|
Appropriation expenditure exceptions
Inaccurate property records
Inaccurate property reporting
Receipt and refund ledgers were not maintained
Vouchers were not approved in a timely manner
Supporting financial information was not maintained |
FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
NONCOMPLIANCE WITH APPROPRIATION ACTS
The Department did not comply with certain provisions of its Appropriation Acts.
In FY 1998, the Department was appropriated spending authority for the Administrative
Division through the General Revenue Fund. In addition, the Department received a lump sum
appropriation for the Compliance Division through the General Revenue Fund for the
reduction of backlogged cases.
We noted 6 of 25 vouchers tested totaling $3,945 that were charged to the Compliance
Division which were not directly related to the appropriation for reduction of backlogged
cases. These vouchers were for travel related expenses of the Administrative Division
whose travel appropriation was fully expended, lapsing only $2. The Department did have
available the 2% transfer authority to incur and expend these costs within the
Administrative Division. (Finding 1, page 16)
We recommend the Department comply with the specific purpose established in the
language of the appropriation acts.
Department officials accepted the recommendation and stated they will seek approval to
combine all administrative operating line items into one departmental division.
INADEQUATE CONTROL OVER PROPERTY
The Department did not maintain adequate control over property.
While the control over property has improved since the prior audit, the Department
still has not fully maintained adequate control over property in regard to physical
property control, property record keeping, and property reporting. We noted the following:
- One out of 11 vouchers for equipment purchases examined was omitted from the
Department's property control records.
- Two out of 30 property items that were located in the Department could not be found on
the property control records.
- Property additions were late in being added to the property control records and were
listed as additions in the wrong quarter when reporting to the State Comptroller.
- The Department did not reconcile its property additions to the State Comptroller's
Expenditures Report. (Finding 2, page 17)
We recommended the Department maintain, record and report property as required by the
State Property Control Act, the Illinois Administrative Code, and the Statewide Accounting
Management System's policies and procedures.
The Department officials accepted the recommendation and stated that additional staff
has been hired and internal controls implemented to ensure accountability over fixed
assets.
INADEQUATE CONTROL OVER RECEIPTS AND REFUNDS
The Department did not maintain adequate records for receipts and refunds.
While some improvements were noted in cash receipts and refunds from the prior audit,
the Department still needs to further strengthen its internal controls over the deposits
of cash and refunds into the State Treasury. Among other things, the Department failed to
maintain receipt and refund ledgers documenting the date of receipt, the purpose and the
amount. (Finding 3, pages 18-19)
We recommended the Department follow the Statewide Accounting Management System
procedures and internal guidelines to ensure that receipts are properly recorded and
deposited and that reconciliations are properly performed.
The Department officials accepted the recommendation and stated additional internal
controls have been developed to ensure that receipts are properly recorded and deposited.
Also, monthly reconciliations are being reviewed for correctness.
INADEQUATE CONTROL OVER VOUCHER PROCESSING
The Department did not have adequate control over voucher processing.
We noted the following:
- Forty-two of the 213 (19.7%) vouchers we tested, totaling $135,698, were not approved
within 30 days from the receipt of the vendor's invoice.
- One hundred and twenty-nine of 213 (60.6%) vouchers tested totaling $265,707 were not
date stamped; therefore, we were unable to determine the timeliness of voucher approval.
- One hundred and thirty-six of 213 (63.8%) vouchers we tested were not approved by the
receiving officer and/or agency head.
- Other incidences of voucher processing errors we noted were (1) lack of supporting
documentation (1.9%), (2) missing vouchers (1.8%), (3) missing vendor invoice number (1%),
and (4) missing voucher date (2%).
Untimely processing and approval of vouchers result in increased cost to vendors and to
the State along with loss of credibility with vendors. Failure to ensure that vouchers are
reviewed and approved by agency officials could lead to misappropriation of resources and
unnecessary expenditures of both State and Federal funds. (Finding 4, pages 20 and 21) This
finding has been repeated since 1995.
We recommended the Department follow its established system of internal control
over voucher processing and devote sufficient resources to properly monitor and supervise
the process.
Department officials accepted the recommendation and indicate that procedures have been
updated and controls implemented to monitor and correct errors. (For previous Department
response, see Digest footnote.)
INADEQUATE SUPPORT FOR YEAR-END FINANCIAL INFORMATION
The Department did not maintain adequate supporting documentation for reported
year-end financial information.
The Department was unable to readily provide supporting documentation for year-end
amounts reported to the Office of the Comptroller for the General Revenue and Special
Projects Division Funds. (Finding 99-5, pages 22 and 23)
We recommended the Department maintain necessary supporting schedules and document all
calculations made during the preparation of year-end financial information.
Department officials accepted the recommendation and stated they will keep adequate
records so that a complete and accurate GAAP package can be prepared.
OTHER FINDINGS
Other findings involved issues such as deficiencies in internal control over
telecommunications costs, incorrectly reporting the Agency Workforce Report, and problems
with maintenance of complete and accurate personnel files. These findings and
recommendations are being given attention by the Department's management. We will review
progress toward implementation of our recommendations during our next audit.
Responses to the recommendations were provided by Maria Ulmer, Fiscal Officer for the
Department of Human Rights.
AUDITOR'S OPINION
Our auditors state the financial statements for the Illinois Department of
Human Rights as of and for the two years ended June 30, 1999 are fairly presented in all
material respects.
___________________________________
WILLIAM G. HOLLAND, Auditor General
WGH:SES:vh
AUDITORS ASSIGNED
Our special assistant auditors for this audit were Parker & Meltzer,
Certified Public Accountants.
Digest Footnotes
INADEQUATE CONTROL OVER VOUCHER PROCESSING - (Previous Department Response)
1997: The Department agrees as recommended by the Auditors. The Department will
establish a more stringent policy in order to strengthen controls over voucher processing.
1995: The Department agrees with the recommendation. But, the receipt of federal funds
are not always timely for payment of vendors within 30 days. Therefore, for internal
control, invoices are not approved or paid until funds are available for expenditure.
This avoids vouchers being processed and returned by the Comptroller's Office because
monies are not available in the appropriate expenditures line. In the future, the
Department will make every effort to approve and pay vouchers within 30 days.
|
