REPORT DIGEST

OFFICE OF THE SECRETARY OF STATE

FINANCIAL AUDIT
FOR THE YEAR ENDED JUNE 30, 2019

Release Date:  February 25, 2020

FINDINGS THIS AUDIT:  1

CATEGORY:  NEW -- REPEAT -- TOTAL
Category 1:  0 -- 1 -- 1
Category 2:  0 -- 0 -- 0
Category 3:  0 -- 0 -- 0
TOTAL:  0 -- 1 -- 1

FINDINGS LAST AUDIT: 1

Category 1: Findings that are material
weaknesses in internal control and/or a
qualification on compliance with State laws
and regulations (material noncompliance).
Category 2: Findings that are significant
deficiencies in internal control and
noncompliance with State laws and regulations.
Category 3: Findings that have no internal
control issues but are in noncompliance with
State laws and regulations.

State of Illinois, Office of the Auditor
General
FRANK J. MAUTINO, 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
www.auditor.illinois.gov

SYNOPSIS

• (19-1) The Office did not properly update
calculations and used incorrect query totals
to determine the adjustment to record cash on
hand and cash in transit at fiscal year-end.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

WEAKNESSES IN DETERMINATION OF CASH ON HAND
AND CASH IN TRANSIT AMOUNTS REPORTED IN THE
FINANCIAL STATEMENTS

The Office did not properly update
calculations and used incorrect query totals
to determine the adjustment to record cash on
hand and cash in transit at fiscal year-end.
Additionally, the Office failed to record the
cash on hand entry for the General Revenue
Fund.

During the testing over the cash on hand and
the cash in transit balances reported in the
General Revenue Fund (Fund 0001) and the Road
Fund (0011) auditors noted the following
errors in the calculation:
• The spreadsheet used to calculate the total
cash on hand and cash in transit for the Road
Fund improperly included Fiscal Year 2018
data. The amount of June receipts held in the
Treasurer’s Clearing Accounts but not yet
remitted to the Illinois Office of the
Comptroller at June 30, 2019 was overstated by
$477 thousand. The amount of June receipts not
yet deposited into the Treasurer’s Clearing
Accounts at June 30, 2019 was understated by
$15.2 million. The net understatement in the
Road Fund due to this error was $14.7 million.
• The spreadsheet used to calculate total cash
on hand and cash in transit for the General
Revenue Fund improperly included July 2020
receipts from the queries used to determine
June receipts not yet deposited into the
Treasurer’s Clearing Accounts at June 30,
2019. This resulted in a $6.6 million
overstatement in the General Revenue Fund.
• The Office failed to report cash on hand for
the General Revenue Fund resulting in an
understatement of $13.9 million.
• The spreadsheet used to calculate the cash
in transit for the General Revenue Fund for
delinquent registration fees understated the
amount allocated to the General Revenue Fund
and overstated the amount allocated to the
Road Fund by $828 thousand.
• In addition to the items above, auditors
noted other errors in the spreadsheets that
resulted in a $6 thousand overstatement in the
Road Fund. (Finding 1, pages 62-64).  This
finding was first reported in 2016.

We recommended the Office implement a process
to review the calculation over the cash on
hand and cash in transit process to determine
that the calculation includes the correct
fiscal year information and considers all in
transit activity as of June 30th.

Office officials agreed with the
recommendation and stated the issues noted
have been presented and discussed with the
Office personnel responsible for the
preparation of this information.  Further,
Office officials stated they have committed
additional resources to aid in the review and
oversight of the year-end adjustment
calculations.

AUDITOR’S OPINION

The auditors stated the financial statements
of the Office as of and for the year ended
June 30, 2019 are fairly stated in all
material respects.

This financial audit was conducted by Sikich,
LLP.

JANE CLARK
Division Director

This report is transmitted in accordance with
Section 3-14 of the Illinois State Auditing
Act.

FRANK J. MAUTINO
Auditor General

FJM:sdw