REPORT DIGEST

OFFICE OF THE GOVERNOR

COMPLIANCE EXAMINATION
FOR THE TWO YEARS ENDED JUNE 30, 2023

Release Date:  July 18, 2024

FINDINGS THIS AUDIT: 12

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 6 -- 6
Category 2:  2 -- 4 -- 6
Category 3:  0 -- 0 -- 0
TOTAL:  2 -- 10 -- 12

FINDINGS LAST AUDIT: 11

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

INTRODUCTION

Because of the significance and
pervasiveness of the findings described
within the report, we (West and Co., LLC)
expressed an ADVERSE OPINION on the Office’s
compliance with the specified requirements
which comprise a State compliance
examination.  The Codification of Statements
on Standards for Attestation Engagements
(AT-C § 205.74) states a practitioner
“should express an adverse opinion when the
practitioner, having obtained sufficient
appropriate evidence, concludes that
misstatements, individually or in the
aggregate, are both material and pervasive
to the subject matter.”

SYNOPSIS

• (23-1) The Office lacked adequate controls
over the Illinois Governor’s Mansion
property and receipts.
• (23-2) The Office did not make all
required appointments to various boards,
commissions, councils, committees, and other
entities to fill vacancies.
• (23-5) The Office did not have adequate
controls over reconciliations of monthly
appropriations, cash receipts, contracts,
expenditures, obligations and cash balances.
• (23-6) The Office failed to maintain
proper controls over its personal services
functions.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

INADEQUATE CONTROLS OVER THE ILLINOIS
GOVERNOR’S MANSION PROPERTY AND RECEIPTS

The Office lacked adequate controls over the
Illinois Governor’s Mansion (Mansion)
property and receipts.

We noted:
• For prior period renovations contracted,
overseen, and funded by the Illinois
Governor’s Mansion Association
(Association), a not-for-profit tax exempt
501(c)(3) organization, the Office lacked
supporting documentation for renovations
recorded and had not performed a
reconciliation between the value of the
Association’s renovations and the Office’s
property records or reports.
• For events held at the Mansion,
coordinated and billed by the Association on
behalf of the Office, the Office lacked
documentation of controls over the charge
and collection of fees for usage of the
facility in order to ensure all fees were
collected for the events held
• Due to the Office’s lack of controls, we
were unable to determine if the fees
reported were accurate and included all fees
charged. As a result, we were unable to
conclude the Office's population records
were sufficiently precise and complete in
order to properly test usage fees. (Finding
1, pages 10-12) This finding has been
reported since 2019.

We recommended the Office:

• Evaluate the procedures and strengthen the
controls over property and equipment
purchased by the Association and then
donated to the State, to ensure accurate
record keeping and reporting of all State
assets;
• Ensure balances reported on the Form C-15
accurately reflect Office records;
• Maintain adequate records and
documentation of Office property activities;
and,
• Ensure controls are implemented and
documented to ensure all fees collected by
the Association on behalf of the Office are
remitted

The Office accepted this finding and stated
that in response to the previous examination
the Office reviewed procedures and made
changes to increase compliance. The Office
further responded it will continue to review
the procedures surrounding property and
equipment acquisition and the transfer of
property to the State and will implement
additional procedures as necessary to
reconcile any differences between the
Office’s and the Association’s records.  In
addition, the Office stated it will maintain
current records related to property
activity, incorporate additional records to
clarify activities related to property
management, and continue its efforts to
ensure records accurately reflect rental fee
income.

APPOINTMENTS OF MEMBERS TO BOARDS,
COMMISSIONS, COUNCILS, AND COMMITTEES

The Office of the Governor (Office) did not
make all required appointments to various
boards, commissions, councils, committees,
and other entities to fill vacancies.

We requested the Office to provide a listing
of all statutory mandates in effect during
the examination period, and noted the Office
did not identify 36 applicable laws with
specific mandates significant to the Office.
Due to these process and control
deficiencies, we were unable to conclude the
Office’s population records were
sufficiently precise and detailed to fully
test the Office’s compliance with statutory
mandates.

Despite these limitations, we selected
samples of mandates identified and noted 44
of 58 (76%) boards, commissions, councils,
and committees tested which were considered
operational by the Office did not have the
required number of Governor-appointed
members. (Finding 2, pages 13-20) This
finding has been reported since 2007.

We recommended the Office take necessary
measures to ensure timely appointment of
qualified members to the boards,
commissions, councils, committees, and other
entities as required by statute or seek
legislative remedy.

The Office accepted this finding. The Office
stated appointments require a nuanced level
of attention to find candidates who satisfy
the specific statutory requirements of over
4,500 positions on nearly 400 entities.
Management further stated the Office
prioritizes the appointment of members to
regulatory boards and those boards that have
insufficient numbers of sitting members to
transact business because they do not have a
quorum. The Office noted that individuals
serving in expired terms on non-Senate
confirmed entities are almost always able to
hold over after their statutory terms have
ended and until additional appointment
action can be taken, and remain authorized
to exercise the duties of the position and
may continue to transact business on behalf
of the state as de facto.

INADEQUATE CONTROLS OVER MONTHLY
RECONCILIATIONS

The Office did not have adequate controls
over reconciliations of monthly
appropriations, cash receipts, contracts,
expenditures, obligations and cash balances.

