State Legislators Plan To Order Audit Of UW System Foundations

State legislators are hoping to order an audit of the relationship between University of Wisconsin System schools and their private foundations.

The proposed audit comes after the UW System filed a lawsuit against UW-Oshkosh’s former chancellor and former chief business officer in January. The lawsuit alleges the two illegally transferred millions of dollars from the university to the UW-Oshkosh Foundation to fund five projects.

UW System regents argue money should only flow from foundations to schools.

“This audit, if we get it approved, is sort of like preventive maintenance. I don’t think we want to have any more of these embarrassing situations like what happened in Oshkosh,” said Sen. Robert Cowles, a Green Bay Republican and co-chair of the Joint Legislative Audit Committee.

This audit could define the scope and nature of the relationships between UW System schools and private foundations that support schools financially; analyze documents governing these relationships; and identify UW resources that have been provided to support these relationships, according to the audit.

David Gilbert, president of the UW-Milwaukee Foundation, said he wasn’t informed about the proposed audit but said he believes it’s appropriate after what happened in Oshkosh.

“When that happens in one part of the system it would make sense to do an audit and make sure that’s not happening elsewhere,” Gilbert said.

UW System spokeswoman Stephanie Marquis said in a statement that the system is taking an in-depth look into the financial transactions between UW institutions and private foundations during the last seven fiscal years.

“This includes substantiating that all transactions were proper, and contractual relationships with foundations are appropriate,” Marquis wrote in a statement. “The UW System remains accountable to our citizens and lawmakers, and we will work with the Legislative Audit Bureau to assist them however possible, as well as publicly share the results of this extensive review as soon as it is complete.”

The statement said the UW System expects to finish its review within the next few weeks.

The Joint Legislative Audit Committee will have a hearing this Thursday to possibly order the audit.