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FINDINGS,
CONCLUSIONS, AND RECOMMENDATIONS
PAYMENTS WERE MADE FOR EFFICIENCY INITIATIVE BILLINGS
FROM IMPROPER LINE APPROPRIATIONS
The Department on Aging (Department) made payments for efficiency
initiative billings from improper line item appropriations.
Public Act
93-0025, in part, outlines a program for efficiency initiatives to
reorganize, restructure and reengineer the business processes of the
State. The State Finance Act details
that the amount designated as savings from efficiency initiatives implemented
by the Department of Central Management Services (CMS) shall be paid into the
Efficiency Initiatives Revolving Fund.
“State agencies shall pay these amounts…from the line item
appropriations where the cost savings are anticipated to occur.”
The Department did not receive guidance or
documentation with the billings from CMS detailing from which line item
appropriations savings were anticipated to occur. According to Department staff, they received no documentation
or information from CMS detailing the nature and/or type of savings that CMS
anticipated. The only guidance
received was the amount of payments that should be taken from General Revenue
Funds ($181,751) versus Other Funds ($2,465) for the September 2003 billings.
Based
on our review, we question whether the appropriate appropriations, as
required by the State Finance Act, were used to pay for the anticipated
savings. For example, the Vehicle
Fleet Management Initiative billing was not paid from the Department’s
Operation of Auto Equipment appropriation.
We found that the Department made
payments for these billings not from line item appropriations where
the cost savings were anticipated to have occurred but from a line item that
simply had available monies to make payments from. The Department used:
§
$184,216 from a
distributive lump sum grant-in-aid appropriation to pay for all the
efficiency billings described above.
The specific appropriation was “For Grants and for Administrative
Expenses Associated with Case Management.”
§
In a
correspondence to CMS dated September 26, 2003, the Department’s Director
reported that without knowing how the savings were computed it was “unclear
which line items should be adjusted.”
Further, the Director stated “An alternative to further reducing our
FY04 GRF operations budget would be to transfer the funds from our Community
Care Program. Doing so, however, removes
funding to pay for critical senior services.” (emphasis added) The Department requested further guidance
from CMS in the correspondence, did not receive a response from CMS, and paid
the entire amount from the appropriation utilized for the Community Care
Program.
The Department paid a total of $184,216
for the efficiency initiative.
(Finding 1, pages 9-11)
We recommend that the Department only
make payments for efficiency initiative billings from line item
appropriations where savings would be anticipated to occur. Further, the Department should seek an
explanation from the Department of Central Management Services as to how
savings levels were calculated, or otherwise arrived at, and how savings
achieved or anticipated impact the Department’s budget.
Department officials partially agreed
with our finding and stated, in part, that they were unsuccessful in
receiving support documentation from the Department of Central Management
Services on the calculation for the projected Efficiency Initiative.
SECURITY POLICIES AND PROCEDURES NEED IMPROVEMENT
The Department had not established
adequate comprehensive security-related policies and procedures, nor had it
formally assigned a Security Administrator.
The Department relied on its computer
systems for meeting its business objectives and administering State and
federal funds. Comprehensive
information systems policies and procedures had not been developed.
We also noted that the Department had
not established formal policies and procedures related to various information
system areas including:
·
Appropriate uses of computer equipment, including policies on
personal and unlicensed software;
·
General security provisions, including internet and network security;
·
Routine backup of information and off-site storage of backups;
·
Virus protection measures; and,
·
Physical security.
Department officials stated that the
Department’s information system resources were not allocated to developing
policies and procedures because other projects were assigned higher
priorities. (Finding 3, pages 15-16)
We recommended the Department formally
assign security administration responsibilities to ensure written
security-related policies and procedures are established and enforced for
securing the Department’s computer resources. Once assigned, the Security Administrator should work with
Department officials to establish comprehensive formal policies and
procedures relating to its information systems.
Department officials agreed with our
recommendation and indicated that they are currently addressing this issue as
part of the Health Insurance Portability and Accountability Act of 1996
security assessment.
YEAR END ACCOUNTING REPORTS NOT FILED TIMELY
The Department on Aging failed to file
certain accounting reports on a timely basis with the Office of the State
Comptroller.
The Department filed the
following accounting reports late to the Office of the State Comptroller:
Number
of Days Late
FY04 FY03
SCO-563 26 5
SCO-563C 26 42
SCO-580 70 34
The SCO-563 is the
Grant/Contract Analysis form. The
SCO-563C is the Grant/Contract Analysis Supplemental Information form and the
SCO-580 is the Compensated Absences form.
Department officials
stated that the forms SCO-563, SCO-563C and the form SCO-580 were not timely
filed due to time constraints, due to existing fiscal staff being required to
spend time working on the transfer of the Circuit Breaker/Pharmaceutical
Assistance Program and due to staff shortages.
