The University of Hawaii Board of Regents voted to approve a legal settlement on Wednesday that gave former UH athletic director Jim Donovan a new job within the chancellor’s office.

The 11-4 vote in favor of approving Donovan’s $211,200-per-year marketing job came after the regents were presented an internal audit questioning aspects of the department’s procedures over the last three years of Donovan’s tenure as athletic director.

The audit was requested by Rockne Freitas shortly after he was named interim athletic director in July. Donovan had been put on leave in the aftermath of the apparent Stevie Wonder concert scam and was subsequently reassigned to a post in the chancellor’s office.

"We have to tighten up on our polices and practices," Freitas said. "The answer is enterprise risk management in the athletic department."

When contacted by the Star-Advertiser, Donovan declined to comment. He did not attend the committee meeting.

Freitas hadn’t received a copy of the audit before the meeting of the BOR Committee on University Audits at the UH Campus Center Ballroom. The committee meeting preceded the board’s special meeting to address Donovan’s appointment to his new job.

After voting to approve the settlement the regents issued a statement saying, "We need to put this affair and its aftermath behind us."

The audit was presented to a Board of Regents committee by Glenn Shizumura, the director of UH’s Office of Internal Audit, and noted several practices employed by the department that didn’t conform with department or university policies.

"We definitely take it from that perspective as an opportunity to get better," said associate athletic director Carl Clapp, who addressed regents’ questions during the meeting.

"It’s a healthy process. … By constantly looking at what you’re doing and how you’re doing things there are opportunities to get better. We can learn from this and let’s see what we can adjust to make us a better department."

The audit examined the three athletic department accounts maintained by the UH Foundation — the athletic director’s, athletic administration and UH athletic fund.

It noted Donovan’s previously reported expense reimbursements and noted the "business purpose and potential benefit" of sending five department members to the 2012 Final Four as "questionable."

The audit also noted inconsistencies in policies and procedures in areas such as the use of facilities by outside entities, the operation of the department’s sports camps and travel costs for athletic department personnel. It noted that a lack of written policies and procedures contributed to "inconsistent treatment and handling of facility use arrangements."

The audit found that funds left over from travel advances to athletics personnel were not paid within the 21 days stipulated by UH policy. One such sum of $4,800 went unpaid for more than a year, in another case an excess travel advance of $4,700 was reported stolen from a coach’s safe.

Asked later by a regent about the department’s "checks and balances," Shizumura said, "the control is there but at times the effectiveness of that control has not been there."

Freitas expressed concern over the issue of the summer camps. The audit noted that $78,000 raised over three years through scholarship dinners to defray the cost for participants in UH’s summer football camp was deposited into the UH Foundation account and later transferred to camp accounts. The monies were then distributed to coaches staffing the camps. Head coaches contracts allow for proceeds beyond expenses to be given to the coaches as additional compensation.

The audit also pointed out that waiving fees for camps is prohibited by athletic department policy. It noted that 44 participants at a football camp had their registration fees waived. It was determined 10 were dependents of UH staff and 14 received vouchers. There was no documentation for the other 20.

"We’ve done a lot in the last couple years to put our camps in a better situation compliance-wise but there’s still more work we can do," Clapp said. "We can still get better, no question."

The athletic department also gave out about 8,600 complimentary tickets — worth an estimated $1.3 million, and $660,000 in premium seat contributions — annually for the last three fiscal years. Many were tied to contracts as part of corporate sponsorships.

Bill King, Chief Financial Officer for the UH Foundation, told the committee the foundation’s board of trustees is examining its policies on reimbursements, including establishing dollar limits on travel and meals, with recognition there may be exceptions for events that might incur higher costs.

According to the document, the UH athletic department’s accumulated net deficit increased to $11.3 million for the 2012 fiscal year according to unaudited figures, up from $9.1 million in 2011 and $9.6 in 2010.

Donovan had been put on paid leave in July after the athletic department lost $200,000 in an apparent scam involving a bogus Stevie Wonder concert. He hired attorney David Simons, who threatened to sue the university for defamation.

UH attorneys and Simon agreed to a settlement in which Donovan would leave his $240,000 a year job as UH athletic director. That job would have ended in March when his contract ran out. Donovan agreed to take a $211,200 newly created marketing job in the Chancellor’s Office for three years. His initial salary was reduced to $200,640 because of a temporary pay cut for all senior executives in light of budget problems.

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Star-Advertiser reporter Craig Gima contributed to this story.