REPORT DIGEST

UNIVERSITY OF ILLINOIS FOUNDATION

COMPLIANCE EXAMINATION

For the Two Years Ended:

June 30, 2006

Summary of Findings:

Total this audit                          1

Total last audit                          0

Repeated from last audit           0

Release Date:

March 8, 2007 

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

AUDITOR GENERAL

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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.state.il.us/auditor

SYNOPSIS

·        The University of Illinois Foundation (Foundation) did not require all employees to submit time sheets as required by the State Officials and Employees Ethics Act.

FINANCIAL OPERATIONS (All Funds)

FY 2006

FY 2005

REVENUES

Contributions and gifts.............................................................

Investment income...................................................................

Service fees............................................................................

Allocation from the University of Illinois...................................

Endowment property operations..............................................

Annual Funds..........................................................................

Other......................................................................................

Net increase in fair value of investments...................................

Total Revenues....................................................................

EXPENSES

Salaries and benefits................................................................

Meetings, conferences, and special events................................

Equipment...............................................................................

Marketing and communications................................................

Supplies and other...................................................................

Depreciation...........................................................................

Travel.....................................................................................

Actuarial adjustments..............................................................

Distributions to the University of Illinois....................................

Interest on indebtedness..........................................................

Total Expenses....................................................................

Change in Net Assets..........................................................

NET ASSETS, beginning of year........................................

NET ASSETS, end of year..................................................

$146,351,569

7,294,464

9,942,922

8,641,937

589,579

439,742

6,361,142

84,816,689

264,438,044

13,153,622

945,047

373,243

742,181

2,124,375

105,723

939,387

2,721,079

127,278,550

395,962

148,779,169

115,658,875

934,872,572

$1,050,531,447

$123,023,989

3,175,040

8,936,870

7,325,077

652,139

500,927

4,674,381

65,699,969

213,988,392

11,132,089

757,054

491,177

758,460

1,637,835

40,730

749,994

3,055,166

122,520,730

228,395

141,371,630

72,616,762

862,255,810

$934,872,572

FOUNDATION PRESIDENT

During Audit Period:  Dr. Sidney Micek

Currently:  Dr. Sidney Micek

Noncompliance with State Officials and Employees Ethics Act

Use of negative timekeeping system used by employees

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

TIME SHEETS NOT REQUIRED

      The University of Illinois Foundation (Foundation) did not require all employees to submit time sheets as required by the State Officials and Employees Ethics Act (Act).

      The Act required the Illinois Board of Higher Education (IBHE), with respect to State employees of public universities, to adopt and implement personnel policies. The Act (5 ILCS 430/5-5(c)) states, “The policies shall require State employees to periodically submit time sheets documenting the time spent each day on official State business to the nearest quarter hour; contractual State employees may satisfy the time sheets requirement by complying with the terms of their contract, which shall provide for a means of compliance with this requirement.”  The IBHE adopted personnel policies for public universities on February 3, 2004 in accordance with the Act.  The Foundation has not incorporated these policies into the Foundation’s policies.

      We noted the Foundation’s employees did not submit time sheets in compliance with the Act.  Employees generally track their time using a “negative” timekeeping system whereby the employee is assumed to be working unless noted otherwise.  No time sheets documenting the time spent each day on official State business to the nearest quarter hour are maintained. (Finding 1, page 9) 

      We recommended the Foundation amend its policies to require all employees to submit time sheets in compliance with the Act.

      Foundation management stated that they are reviewing the finding and the recommendation is under consideration.

AUDITORS’ OPINION

      Our financial statement audit for the year ended June 30, 2006 was previously issued.  Our auditors stated the Foundation’s June 30, 2006 financial statements are fairly presented in all material respects.

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:TLK:pp

SPECIAL ASSISTANT AUDITORS

      Our special assistant auditors were Clifton Gunderson LLP.