NCAA Agreed-Upon Procedures: Best Practices for DI and DII Programs

Higher education institutions with intercollegiate athletic programs must submit annual reports to the NCAA with financial data detailing operating revenue and expenses related to those programs. As part of this report, colleges and universities with Division I programs are obliged to have agreed-upon procedures (AUPs) performed by a qualified, independent accountant every year. Those with Division II programs must perform AUPs every third year.

In my experience performing AUPs, I’ve seen that most institutions have a small group or a single person that prepares the NCAA report. This group or individual is usually part of the athletic department and tends to “take a stab at” the report and hope that it’s right — which can be a bit frustrating for those in the finance office. Ideally, the report and preparation for the AUPs performance should be a collaborative effort from both departments.

Here’s a simple list of best practices to help your school’s athletic and finance teams work together to generate the most accurate data.

• Assemble a team with representation from the business office and the athletic department. Assign roles in building the report and collecting supporting information. Certain tasks are more aligned with the business office (e.g., gathering detail from the general ledger), and other tasks are better handled by the athletic department (e.g., gathering team rosters).
• Once the NCAA annual workbook is completed, retain the detail data used to populate the revenue and expenses for the AUP engagement. Do this annually.
• Make sure the detail lists trace exactly to the number on the report. In other words, total the detail and use that number for the report.
• Have someone review the detail and documentation utilized in producing the numbers for the workbook. Make sure the detail being supplied for the AUPs matches the reports filed.
• Consider utilizing the NCAA’s reporting categories as your own budgeting categories. They don’t necessarily need to be incorporated into the master budget, but could be included in a separate budget for NCAA purposes only.
• Ticket sales and student fees are revenue categories for NCAA reporting that typically have discrepancies when tested. Consider implementing a process that includes a reconciliation of the number of game tickets sold by type to mitigate this common deficiency. The ticket data should match the revenue recorded by game and the corresponding deposit slips. If it is possible, run a report showing the number of students and the number of credits each student is taking so the independent accountant can recalculate the student athletic fees with no exceptions.
• Finally, have an independent employee review the NCAA workbook after you’ve prepared it to make sure it is accurate and complete and that any unusual items have been properly recorded.

How we can help

CLA’s higher education industry professionals have a comprehensive understanding of these procedures and can help your institution interpret and apply them. We can also serve as your independent accountant in performing agreed-upon procedures for NCAA compliance.