles in
connection with the accounting for estimates, accruals
and reserves, including third-party reserves of Medical
Centers as well as self-insurance reserves
c. The design and evaluation of internal controls
3. Understanding of Compliance and Audit Committee functions including
oversight of ethics and compliance matters
B. The foregoing attributes must have been acquired through
any one or more of the following:
1. Education and experience as a principal financial
officer, principal accounting officer, controller, public
accountant or auditor or experience in one or more positions
that involve the performance of similar functions;
2. Experience actively supervising any of the above-listed
positions or person performing similar functions
3. Experience overseeing or assessing the performance
of companies or public accountants with respect to the
preparation, auditing, or evaluation of financial statements,
or
4. Other relevant education and experience
III. Description of the Role of the Financial
Advisor
A. The Financial Advisor to the Committee on Compliance and Audit
is to provide advice and consultation to the Committee
in the following areas:
1. Financial and accounting matters, including assistance
in reviewing UC financial statements and in asking appropriate
questions regarding those statements; the University’s
choices of accounting principles, any changes in accounting
principles and estimates having a significant impact
on the financial statements;
2. Compliance with GASB pronouncements and changes
in auditing standards;
3. Independent views of management’s compliance
with accounting standards;
4. The University’s internal control structure
and processes, material changes in controls, the control
implications of contemporary internal or external issues,
and the significance of control findings reported to
the Committee;
5. A view of the public accountant’s expertise
and overall performance;
6. General assistance with audit committee oversight
of the University’s accounting, auditing, ethics
and compliance practices.
IV. Compliance Advisor Selection Criteria
A. A Compliance Advisor shall have the following attributes:
1. An understanding of corporate ethics and compliance
programs, including development and implementation programs
as well as systems for monitoring. Experience in a university
setting would be helpful.
2. Experience in:
a. Prevention, detection and response to compliance
risks; education, auditing and monitoring concepts;
b. Understanding implications for compliance and culture
in a changing regulatory environment;
c. Design and
evaluation of internal controls and reducing compliance
risks through risk mitigating activities.
3. Understanding the Compliance and Audit Committee functions, including
oversight of ethics, risk and compliance, as well as
risk mitigation matters.
B. The foregoing attributes must have been acquired through any one or more of the following:
1. Education and experience as an Ethics and Compliance Officer or experience in one or
more positions that involve the performance of similar functions;
2. Experience actively supervising such a position or person performing similar functions;
3. Experience overseeing or assessing the performance of companies with respect to their compliance, ethics or risk function, or
4. Other relevant education and experience.
V. Description of the Role of the Compliance
Advisor
A. The Compliance Advisor to the Committee on Compliance and Audit
is to provide advice and consultation to the Committee
in the following areas:
1. Ethics, compliance and risk matters, including assistance in reviewing UC reports to the
Committee regarding ethics, compliance and identification of risks and risk mitigation activities.
2. Advice and review of appropriate metrics for assessing compliance within the University.
3. Independent review of management's compliance with the University's corporate ethics, risk and compliance programs.
4. General assistance with review of overall performance of the Senior Vice President-Chief Compliance and Audit Officer.
5. General assistance with the Committee on Compliance and Audit's oversight of the University's corporate ethics and compliance program.
The Regents of the University of California
