REPORT
DIGEST

DEPARTMENT OF VETERANS' AFFAIRS ILLINOIS VETERANS' HOME AT QUINCY

FINANCIAL AND COMPLIANCE AUDIT
For the Two Years Ended:
June 30, 1998

Summary of Findings:

Total this audit 1
Total last audit 1
Repeated from last audit 0

Release Date:
April 15, 1999


State of Illinois
Office of the Auditor General

WILLIAM G. HOLLAND
AUDITOR GENERAL

To obtain a copy of the Report contact:
Office of the Auditor General
Attn: Records Manager
Iles Park Plaza
740 E. Ash Street
Springfield, IL 62703
(217) 782-6046 or TDD (217) 524-4646

This Report Digest is also available on
the worldwide web at
http://www.state.il.us/auditor

SYNOPSIS

  • The Home did not maintain adequate controls over locally held funds.

{Expenditures and Activity Measures are summarized on the next page.}

 

STATE OF ILLINOIS
DEPARTMENT OF VETERANS' AFFAIRS
ILLINOIS VETERANS' HOME AT QUINCY
FINANCIAL AND COMPLIANCE AUDIT
For The Two Years Ended June 30, 1998

EXPENDITURE STATISTICS

FY 1998

FY 1997

FY 1996

  • Total Expenditures (All Funds) (1)

OPERATIONS TOTAL
% of Total Expenditures

Personal Services
% of Operations Expenditures
Average No. of Employees

Other Payroll Costs (FICA, Retirement)
% of Operations Expenditures

Contractual Services
% of Operations Expenditures

Locally Held Funds
% of Operations Expenditures

All Other Operations Items
% of Operations Expenditures

  • Cost of Property and Equipment

$26,310,108

$26,310,108
100%

$16,770,619
63.74%
566

$2,979,058
11.32%

$1,951,946
7.42%

$745,803
2.84%

$3,862,682
14.68%

$36,152,321

$25,032,499

$25,032,499
100%

$16,242,298
64.88%
566

$2,626,794
10.50%

$1,472,926
5.88%

$771,187
3.08%

$3,919,294
15.66%

$34,738,290

$23,286,442

$23,286,442
100%

$15,505,251
66.58%
555

$2,464,227
10.58%

$1,356,477
5.83%

$606,900
2.61%

$3,353,587
14.40%

$33,649,761

 

SELECTED ACTIVITY MEASURES

FY 1998

FY 1997

Average Number of Employees

566

566

Average Number of Members

577

580

Ratio - Average Number of Employees to Members

1/1.02

1/1.02

Estimated Cost Per Year Per Member

$18,736

$17,453

 

HOME ADMINISTRATOR
During Audit Period: Donald Lynn
Currently: Ronald Frillman (effective July 13, 1998)

(1) Includes all funds except the Members' Trust Fund and the Clearing Account.

 









Funds were not adequately collateralized and disbursement checks lacked required signatures

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

INADEQUATE CONTROLS OVER LOCALLY HELD FUNDS

The Home did not maintain proper internal controls over locally held funds. We noted the following:

  • Twenty-five disbursement checks tested lacked required dual signatures.
  • Certificates of deposit were not adequately collateralized by amounts ranging from $250,000 to $500,000 for four months in FY 97.
  • Federal tax reports were not filed. We noted ten instances where the Home should have prepared and submitted federal forms 1099-MISC to report payments to non-corporate entities in excess of $600. (Finding 98-1, pages 8 and 9)

Home officials agreed with our recommendation to: 1) strengthen controls over locally held funds by adhering to applicable policies and regulations on expenditure approval, recordkeeping and reporting; and 2) monitor the adequacy of collateral for all invested amounts. Their response indicates corrective action has been implemented. The responses to the recommendations were provided by Donald Bullerman, Chief Internal Auditor, Department of Veterans' Affairs.

AUDITORS' OPINION

We conducted a compliance audit of the Home as required by the Illinois State Auditing Act. We also performed certain agreed-upon procedures with respect to the records of the Home to assist our single audit of the entire Department of Veterans' Affairs. Financial statements for the Department and federal reporting are included in the audit report of the Department of Veterans' Affairs - Central Office.



____________________________________
WILLIAM G. HOLLAND, Auditor General

WGH:GSS:pp

SPECIAL ASSISTANT AUDITORS

Our special assistant auditors for this audit were Gray Hunter Stenn, LLP.