End of Year Housekeeping for Communicators

We are a mere two weeks away from the end of the current fiscal year, which means it is an ideal time for our communications colleagues to take stock of the purchases incurred over the past year and those budgeted for the coming year and to complete a little bit of end of the year housekeeping.

As we all know, purchases that raise questions about their appropriateness or are of a dollar amount that allow campus constituents, government officials, taxpayers or board members to raise questions are ideal content for media coverage. Inevitably, you will be tasked with communicating expenditures that may be legitimate but look less so without additional information.

Avoid being caught off guard by a reporter’s call by doing a little bit of year-end housekeeping:

• Ask each member of the cabinet and the president for a list of their five largest purchases made in the past year.
• Query if they have approved any expenditures they worried would raise questions from campus constituents. Spend time reviewing each purchase, what process was used for reviewing the vendors and service providers, and the descriptions of the service or product bought. Inquire if the university’s procurement procedures were followed and ask for context if the purchase was completed outside of the traditional purchasing route.
• Question how the purchases and/or vendors were or will be evaluated to ensure they deliver what was promised and if that information will be available to the campus community.
• Consider if the purchase genuinely ties to the strategic plan, mission of the institution or major initiative on campus. If there is no genuine connection to a core service, offering or function of the institution, then dig in further to find its benefit.
• If you have any red flags raised during your due diligence process, conduct an online search for the vendor or service and see how other campuses have discussed them and how the campus community reacted to the purchases.

Communications scenarios in higher education are rarely unique and we can learn from the experiences of our peers (and the online comments they received).

And know that scrutiny isn’t unique to purchases. Delve into your institution’s salaries, salary increases and other compensation information. Human resources can provide you with a list of the top salary increases by dollar amount and percentage of total salary. If it is rare for people to have a year-to-year contract, ask for a list of those on campus who have such an agreement. Pull a copy of your institution’s three most recent 990 forms on file with the IRS, and ask your chief finance officer for a copy of the current year’s form when it is ready for filing. Once you have this information, ask the questions you need answered before you can draft clarifying information.

Meet with risk management and ensure conflict of interest forms are up-to-date for your senior officers. Also meet with human resources to confirm any reporting irregularities or familial hirings are documented in accordance with your institution’s policies. If you are ever asked about even an appearance of impropriety, it is helpful to point to policy compliance as a starting point for explaining the situation and clearing up misinformation.

And finally, consider having a background conversation with your student and local media to provide context on the budget and your budget process.

Paul Fain, news editor for Inside Higher Ed, was gracious enough to share insight on how he approaches reporting on expenditures and salaries. His comments follow my questions (questions appear in italics, responses are bolded):

What do you look for when reading an institution’s 990?
We've looked at executive compensation, conflicts of interest, assets, debt and various fine-line disclosures, which often are near the end of the document.

Where do you get your tips on questionable purchases?
Readers are most likely to send us this sort of tip, including people who work at the institution. Sometimes we follow local news coverage.

Can you give an example of an institution that may or may not have had a questionable purchase but their response or lack of response to your questions pushed you to write a piece about them?
A colleague spotted an unusual embezzlement disclosure in a 990, which the college wrote in vague language. This was a while back, when I worked at The Chronicle of Higher Education. The college didn't cooperate when we asked questions, ducking our calls. The CFO committed the crime, which wouldn't have been that uncommon, or interesting to us. But the college's response -- or lack of one -- contributed to why we covered it. And many other new outlets picked up the story, which had some colorful details, unfortunately for the college.

Can you give an example of an institution that did a good job of explaining what might have been a questionable expense?
Several colleges have proactively reached out to us about embezzlement, which typically isn't a national story for us. The sort of spending that catches our attention tends to be something that could be perceived as excessive -- a stadium expansion, a new fitness center, a big presidential raise -- that occurs during a budget crunch. Some colleges do a better job than others in responding to that line of questioning, by telling us their side rather than hoping it will go away.

What else do you think would be helpful to flag for marketing and communications professionals?
The stories that seem to become full-blown crises often revolve around symbols. Buying an expensive olive jar for a president's home isn't a big deal, budget wise, for a major public university. But the symbol of a costly presidential home renovation has taken down many a college CEO, fair or not. 

Before closing out your books for the 2016 year, dig a bit deeper and ask questions necessary for you to do your job. You have two weeks before the start of a new (fiscal) year, but there is quite a bit of background work you should complete before hitting that calendar milestone.