N.M. Admin. Code § 5.3.11.18 - REMOVAL OF EFOP STATUS
A. The
EFOP status of an institution shall remain in effect until the department
determines the risk factor(s) that led to the status have been substantially
mitigated or eliminated. Once the department determines EFOP status may be
removed, a letter issuing notice of removal from EFOP status will be sent from
the department cabinet secretary to the president of the institution, the chair
of the governing board, the chief financial officer of the institution, and any
other entity that was previously notified when the EFOP status was initiated.
The notice of removal from EFOP status will include the specific criteria
utilized by the department in its determination to remove EFOP status. Examples
of conditions supporting removal of the EFOP status may include, but are not
limited to the following:
(1) material
improvement in the fiscal stability of the institution as documented in
financial reports; or
(2)
demonstration that fiscal controls have been implemented and are functioning
adequately as shown by:
(a) the institution's
ability to produce materially accurate and complete financial statements and
reports of account balances and transactions; and
(b) audit opinions which are no longer
modified, qualified, adverse, or disclaimed.
B. The EFOP seeks to ensure that potential
problems of finance are substantially mitigated or eliminated in a timely
manner as demonstrated by fiscal liquidity, strong internal controls and
substantial mitigation or elimination of any risk factor(s) that led to the
EFOP status. In making its determination to remove an institution from EFOP
status the department will consider progress made toward substantially
mitigating or eliminating the risk factor(s), ability of the institution to
implement its corrective action plan, measures taken by the institution to
sustain efforts made through the corrective action plan, and the fiscal outlook
for the institution.
Notes
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