Fresno State Foundation Outlines Reforms After Audit Flags 46 Problem Areas

A highly critical 32-page audit from CSU Audit and Advisory Services found 46 areas requiring remediation at the Fresno State Foundation, prompting the university to unveil a sweeping set of reforms aimed at restoring trust and tightening financial oversight. While auditors found no malfeasance or fraud, the report stated that vulnerabilities and operational inefficiencies increased the Foundation's exposure to financial misstatement and fraud, touching everything from governance and board operations to budget and financial practices.

Among the most striking findings: some Foundation accounts were being balanced and reconciled only once a year. Fresno State president Saúl Jiménez-Sandoval said the university had already moved to address that gap, establishing monthly bank reconciliation processes to strengthen banking controls. In a statement released alongside the audit, Jiménez-Sandoval said the university and Foundation had already taken corrective steps and outlined priorities to modernize governance structures and strengthen oversight of the Foundation.

The reforms span five areas. On governance and board structure, the Foundation plans to revise board composition to ensure appropriate university representation, establish term limits for board members and officers, update bylaws to reflect current leadership roles and reporting structures, and align audit committee composition with regulatory requirements.

Under roles, responsibilities, and agreements, the Foundation will update management service agreements to reflect current services and costs and establish standardized methodologies for fee calculations and reconciliations.

Financial controls and oversight reforms include strengthening segregation of duties across banking and financial systems, implementing regular fund balance reconciliations, and ensuring timely and complete bank reconciliations for all accounts, the last of which the monthly reconciliation process has already begun to address.

The trust accounts and stewardship category calls for enforcing timely renewal of trust account agreements and implementing monitoring plans to ensure donated funds are used in a timely manner and as intended by the philanthropic partner. That commitment to donor stewardship carries weight for a Foundation that manages philanthropic relationships central to university funding and operations.

On endowments and financial reporting, the reforms include improving endowment valuation reporting frequency, revising administrative fee structures to align with best practices, standardizing income distribution methodologies, and strengthening indirect cost recovery allocation transparency.

No completion timelines for the remaining 46 remediation items were provided in the materials released alongside the audit. The full report from CSU Audit and Advisory Services contains the complete list of findings, and the pace at which the Foundation implements the outlined reforms will determine whether the corrective momentum Jiménez-Sandoval described translates into lasting structural change.