Former Oklahoma State President Kayse Shrum has responded to the release of an audit that revealed mismanagement of $41 million in state funds at OSU.
Shrum was only notified of the audit results on Wednesday and said any assumptions that management of funds were under the guidance of legal advice of legal counsel and approved by the board of regents.
“I have been asked to comment on news articles about the release of an internal audit performed on behalf of the Oklahoma State University Board of Regents. I only received a copy of this audit yesterday by reading a news article.
Most importantly, there is absolutely no money missing. No state money has been taken . All of the money is still in OSU accounts and was spent on delivering education and research per the mission of the university.
Second, as President of the University I utilized the legal counsel of the board of regents. The transfer of funds from OSUMA to OSU was approved by the board of regents with input from legal counsel. The research institutes and structure of the Innovation Foundation was presented to the Board of Regents on multiple occasions and the regents have representation on the board of the Innovation Foundation.
Third, I do not have any knowledge that any laws were broken. To my knowledge, absolutely nothing was done that was wrong or inappropriate. My training is as a physician, I am not a lawyer, and I relied upon the same legal advice that the Board of Regents were given.
Any inference that anything was done wrong, based on everything that I know during my tenure as President, is simply not accurate.
As you may know, I am currently on a sabbatical and no longer the President. I am currently acting only as a mother, wife and grandmother of my new grandson.”
Shrum resigned as OSU President on February 3rd, without providing a specific reason. At the time she said she was grateful for the opportunity to lead OSU and that she would always be a part of the Cowboy family.
Under Dr. Shrum’s leadership, OSU saw record enrollment, improved student retention rates, increased research funding, as well as strong philanthropic support. The Board of Regents released as a statement at the time thanking Shrum for her time.
“We extend our deepest gratitude to Dr. Shrum for her dedicated leadership, unwavering commitment to students, and significant contributions to the OSU System,” said the board. “Dr. Shrum has led with passion and vision, championing key initiatives in academics, research, and innovation while advancing OSU’s land-grant mission.”
What Did The Audit Reveal?
The audit determined that a total of $41 million in state funds, received between July 1, 2022, and January 15, 2025, were not adequately restricted. In some instances, these funds were intermixed with other finances, resulting in expenditures that did not correspond with their intended purposes.
These funds were allocated by the Oklahoma Legislature to the Oklahoma State University Medical Authority (OSUMA) for educational and research initiatives at OSU.
The audit details four ways that the mismanaged funds were handled improperly (See Audit Page 4 Below):
◾$11.5 million of the $41M was transferred to the Innovation Foundation, Inc. without a written contract approved by the OSU/A&M Board as required by state law and Board policy. The Innovation Foundation is a research foundation formerly known as the Oklahoma State University Research Foundation.
◾ $20.5 million $41M were “co-mingled with other funds” according to the report, a practice prohibited by OSU policy and accounting standards.
◾ $24 million $41M were deposited into unrestricted auxiliary funds rather than restricted Education & General funds. The Office of Internal Audit indicates that this appears impermissible under state law.
◾ $4 million $41M was deposited into restricted capital funds but was not specified for the restricted purposes
$55.5 million was the total amount of money appropriated to the Cooperative Agreements. The audit was limited to the $41 million of the 55.5M that had been transferred.