REPORT DIGEST

REGIONAL OFFICE OF EDUCATION #40

CALHOUN/GREENE/ JERSEY/MACOUPIN COUNTIES

FINANCIAL AUDIT

(In Accordance with the
Single Audit Act and OMB Circular A-133)

For the Year Ended:

June 30, 2004

Summary of Findings:

Total this audit                          3

Total last audit                          3

Repeated from last audit           2

Release Date:

April 13, 2005

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 is also available on

the worldwide web at

http://www.state.il.us/auditor

SYNOPSIS

·        The Regional Office of Education did not comply with certain statutory administrative requirements.

·        Expenditure reports for the period ended June 30, 2004 for three grants were not submitted to the Illinois State Board of Education in a timely manner.

·        In two instances, expenditure reports submitted to the State Board of Education did not agree to the Regional Office of Education #40’s general ledger. 

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

FY 2004

FY 2003

TOTAL REVENUES

$1,584,188

$1,739,647

Local Sources

$383,574

$390,469

% of Total Revenues

24.21%

22.45%

State Sources

$673,239

$1,021,116

% of Total Revenues

42.50%

58.70%

Federal Sources

$527,375

$328,062

% of Total Revenues

33.29%

18.86%

TOTAL EXPENDITURES

$1,687,708

$1,780,507

Salaries and Benefits

$1,161,462

$1,285,144

% of Total Expenditures

68.82%

72.18%

Purchased Services

$334,378

$334,102

% of Total Expenditures

19.81%

18.76%

All Other Expenditures

$191,868

$161,261

% of Total Expenditures

11.37%

9.06%

TOTAL NET ASSETS¹

$364,674

$468,194

INVESTMENT IN CAPITAL ASSETS¹

$65,580

$84,492

1         In fiscal year 2004, Regional Offices of Education implemented Government Accounting Standards Board (GASB) Statement No. 34 which established a new financial reporting model for state and local governments.  Government-wide financial statements are prepared using full accrual accounting that reports Total Net Assets.  The fiscal year 2003 ending general fixed assets have been restated to reflect the changes required as part of the implementation of GASB Statement No. 34.

              Percentages may not add due to rounding.

REGIONAL SUPERINTENDENT 

During Audit Period: Honorable Larry D. Pfeiffer

Currently:  Honorable Larry D. Pfeiffer

The Regional Office of Education #40 did not comply with certain statutory administrative requirements.

Expenditure reports for the period ended June 30, 2004 for three grants were not submitted to the Illinois State Board of Education in a timely manner.

In two instances, expenditure reports submitted to the State Board of Education did not agree to the Regional Office of Education #40’s general ledger. 

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

COMPLIANCE WITH STATUTORY REQUIREMENTS

      The Regional Office of Education #40 did not comply with certain statutory administrative requirements.  For example, 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 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 required report was not submitted by the Regional Office.  According to Regional Office management, they were unaware of the statute. 

      State statute (105 ILCS 5/3-11.5) also requires that the regional superintendent of schools constitute a regional professional development review committee to advise the regional superintendent and to hear appeals relating to the renewal of teaching certificates.  According to Regional Office management, they were unaware of the statute.

      Finally, the Illinois Administrative Code (23 Ill. Adm. Code 110.115) states that fees for conferences, workshops, materials and other costs charged for discretionary activities not required by law or rule are to be determined on a cost-recovery basis.  Excess funds resulting from registrations or requests for materials/services beyond the anticipated cost-recovery basis shall be deposited in an Enterprise Fund to be used solely to reduce the cost of similar items or to cover costs incurred due to less-than-anticipated registrations or requests for materials/services. 

      The Regional Office’s Administrators’ Academy Fund, which accounts for workshops, had a fund balance of $23,374 and $22,090 as of June 30, 2004 and 2003, respectively.  The excess funds were not deposited into an Enterprise Fund.  (Finding 04-01, pages 13-14).

      The Regional Office of Education #40 accepted the recommendation to comply with statutory and administrative rule requirements.

EXPENDITURE REPORTS NOT SUBMITTED BY DUE DATE

      For several grants, the due date for the filing of expenditure reports with the Illinois State Board of Education was July 31, 2004.  However, the following three grants’ expenditure reports were not filed by Regional Office of Education #40 until September 2, 2004:

·        Title V – Innovative Programs – Formula;

·        Title IV – Safe and Drug Free School – Formula; and

·        Title II – Teacher Quality. 

        Regional Office management stated the reports were not submitted in a timely manner due to an oversight.  Future grant payments could be delayed if reports are not submitted in a timely manner. (Finding 04-2, pages 15-16).  This finding is repeated from our 2003 audit.

       The Regional Office of Education #40 accepted the recommendation to monitor the due dates for expenditure reports, noting that an additional step has been added to ensure reports are submitted on time.  (For previous Regional Office response, see Digest Footnote #1.) 

EXPENDITURE REPORTS DID NOT AGREE TO THE GENERAL LEDGER

        A comparison of the expenditure reports to the Regional Office of Education #40’s general ledger identified two instances where the totals on the final expenditure reports did not agree with the Regional Office of Education #40’s books, resulting in inaccurate expenditure reports. The differences between the general ledger and expenditure reports were $48 for one program, and $12 for the other. 

      Expenditure reports submitted to the Illinois State Board of Education should agree with the expenditures reported on the Regional Office of Education #40’s general ledger. (Finding 04-3, pages 17-18)  This finding is repeated from our 2003 audit.

      The Regional Office of Education #40 accepted the recommendation to have personnel responsible for the reports compare their total expenditures to the general ledger accounts and make necessary corrections before filing the reports.  (For previous Regional Office response, see Digest Footnote #2.)

AUDITORS’ OPINION

      Our auditors state the Regional Office of Education #40’s financial statements as of June 30, 2004 are fairly presented in all material respects. 

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:JRB

SPECIAL ASSISTANT AUDITORS

        Our special assistant auditors were West & Company, LLC.

DIGEST FOOTNOTES

#1: EXPENDITURE REPORTS NOT SUBMITTED BY DUE DATE –Previous Regional Office Response

In its prior response in 2003, the Regional Office accepted the finding stating the expenditure reports were late because of the transition of assistant regional superintendents.  The expenditure reports were sent on August 11, 2003.

#2: AN EXPENDITURE REPORT FOR A SPECIAL REVENUE FUND DOES NOT AGREE TO THE GENERAL LEDGER--Previous Regional Office Response

In its prior response in 2003, the Regional Office accepted the finding stating that the director was trying to get the expenditure reports to agree with the budget.  The Regional Office stated the expenditure report was corrected according to the general ledger.