Correction appended: An earlier version of this article stated that a management advisory memorandum is an audit.

Editor’s Note: This article is the first in a series of reports published by the Daily based on management advisory memorandums obtained from the University through the Freedom of Information Act. A management advisory memorandum is a document from the Office of University Audits that is not made immediately public — unlike audits the office performs. The Daily’s request, filed last fall, yielded 119 management advisory memorandums written from 2006 to 2009.

A former University policy for granting complimentary football and basketball tickets to Athletic Department employees included multiple errors, according to an internal University memorandum acquired by The Michigan Daily through the Freedom of Information Act.

A management advisory memo from the Office of University Audits, dated July 24, 2009, informed then-Athletic Director Bill Martin that complimentary season tickets and individual game tickets given to Athletic Department employees should be counted as part of the employee’s taxable income. At the time, the Athletic Department was counting complimentary season ticket packages as part of an employee’s taxable income, but individual game tickets were excluded. The memo also informed Martin of errors on a form that employees were required to fill out to get the tickets.

The memo was sent to Martin as a precautionary measure after an annual audit of the Athletic Department. It was not sent as a response to any National Collegiate Athletic Association violations, University spokesman Rick Fitzgerald said in a recent interview.

“There were no violations,” Fitzgerald said. “(The memo) was in response to what is a routine annual audit that the University Audits does in Athletics. It was a follow up to that routine audit.”

The memo — written by Carol Senneff, executive director of University Audits, Senior Audit Manager Jennifer Vitale and Senior Auditors Lisa Beymer and Megan Mackson — states that tickets for individual games were erroneously excluded from employees’ taxable income.

“Presently, the value of season tickets provided to staff members is included in an employee’s taxable earnings,” the memo stated. “Tickets for individual games, however, are not included. University Audits and the Tax Director have determined that the value of these tickets should be included with an employee’s taxable earnings.”

In an e-mail to the Daily, Fitzgerald clarified the policy by writing that all complimentary individual tickets to sold out games are considered taxable earnings.

“When something is being given away, it intrinsically does not hold the same value as something for which there are limited quantities in high demand,” he wrote. “Since the value of each is significantly different, the tax liability is as well. So, when there are a number of tickets, there is no value. But when a game is sold out, the … market value is different.”

For over 40 years, all Athletic Department employees have had the option of receiving complimentary Michigan football or basketball tickets. Approximately 275 employees elected to receive complimentary season football tickets, while about 90 employees received complimentary season basketball tickets, Fitzgerald reported.

Athletic Department staff members who don’t want to get full-season basketball tickets can choose to take part in an individual game ticket pool, Fitzgerald wrote in the e-mail. As a part of the pool, a select number of tickets are given away on a first-come-first-serve weekly basis for all home games.

Though football tickets are complimentary to all Athletic Department employees, those who are not on the football program’s staff and receive the tickets are required to pay a Preferred Seating Donation — a required donation which individuals who are interested in purchasing select football, basketball and hockey season tickets must make for the right to purchase the season tickets.

To receive the tickets, Athletic Department employees are also required to sign a form recognizing that their use of the tickets will comply with University regulations, Fitzgerald said.

However, the management advisory memorandum identifies an error in the form. The contract did not include a signature line for the employee to declare compliance with NCAA ticket distribution regulations.

“The form used to track employees who sign up for these tickets includes an attestation statement acknowledging that the employees’ use of the tickets will comply with NCAA regulations,” the memorandum states. “The statement begins ‘with my signature, I hereby affirm…’ However, there is no signature line included on the form. The form should be modified so employees can document accountability for their tickets.”

The policy requiring employees to sign the form is, in actuality, a University policy — not an NCAA policy — Fitzgerald said.

“That’s an internal University policy,” Fitzgerald said. “None of this constituted any violation of NCAA regulations.”

The policy was enacted by the University to ensure that Athletic Department employees are not giving or selling their tickets to athletic boosters or recruits, Fitzgerald wrote in the e-mail.

“The recommendation from University Audit to change the form was to simply reinforce the awareness of the ticket policy and ensure all staff members read the document,” Fitzgerald wrote. “The policy has always remained the same.”

Prior to the memorandum’s release, “virtually all” of the forms went unsigned, according to Fitzgerald. A copy of the new form released to the Daily which was introduced in 2009 after the memo was written, states that Athletic Department employees can’t, in accordance with NCAA rules, give their complimentary tickets to student-athletes, recruits and their family members or agents.

The form also lays out the University policy that prohibits the sale of complimentary tickets. Violation of this policy, according to the form, could result in termination of employment or loss of season tickets.

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