8



       Q. Selection of Consultant to Study Fiscal Relationship Between the
University of Kentucky and the Commonwealth of Kentucky (PR 11)

       In order to further improve the working relationship between the Common-
wealth's Department of Finance and the University with respect to the disbursement
of appropriated funds both for operations and capital outlay, the Vice President -
Business Affairs and Treasurer of the University of Kentucky and the Commissioner
of Finance recommend that the firm of Peat, Marwick, Mitchell & Company be
employed as a consultant for the study of the fiscal relationships between the Uni-
versity of Kentucky and the Commonwealth of Kentucky.

       Mr. Sam Ezelle questioned the necessity of employing an outside consultant
when both the University and the Commonwealth have their own auditing personnel
who should be qualified to conduct such a study. Governor Breathitt agreed that
careful study should always be given to the expenditure of funds for studies. He felt,
however, that this particular study would be most helpful to the next Governor and
the next Commissioner of Finance as they undertook the preparation of the budget.
The fact that the study would be performed by an outside agency would make it of
greater value in such a situation.

       There being no further discussion, Mr. Milner moved that the Vice President -
Business Affairs and Treasurer be authorized to enter into a contract with the firm of
Peat, Marwick, Mitchell & Company, Certified Public Accountants, for a study of the
fiscal relationship between the University of Kentucky and the Commonwealth of
Kentucky, and render a report for a fee of not more than $35, 000, including expenses,
and that Restricted Fund Balances be used to finance the study. The motion was
seconded and passed unanimously.  (See PR 11 at the end of the Minutes. )


       R. Selection of Firm for Management Advisory Services in Connection with
Implementation of Hospital Information and Control System (PR 12)

       Phase I of the Hospital Audit by Haskins & Sells has been completed and a
report of recommended changes in fiscal policies and procedures has been rendered.
The implementation of the proposed changes requires an outside advisor to co-
ordinate the various steps involved because the University does not have the staff
needed to implement and define the new systems and cannot get such a staff fast
enough.

       On motion by Dr. Denham, seconded by Mr. Hillenmeyer, and passed, the
Vice President - Business Affairs and Treasurer was authorized to enter into a
special contract with the firm of Haskins & Seils, Certified Public Accountants, for
management advisory services to be rendered in connection with the implementation
of the Hospital Information and Control System set forth in the report dated
December 27, 1966 and that fees, including expenses, in an amount not to exceed
$60, 000 be appropriated from reserve funds in the General Funds budget established
for the University Hospital.