For the Year Ended:
June 30, 1998

Release Date:
May 20, 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 University did not follow consistent and timely procedures when performing and valuing the year-end Physical Plant inventory.

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

FY 1998

FY 1997

$41,870,386
35,465,517
14,396,019
3,041,796
22,970,297
16,677,894
$134,421,909


$46,115,457
502,603
8,443,291
9,120,917
11,060,402
11,282,208
9,800,671
6,852,865
24,236,704
436,893
$127,852,011

$39,677,598
33,316,662
10,529,023
3,255,387
20,942,584
14,164,570
$121,885,824


$43,899,062
501,437
7,371,304
8,601,095
9,972,734
9,554,507
8,426,218
6,321,284
25,639,003
524,186
$120,810,830

JUNE 30, 1998

JUNE 30, 1997

$37,080,391
$177,999,954
$16,246,173
$42,971,657

$(7,884,862)
$3,358,961
$4,729,334
$376,090
$149,101,823

$33,101,065
$169,065,247
$16,087,991
$43,826,126

$(12,218,258)
$2,087,131
$4,440,342
$373,785
$139,909,349

FY 1998

FY 1997

10,391
$7,737

10,299
$7,192

In 5 of 25 (20%) of inventory items the physical count amounts did not agree to the computer system

The University did not follow consistent and timely procedures when performing and valuing the year-end Physical Plant Inventory. We noted several issues during our audit testing, including:

• The physical inventory was performed timely, but the value was not determined until October, 1998 at which time a $218,570 adjustment was made to reduce the amount originally included in the June 30, 1998 financial statements.
• All eight departments in the Physical Plant inventory used a different method to perform the year-end physical count.
• Prices used to value inventory were not consistently updated and applied to the number of items counted.
• In five of 25 inventory items sampled, the physical count amounts did not agree to the amounts in the computer system.

We recommended the University establish written procedures for the Physical Plant that describes the importance of and procedures for the year-end physical inventory. We also recommended standard inventory count sheets and pricing procedures be used for each of the eight departments within the Physical Plant. (Finding 98-1, pages 24-25)

University officials responded that a draft policy emphasizing the importance of and need for the year-end physical inventory has been prepared. They also stated specific detailed procedures are being developed for the eight departments within the Physical Plant.

The remaining findings are less significant and are being given appropriate attention by the University. We will review progress toward implementing these recommendations in our next audit. Responses to the recommendations were provided by Mr. Marlyn Finley, Director of Business Services/Treasurer.

Our auditors state the University’s financial statements for the year ended June 30, 1998 are fairly presented.

____________________________________
WILLIAM G. HOLLAND, Auditor General

WGH:BAR:pp

Kerber, Eck & Braeckel LLP were our special assistant auditors on this engagement.