N.M. Admin. Code § 5.3.11.18

Current through Register Vol. 35, No. 21, November 5, 2024

Section 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.

N.M. Admin. Code § 5.3.11.18

Adopted by New Mexico Register, Volume XXIX, Issue 23, December 11, 2018, eff. 12/11/2018