1. ©2005 Larson, Allen, Weishair & Co., LLP 1 Minnesota State Colleges & Universities November 8, 2005

2. ©2005 Larson, Allen, Weishair & Co., LLP 2 Agenda Audit scope and results Required communications Testing of internal controls Substantive testing Reliance on other auditors Difficult balances Fraud risk areas and procedures

3. ©2005 Larson, Allen, Weishair & Co., LLP 3 Audit Scope and Results Audited by LarsonAllen — Century College — Minnesota State University, Mankato — Minnesota State University, Moorhead — Winona State University Results — Clean opinions on financial statements — Clean reports on internal controls over financial reporting and compliance with regulations, grant agreements, etc.

4. ©2005 Larson, Allen, Weishair & Co., LLP 4 Required Communications Auditor Responsibility Other Information in Documents Containing Audited Financial Statements Significant Accounting Policies Significant Estimates Significant Audit Adjustments Disagreement with Management Consultations with Other Independent Accountants Issues Discussed Prior to Retention of Independent Auditors Difficulties Encountered in Performing the Audit

5. ©2005 Larson, Allen, Weishair & Co., LLP 5 Testing of Internal Controls Cash receipts / revenues – 40 transactions (tested 40 during the year and 40 after year end at MSU, Moorhead) Cash disbursements / expenses – 40 transactions Payroll disbursements — 40 transactions — Overall analytic of fluctuations to prior year performed by internal auditors

6. ©2005 Larson, Allen, Weishair & Co., LLP 6 Substantive Testing Confirmations — Cash — Investments — Perkins loans receivable — Bonded debt liability — State appropriations revenue — Capital appropriations revenue Tests of Details — Student receivables — Accounts payable — Scholarship allowance — Additions to property, plant & equipment Predictive Analytics — Tuition revenue — Room & board revenue — Sales & service revenue — SEOG, Pell, Perkins, Work Study revenue (agreed to GAPS drawdowns) — Depreciation expense — Deferred revenue

7. ©2005 Larson, Allen, Weishair & Co., LLP 7 Reliance on Other Auditors Legislative Auditors — DOF cash — SBI investments — Securities lending — DOER compensated absences — Workers compensation KDV as principal auditor — Property, plant, & equipment additions in Revenue Fund — General IT controls

8. ©2005 Larson, Allen, Weishair & Co., LLP 8 Difficult Balances Compensated absences — Some revisions to total liability — Significant revisions to current vs. long-term portion of liability — Occurred both at the State of Minnesota and at MnSCU levels

9. ©2005 Larson, Allen, Weishair & Co., LLP 9 Fraud Risk Areas (SAS No. 99) Auditors required to assess risk of fraud Inquiries of management Judgmental selection of transactions to test – ranged from 9 to 25 transactions — Look for supporting documentation — Recorded in proper fiscal year — Authorized for disbursement — No exceptions noted Judgmental testing of disbursements to Top 25 vendors – no exceptions noted

10. ©2005 Larson, Allen, Weishair & Co., LLP 10 Thank you for the opportunity to serve Minnesota State Colleges & Universities Questions?