FINDINGS, CONCLUSIONS AND RECOMMENDATIONS
INSUFFICIENT DOCUMENTATION FOR RECEIPTS AND
DISBURSEMENTS
In testing of receipts for the local
funds, 2 of 20 items (10%) sampled totaling $1,256 did not have the copy of
the check received nor any supporting documents to identify the nature and
source of the amount received. In
addition, the actual receipt dates were not evident on the available
supporting receipts documents.
In testing of disbursements and expenditures for the local
funds, 1 of 20 items (5%) sampled totaling $242 did not have complete
supporting documents. Also, for all
20 items sampled, only the invoice was presented to initiate processing of
the check payment, and approval for the disbursement was not evident on the
invoices.
Sound internal controls over cash receipts require that
receipts be adequately supported to identify the actual date of receipt and
nature and source of the receipt in order to monitor timeliness and accuracy
of deposits as well as the accuracy of revenue recording. In addition, sound internal controls over
cash disbursements require all disbursements to be adequately supported,
approved by authorized personnel, and have supporting documents properly
canceled at time of signature to prevent duplicate payment. (Finding 04-1,
pages 12-13) This finding is repeated from our 2003 audit.
The Regional Office of Education #24 accepted the
recommendation, responding that changes have already been implemented. Approvals for payment will be noted on
each invoice/supporting document. Copies
of the invoices/supporting documents submitted to the county(ies) will be
made and kept on file. (For previous
Regional Office response, see Digest Footnote #1.)
INADEQUATE SEGREGATION OF DUTIES
The Regional Office of Education #24
did not have adequate segregation of duties for accounting in the local and
distributive funds. The bookkeeper
for the local and distributive funds performs the disbursement functions of
invoice processing, check preparation, custodian of blank checks, recording
transactions, and bank reconciliations.
The bookkeeper also performs the functions of collecting cash and
depositing and recording of cash receipts.
Sound internal controls require adequate segregation of
duties to ensure that effective checks and balances are in place to minimize
the risk of loss. (Finding 04-2, page 14) This finding is repeated from our 2003 audit.
The Regional Office of Education #24 accepted the
recommendation, noting that the Regional Office has limited staff to provide
for adequate segregation of duties.
However, supervisory controls will be revised to include, where
practical, the recommendations of the auditors. (For previous Regional Office response, see Digest Footnote
#2.)
NONCOMPLIANCE WITH STATE MANDATE
The Regional Office of Education #24 did not comply with a statutory administrative requirement. The Illinois School Code (105 ILCS 5/3-6)
requires the Regional Superintendent to report, in writing, to the county
board on or before January 1 of each year, stating: (1) the balance on hand at the time of the last report, and all
receipts since that date, with the sources from which they were derived; (2)
the amount distributed to each of the school treasurers in his or her county;
and (3) any balance on hand.
The Regional Superintendent is also required to submit, in writing, to
the county board a statement of the condition of the Institute Fund and of
any other funds in his or her care, custody or control. According to the Regional Office, the
annual report was submitted on January 13, 2004 due to the delay in
processing information supporting the report. (Finding 04-3, page 15).
The Regional Office of Education #24 accepted the recommendation
to submit the required report on time.
AUDITORS’ OPINION
Our auditors state the Regional Office of Education #24’s
financial statements as of June 30, 2004 are fairly stated in all material
respects.
_____________________________________
WILLIAM
G. HOLLAND, Auditor General
WGH:KJM:ro
SPECIAL ASSISTANT AUDITORS
Our special assistant
auditors were E.C. Ortiz & Co., LLP.
DIGEST
FOOTNOTES
#1: INSUFFICIENT
DOCUMENTATION FOR DISBURSEMENTS --
Previous Regional Office Response
In
the prior response in 2003, the Regional Superintendent accepted the
recommendation, responding that the Regional Superintendent will approve all
invoices before payment is processed.
Invoices will be marked with the check number or stamped “paid”
subsequent to payment.
#2: INADEQUATE SEGREGATION
OF DUTIES -- Previous Regional Office
Response
In the prior response in
2003, the Regional Superintendent accepted the recommendation, responding that the Regional Office has limited staff
to provide for adequate segregation of duties. Under current work requirements, the Regional Office stated it
is not possible to assign additional duties to staff members nor is it
practicable to assign other duties to the bookkeeper. Consequently, supervisory controls will be
strengthened by implementing periodic checks on cash receipts and deposits as
well as disbursements.
Complete
Regional Office responses to prior findings are available upon request from
the Auditor General’s Office.
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