REPORT DIGEST

ENVIRONMENTAL PROTECTION AGENCY

COMPLIANCE EXAMINATION
FOR THE TWO YEARS ENDED JUNE 30, 2024

Release Date:  July 17, 2025

FINDINGS THIS AUDIT: 18

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 2 -- 2
Category 2:  5 -- 11 -- 16
Category 3:  0 -- 0 -- 0
TOTAL:  5 -- 13 -- 18

FINDINGS LAST AUDIT: 18

State of Illinois, Office of the Auditor
General
FRANK J. MAUTINO, AUDITOR GENERAL

To obtain a copy of the Report contact:
Office of the Auditor General, 400 West
Monroe, Suite 306, Springfield, IL
62704-9849
(217) 782-6046 or TTY (888) 261-2887

This Report Digest and Full Report are also
available on the worldwide web at
www.auditor.illinois.gov


This digest covers the Environmental
Protection Agency’s (Agency) State
Compliance Examination for the two years
ended June 30, 2024. A separate digest
covering the Agency’s financial audit of the
Water Revolving Fund as of and for the year
ended June 30, 2024 was previously released
on February 20, 2025. In total, this report
contains 18 findings, 1 of which was
reported in the Financial Audit.

SYNOPSIS

• (24-2) The Agency’s internal controls over
its voucher processing function were not
operating 	effectively.
• (24-4) The Agency did not have adequate
controls over the administration of its
accounts receivable.
• (24-7)  The Agency did not maintain
adequate controls over its monthly
obligations, expenditures, appropriations,
and revenue reconciliations.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

VOUCHER PROCESSING INTERNAL CONTROLS NOT
OPERATING EFFECTIVELY

The Agency’s internal controls over its
voucher processing function were not
operating effectively during the examination
period.

In order to determine the operating
effectiveness of the Agency’s internal
controls related to voucher processing and
subsequent payment of interest, we tested a
sample of key attributes for proper data
entry. We noted 14 of 140 (10%) key
attributes were not properly entered into
the Enterprise Resource Planning System
(ERP). Additionally, the Agency was unable
to provide support for one voucher tested to
determine whether the 4 (3%) key attributes
were properly entered into ERP.

We also noted the Agency did not timely
approve 1,005 of 23,175 (4%) vouchers
processed totaling $8,446,431. These
vouchers were approved between 31 and 299
days after receipt of a proper bill or other
obligating document. (Finding 2, pages
14-16.)  This finding has been reported
since 2018.

We recommended the Agency design and
maintain internal controls to provide
assurance its data entry of key attributes
into ERP is complete and accurate. Further,
we recommended the Agency timely approve
proper bills and obligations due, approve
vouchers for payment of interest due to
vendors, submit travel vouchers, and
properly record vouchers.

Agency officials stated they accepted the
recommendation.

INADEQUATE CONTROLS OVER ACCOUNTS RECEIVABLE

The Agency did not have adequate controls
over the administration of its accounts
receivable.

Excluding receivables from the Water
Revolving Fund and the Environmental
Protection Trust Fund, the Agency reported
$47.7 million in accounts receivable, of
which $13 million was over one year past due
as of June 30, 2024.

During testing, the auditors noted the
following:

• Two of 40 (5%) accounts receivable tested,
amounting to $222,951, were 13 and 14 years
past due. The Agency had not made active
collection efforts during the examination
period or referred the accounts to the
Comptroller’s Offset System, Department of
Revenue’s Debt Collection Bureau, or the
Attorney General.

• Three of 40 (8%) accounts receivable
tested, totaling $13,869, were placed in the
Comptroller’s Offset System 106 to 5,453
days after the due dates.

• One (3%) receivable was overstated by
$79,646.

• For four of 40 (10%) accounts receivable
totaling $5,109,241, the Agency did not
provide documentation to determine if the
Agency pursued collection efforts. (Finding
2, pages 20-22) This finding has been
reported since 2014.

We recommended the Agency pursue all
reasonable and appropriate procedures to
collect outstanding debts as required by
Agency policies and State laws and
regulations. We also recommended the Agency
maintain records of accounts receivable and
documentation of its collection efforts and
ensure receivables are properly recorded.

Agency officials accepted the recommendation
and stated the Agency has made great
progress on removing old account receivable
balances.

INADEQUATE CONTROLS OVER MONTHLY
RECONCILIATIONS

The Agency did not maintain adequate
controls over its monthly obligations,
expenditures, appropriations, and revenue
reconciliations.

During testing of monthly reconciliations
between the Office of Comptroller and Agency
records, we noted:

• For the Monthly Appropriation Status
Reports:
–  Thirteen of 32 (41%) reconciliations were
reviewed 4 to 110 days late.
–  Eight of 10 fund reconciliations did not
contain documentation of preparation date,
the name of the preparer, or the name of the
reviewer.

• For the Monthly Revenue Report:
–  The Agency did not perform
reconciliations for two of 21 funds, while
the remaining 19 funds were missing
reconciliations for one to 18 months.
Additionally, all funds had no documentation
of supervisory review for one to 11 monthly
reconciliations.
–  Seven of 24 (29%) monthly reconciliations
were reviewed 13 to 89 days late.

• For the Monthly Cash Reports:
–  Twenty-one of 24 (88%) required monthly
reconciliations did not contain
documentation of preparation date, the name
of the preparer, or the name of the
reviewer.
–  Seven of 46 (15%) fund reconciliations
were not performed for June of 2023 or 2024.
–  One of 24 (4%) reconciliations was
reviewed 19 days late.

• For the Monthly Agency Contract Report or
Monthly Obligation Activity Report:
–  Three of 24 (13%) reconciliations did not
contain the date the reconciliations were
completed, reviewed, or the reviewer.
(Finding 7, pages 29-31) This finding has
been reported since 2018.

We recommended the Agency ensure monthly
reconciliations of obligations,
expenditures, appropriations, and revenues
are performed and documentation of the
timely completion and supervisory review of
its reconciliations are maintained.

Agency officials accepted the
recommendation.

OTHER FINDINGS

The remaining findings pertain to internal
controls over vehicles, personal services,
awards and grants, fees, property, statutory
mandates, information technology, internal
audits, and contractual services. We will
review the Agency’s progress towards the
implementation of our recommendations in our
State compliance examination.

AUDITOR’S OPINION

The auditors stated the financial statements
of the Agency’s Water Revolving Fund as of
and for the year ended June 30, 2024 are
fairly stated in all material respects.

ACCOUNTANT’S OPINION

The accountants conducted a State compliance
examination of the Agency for the two years
ended June 30, 2024, as required by the
Illinois State Auditing Act.  The
accountants qualified their report on State
compliance for Findings 2024-001 and
2024-002.  Except for the noncompliance
described in these findings, the accountants
stated the Agency complied, in all material
respects, with the requirements described in
the report.

This State compliance examination was
conducted by Roth & Company LLP.

COURTNEY DZIERWA
Division Director

This report is transmitted in accordance
with Section 3-14 of the Illinois State
Auditing Act.

FRANK J. MAUTINO
Auditor General

FJM:lkw