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Inaccurate information reported to the Office of the State Comptroller
$99,000 understatement reported
$655,000 overstated
reported
$9,000 overstatement reported
Inadequate controls over State property
$140,696 understatement reported to the State Comptroller
Items totaling $143,535 not recorded on Board records
Inadequate controls over personal services function
Informational reports not received timely as required
Board officials state they do not have the power to
enforce timely submissions |
FINDINGS, CONCLUSIONS, AND
RECOMMENDATIONS INADEQUATE CONTROLS OVER GAAP REPORTING The Illinois Community College Board (Board) did not prepare and submit accurate accounting reports (Generally Accepted Accounting Principles (GAAP) reporting forms) to the Office of the State Comptroller. We noted the following: · For the ICCB Contracts and Grants Fund (339), the Board included a FY08 lapse payment of $10,000 and excluded FY07 lapse payments totaling $108,804 causing a cumulative understatement of approximately $99,000 in the amount reported to subrecipients on the Board’s Interfund Activity-Grantee Agency (SCO-567) form. · For the ICCB Adult Education Fund (692), the Board reported $23,571,098 in current year expenditures. However, Board records supported $23,632,000 on the Grant/Contract Analysis (SCO-563) form resulting in an overstatement of approximately $61,000. In addition, Board’s records reported $22,430,836 provided to subrecipients; however $23,086,000 was reported on the SCO-563 form causing an overstatement of approximately $655,000. · For the Career and Technical Education Fund (772), the Board records supported $17,307,195 in current year expenditures; however $17,316,000 was reported on the SCO-567 form resulting in an overstatement of approximately $9,000. In addition, the Board reported $0 to subrecipients on the SCO-567 form; however Board records support $16,754,287 was given to subrecipients for the Career and Technical Education – Basic Grants to States program Catalog of Federal Domestic Assistance (CFDA) #84.048. Lastly, the Board reported $4,028,000 on the SCO-567 form, however, Board records support $3,990,775 was given to subrecipients for the Tech-Prep Education program CFDA #84.243. (Finding 1, pages 10-11) We recommended the Board implement procedures to ensure complete and accurate information is reported to the Office of the Comptroller on the accounting reports. Board management concurred with the finding. PROPERTY CONTROL WEAKNESS The Board did not exercise adequate control over the recording and reporting of its State property. We noted the following: · Two of eight (25%) Quarterly Reports of State Property (C-15’s) prepared by the Board and submitted to the Office of the State Comptroller did not accurately reflect the Board’s equipment transactions. We noted differences resulting in an overall understatement of $140,696. · The Board purchased and received video equipment totaling $92,976 and office furniture totaling $3,392 in May 2008. However, the Board’s property control listing did not include these purchases at the fiscal year end, nor by the end of our testing. In addition, the Board did not accurately include this equipment on the C-15 report submitted to the Office of the State Comptroller for the quarter ended June 30, 2008. · The Board purchased two vehicles totaling $47,167 through a capital lease purchase option. However, the Board did not include these vehicles on the Board’s property control listing, the C-15 reports submitted to the Office of the State Comptroller or on the Annual Inventory Certifications submitted to the Department of Central Management Services (DCMS). In addition, the Board did not accurately complete and submit the Accounting for Leases-Lessee Form (SCO-560) with the Office of the State Comptroller. · Equipment tested, totaling $240,481, was not properly identified. The Board used a four digit identification number for equipment items. · The Board did not maintain a list of items to be sent to surplus. We noted five items, totaling $45,266 which appeared to be obsolete or unused. · Seven of 25 (28%) items purchased were not included on the Board’s property records at the correct amount. Four items did not include installation charges, totaling $2,958, in the valuation price listed on the property records. Two items were recorded on the Board’s records at $1,196 but the actual cost was only $1,131 resulting in an overstatement of $65 for each item. The Board recorded another item on their property records as $8,070; however, the auditor noted the asset’s value to be $7,848, causing an overstatement of approximately $222. · Six of 50 (12%) property items, totaling $4,724, were located within the Board; however, the physical locations differed from the locations specified on the Board’s property records. · One of 25 (4%) property items tested, totaling $35,328, contained several parts and not all items could be located. · The Board’s property records did not indicate both a purchase date and tag and/or inventory date. Therefore, we were unable to determine if property items were added to the Board’s records in a timely manner. (Finding 2, pages 12-14) We recommended the Board strengthen controls over the recording and
reporting of State property by reviewing their inventory and recordkeeping
practices to ensure compliance with statutory and regulatory
requirements. We also recommended the
Board ensure all equipment is accurately and timely recorded on the Board’s
property records and properly tagged. Lastly, we recommended the Board
thoroughly review all reports prepared from internal records for accuracy before submission to the State Comptroller and the
Department of Central Management Services. Board management concurred with the finding. INADEQUATE CONTROLS OVER PERSONAL SERVICES The Board did not have adequate controls over its personal services function. We noted the following:
·
The Board did not conduct employee performance
appraisals for five of 25 (20%) appraisals tested in accordance with the Illinois
Administrative Code (Code) (80 · The Board did not have a distinctive methodology for paying Board personnel. We noted Board personnel were paid from several different funds without a budget or staffing plan to support paying personnel across different appropriated funds and line items throughout the period. · The Board did not properly approve two of 47 (4%) employee work schedules. Board personnel were not able to provide written approval for employees working outside of normal work hours. (Finding 5, pages 18-19) We recommended the Board perform appraisals timely for all employees and maintain a system of record keeping ensuring all evaluations are properly maintained. Furthermore, we recommended Board strengthen controls over employee work hours and documenting justification for personal service expenditures. Board management concurred with the finding. STATE AND FEDERAL GRANT REPORTING BY ILLINOIS COMMUNITY COLLEGE
DISTRICTS The Board failed to enforce compliance with the Rules and Regulations over timely submission of required reports and schedules. We noted: · 129 of 360 (36%) informational reports due in fiscal year 2007 were submitted to the Board between one day and more than 35 months late. Thirteen reports were not received by the end of our fieldwork.
·
109 of 372 (29%) informational reports due in
fiscal year 2008 were submitted to the Board between one day and more than 35
months late. Ten reports were not
received by the end of our fieldwork.
(Finding 7, page 21) This finding was first reported in 1996. We recommended the Board review the adequacy of their policies and procedures regarding the submission of audit reports and other required reports. We further recommended the Board continue to work with each district to ensure required reports are submitted timely.
Board management concurred with the finding but stated the Board does not have any other power to enforce timely submissions other than through continuous follow-up. Board management also stated they will review and see if any other non-monetary methods of enforcements can be used within the statutory guidelines. (For the previous Board response, see Digest Footnote #1.)
OTHER FINDINGS The remaining findings pertain to misallocated grants to community college districts paid from the Base Operating Grants and inadequate controls over contractual agreements and interagency agreements. We will review progress towards the implementation of our recommendations during our next compliance examination. ____________________________________ WILLIAM G. HOLLAND, Auditor General WGH:JSC:pp SPECIAL ASSISTANT AUDITORS The compliance examination was conducted by the Auditor General’s staff. DIGEST FOOTNOTES #1 STATE AND FEDERAL GRANT REPORTING BY
ILLINOIS COMMUNITY COLLEGE DISTRICTS – Previous Board Response 2006: The Board concurs with this finding. The receipt of the audit is necessary to
compute grant amounts for each of the districts. The Board has started a new policy that
either the President or Board Chairman of a college must come before the
Board to explain why the audit report is late. The Board will also look at the other 1,991
reports to determine which ones may be important enough to require Board interaction
with the college. |
