ASI board of directors approve the 2017-18 audit report

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ASI Board of Directors meeting
(Alyssa Lopez/ Daily Titan)

The ASI board of directors approved the 2017-18 Associated Students’ audit report prepared by the Guzman and Gray Audit Firm at Tuesday’s board meeting.

Issues were reported by Associated Students’ employees about the retirement pension and post-retirement medical insurances that have been provided to them, said Dave Edwards, Associate Students’ executive director.

Patrick Guzman, Guzman and Gray Audit Firm representative, told the board their pensions were safe.

“This is the liability that has been projected out over the years. It’s very large and it’s getting bigger all the time,” Guzman said. “So far yours is under control.”

An audit report highlights the financial position of an organization by analyzing its liabilities and assets.

Mark Stohs, Cal State Fullerton professor of finance, said liabilities, in a financial sense, are obligations owed to people or institutions who have provided funds or services to a company — in this case, the pension owed to retirees.  

For the board to control liability Guzman recommended that Associated Students not offer the new employees the pension as a separate benefit because it can freeze that benefit for other employees.

Guzman’s firm has highlighted pensions as a liability in past years. The audit firm told Associated Students it was an ongoing expense “you need to get in front of,” Edwards said.

“Smartly, this organization started funding it decades ago,” Edwards said.

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