We tested Fiscal Years 2022 and 2023
reconciliations between the Office of
Comptroller (Comptroller) records and the
Office’s records.  Some of the exceptions
noted include:

Monthly Appropriations Status Reports
• Fourteen of 28 (50%) Monthly
Appropriations Status Reports (SB01)
reconciliations did not include
documentation of a review by an independent
person.
• Five of 28 (18%) SB01 reconciliations were
not provided.
• Nine of 28 (32%) SB01 reconciliations were
completed 1 to 445 days late.
• The Office did not correct their records
for net differences noted within the SB01
reconciliations.

Cash Reports
• Seventy-two of 72 (100%) Cash Report
(SB05) reconciliations lacked sufficient
documentation indicating a proper
reconciliation was conducted. Thirty-three
(46%) of the 72 SB05 reconciliations were
not completed at all by the Office.
• Fifteen of 72 (21%) SB05 reconciliations
did not include documentation of a reviewer.

Agency Contract Reports and Obligation
Activity Reports
• The Office did not perform 18 of 28 (64%)
reconciliations for Fiscal Years 2022 and
2023.

Monthly Revenue Status Reports
• Seventeen of 24 (71%) Monthly Revenue
Status Report (SB04) reconciliations tested
did not include documentation of a review by
an independent person.
• Ten of 24 (42%) SB04 reconciliations
tested were prepared 5 to 616 days late.
• A reconciliation did not identify a
$10,000 overstatement on the Office’s
records.
• Five of 24 (21%) SB04 reconciliations did
not properly identify reconciling in-transit
items. (Finding 5, pages 25-27). This
finding has been reported since 2019.

We recommended the Office implement adequate
internal controls and maintain documentation
demonstrating reconciliations are all
properly performed and reviewed in a timely
manner and discrepancies are investigated,
resolved and reported as required

The Office accepted this finding and stated
it has added “preparer” and “reviewer” staff
to all reconciliations to document the
review by an independent person. The Office
also responded it added an ERP module,
permitting in-transit items be more
accurately reported, and all reconciliations
are now completed via the ERP system.

FAILURE TO MAINTAIN PROPER CONTROLS OVER
PERSONAL SER VICES FUNCTIONS

The Office failed to maintain proper
controls over its personal services
functions. We noted the following:

Personnel Files
We noted one of the 17 (6%) employees we
tested, who separated during the examination
period, remained on the payroll for three
pay periods after separation and was paid
for one of those subsequent three pay
periods. The Office overpaid $3,552 for the
separated employee, which they subsequently
recovered.

Employee Attendance Records

We tested 60 employee’s attendance records
and noted:
• 18 of 60 (30%) weekly timesheets tested
were completed 2 to 161 days late.
• 10 of 60 (17%) timesheets tested were
approved 31 to 178 days after the period
ended.
• 1 of 60 timesheets tested lacked
supervisor approval.
• 14 of 60 (23%) employee leave requests
tested were requested 2 to 77 days late,
including 12 requests submitted after leave
was taken.
• 16 of 60 (27%) employee absences were
approved 7 to 211 days after the time was
taken by the employee.

Payroll Withholding
We tested 50 employee’s payroll withholdings
and noted 7 (14%) employees’ federal and/or
state income taxes were withheld at an
incorrect rate.

Employee Training
We tested training records of new hires and
noted 3 of 22 (14%) sampled employees lacked
documentation of timely completion of ethics
training after commencing employment.

Reporting
The Office failed to report the 4 employees
with physical disabilities on the Office’s
Fiscal Year 2021 Agency Workforce Report
(Report) filed during the examination
period. (Finding 6, pages 28-32) This
finding has been reported since 2019.

We recommended the Office establish and
enforce fiscal and administrative internal
controls over its personal services
functions, including:
• Strengthening its controls to ensure
personnel transactions are timely recorded
and reviewed;
• Ensuring employee authorizations for
payroll deductions are entered into the
payroll system timely and correctly;
• Ensuring documentation of employees’
requests and approval of time off is
completed timely;
• Ensuring employees submit and supervisors
approve employee timesheets timely;
• Ensuring employees timely complete initial
required trainings timely; and
• Accurately completing information reported
on the Agency Workforce Reports.

The Office accepted this finding.

OTHER FINDINGS

The remaining findings pertain to statutory
mandates, receipts processing, property,
cybersecurity, voucher processing, the
State’s enterprise resources planning
system, and travel.

We will review the Agency’s progress towards
the implementation of our recommendations in
our next State compliance examination.

ACCOUNTANT’S OPINION

The accountants conducted a State compliance
examination of the Office for the two years
ended June 30, 2023, as required by the
Illinois State Auditing Act.  The
accountants qualified their report on State
compliance for Findings 2023-001 through
2023-006.  Because of the significance and
pervasiveness of the material noncompliance
with the specified requirements described in
these findings, the accountants stated the
Office did not comply, in all material
respects, with the requirements described in
the report.

This compliance examination was conducted by
West & Company, LLC.

JANE CLARK
Division Director

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

FRANK J. MAUTINO
Auditor General

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