REPORT DIGEST

 

REGIONAL OFFICE OF EDUCATION #16

 

DEKALB COUNTY

 

FINANCIAL AUDIT

 

For the Year Ended:

June 30, 2007

 

Summary of Findings:

 

Total this audit                   1

Total last audit                   3

Repeated from last audit    0

 

Release Date:

May 1, 2008

 

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

Iles Park Plaza

740 E. Ash Street

Springfield, IL 62703

(217) 782-6046 or TTY (888) 261-2887

 

This Report Digest and Full Report are also available on

the worldwide web at

http://www.auditor.illinois.gov

 

 

 

 

 

 

 

 

SYNOPSIS

 

·        The Regional Office of Education #16 did not have sufficient internal controls over the financial reporting process.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

             {Expenditures and Revenues are summarized on the reverse page.}

                                                                                   

REGIONAL OFFICE OF EDUCATION #16

DEKALB COUNTY

 

FINANCIAL AUDIT

For The Year Ended June 30, 2007

 

 

 

FY 2007

FY 2006

TOTAL REVENUES

$876,366

$849,288

Local Sources

$105,424

$79,191

% of Total Revenues

12.03%

9.32%

State Sources

$753,587

$760,092

% of Total Revenues

85.99%

89.50%

Federal Sources

$17,355

$10,005

% of Total Revenues

1.98%

1.18%

 

TOTAL EXPENDITURES

$878,638

$847,610

Salaries and Benefits

$231,804

$221,051

% of Total Expenditures

26.38%

26.08%

Purchased Services

$476,964

$467,153

% of Total Expenditures

54.28%

55.11%

All Other Expenditures

$169,870

$159,406

% of Total Expenditures

19.33%

18.81%

 

 

 

TOTAL NET ASSETS

$87,909

$90,181

 

 

 

INVESTMENT IN CAPITAL ASSETS

 

$01

 

$01

 

1  Capital assets of the Regional Office were purchased using the governmental resources of the County.

 

 

REGIONAL SUPERINTENDENT

During Audit Period:  Honorable Gilbert E. Morrison, Jr.

Currently: Honorable Gilbert E. Morrison, Jr.
 

 

 

 

 

 

 

 

 

 

The Regional Office of Education #16 did not have sufficient internal controls over the financial reporting process.  



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

 

 

Controls Over Financial Statement Preparation

 

         The Regional Office of Education #16 is required to maintain a system of controls over the preparation of financial statements in accordance with generally accepted accounting principles  (GAAP).  Regional Office internal controls over GAAP financial reporting should include adequately trained personnel with the knowledge and expertise to prepare and/or thoroughly review GAAP based financial statements to ensure that they are free of material misstatements and include all disclosures as required by the Governmental Accounting Standards Board (GASB).

 

         The Regional Office of Education #16 did not have sufficient internal controls over the financial reporting process.  The Regional Office maintains their accounting records on the cash basis of accounting. While the Regional Office maintains controls over the processing of most accounting transactions, there are not sufficient controls over the preparation of the GAAP based financial statements sufficient for management or employees in the normal course of performing their assigned functions to prevent or detect financial statement misstatements and disclosure omissions in a timely manner. For example, auditors, in their review of the Regional Office’s accounting records, noted the following:

 

  • The Regional Office did not maintain adequate internal controls over the processing of all financial transactions and numerous adjustments were required to present financial statements in accordance with generally accepted accounting principles.

 

  • The Regional Office did not have adequate controls over the maintenance of complete records of accounts receivable and accounts payable.

 

  • The Regional Office did not have the ability to prepare accurate financial reports on the fund basis of accounting.

 

         The auditors recommended that, as part of its internal control over the preparation of its financial statements, including disclosures, the Regional Office of Education #16 should implement a comprehensive preparation and/or review procedure to ensure that the financial statements, including disclosures, are complete and accurate.  Such procedures should be performed by a properly trained individual(s) possessing a thorough understanding of applicable generally accepted accounting principles, GASB pronouncements, and knowledge of the Regional Office of Education’s activities and operations. (Finding 07-1, pages 9-10)

 

         The Regional Office of Education #16 responded that it understands the nature of this finding and realizes the circumstance is not unusual in an organization of this size.  The Regional Office accepts the degree of risk associated with this condition because the added expense of seeking additional accounting expertise to prepare and/or review financial statements would take away from the funds available to provide educational services for the schools in the region.  The Regional Office noted it will continue to do the best it can with the resources it has. 

 

AUDITORS’ OPINION

 

         Our auditors state the Regional Office of Education #16’s financial statements as of June 30, 2007 are fairly presented in all material respects.

 

 

 

_____________________________________

WILLIAM G. HOLLAND, Auditor General

 

WGH:KJM

 

SPECIAL ASSISTANT AUDITORS

 

         Our special assistant auditors were Clifton Gunderson, LLP.