Failure to submit
reports to the Office of the State Comptroller on a timely basis affects the
State’s ability to timely complete the State of Illinois’ Comprehensive
Annual Financial Report. (Finding 4,
pages 17-18) This finding was first
reported in 2000.
We recommended that the Department allocate
sufficient resources for the timely and accurate preparation of accounting
reports submitted to the Office of the State Comptroller. Further, the Department should train additional
staff on the preparation of these reports to alleviate the Department’s
dependence on certain employees.
Department
officials agreed with our recommendation and indicated that changes are being
implemented to guarantee timely report filing. (For previous agency response, see Digest Footnote #1)
SENIOR BENEFIT PROGRAM NOT
IMPLEMENTED
The Department did not
implement the senior benefits advocacy program through area agencies on
aging. Additionally, the Department
did not distribute funds under this program.
Effective January 1, 1997
the Illinois Act on Aging (20 ILCS 105/4.10) required the Department to
develop and implement a senior benefits advocacy program statewide through
area agencies. The Act also required
that the Department distribute funds under this Section in accordance with
the formula provided in Title 89, chapter 2, part 230.45 of the Illinois
Administrative Code.
Department officials
stated that the Senior Benefits Program is unfunded on a statewide
basis. Department officials stated
that the program would cost approximately $1.92 million to fund statewide and
that they last requested funding in
fiscal year 1998 for this program.
(Finding 6, page 20-21)
We
recommend the Department implement the senior benefits advocacy program on a
statewide basis through area agencies as required by law or seek legislative
remedy to the statutory requirement.
Department
officials agreed with our recommendation and stated that many attempts were
made to obtain funding for the Senior Benefits Program statewide, however,
they cannot implement this programmatic mandate without an appropriation.
COMMUNITY SENIOR SERVICES AND
RESOURCE ACT NOT IMPLEMENTED
The Department failed to
implement the provisions of the Community Senior Services and Resources Act
(the Act).
The Community Senior
Services and Resources Act (320 ILCS 60/) became effective on July 22, 2003
and requires the Department to perform the following duties:
(1) Promulgate rules, regulations,
guidelines, and directives necessary to implement the Act.
(2) Establish a Community Senior Services
and Resource Center Advisory Committee.
(3) Make grants to non-profit agencies and
units of local government on or after January 1, 2005.
(4) Facilitate access to government-issued
bonds for the purpose of capital improvement.
(5) Provide technical assistance to
centers.
(6) Develop a comprehensive list of centers
and the senior services they offer for publication on the Department’s web
site and for distribution through other promotional opportunities.
(7) Develop a survey for annual
distribution through the centers to gather information concerning the lack or
inadequacy of senior services and to identify service demand trends and the
unique needs of older Illinoisans and their families.
(8) Conduct an annual survey of centers to
access their facility, program and operational needs.
(9) Report annually in conjunction with the
Advisory Committee to the Governor and the General Assembly. The report shall include findings from all
surveys conducted pursuant to this Act, a list of grantees by county
(including amounts awarded), and recommendations concerning the ongoing
financial stability of centers.
(10) Pursue
alternative funding opportunities.
The Department nominated
members to serve on the Community Senior Services and Resources Center
Advisory Committee. The Department
did not promulgate any rules, regulations, guidelines or directives necessary
to implement the Act nor have they complied with any of the other duties
required by the Act.
Department officials
stated that they were unable to obtain funding to implement the Act. Department officials further stated that
they did not pursue the alternative funding specified in the Act and that
those funding sources were not required to provide funds. Department officials also stated that they
have not determined the amount of funding necessary to implement the
Act. (Finding 7, pages 22-23)
We recommended the
Department implement the Community Senior Services and Resources Act or seek
legislative remedy to the statutory requirement.
The Department officials
agreed with the finding and indicated that they forwarded nominations to the
Governor’s office for his appointment to the Advisory Committee in January
2004. The nominations were approved
in July 2004. Since that time the
Department has convened two meetings with the Advisory Committee, they have
elected a Chairman, they have developed draft by-laws, and established
meeting dates for the rest of 2005.
Department officials further indicated that the Advisory Committee’s
Chairman has sent letters to all of the entities listed in the legislation
that could provide funds to implement the Act and that although they are
behind the timeframes listed in the Act, the Department is now implementing
the Act consistent with the legislative intent.
NEED TO ESTABLISH SPECIALIZED ALZHEIMER’S DAY CARE RESOURCE CENTERS
The Department failed to establish one
urban and one rural specialized Alzheimer’s Day Care Resource Center as
required by the Illinois Act on the Aging (the Act). In addition, the Department failed to
contract with a public or private agency to develop a training module for the
specialized Alzheimer’s Day Care Resource Centers.
The Illinois Act on Aging (20 ILCS
105/8.05 (b)) states that in order to address the needs of persons suffering
from Alzheimer’s disease or a disease of a related type, the Department shall
encourage the development of adult day care for these persons through the
administration of specialized Alzheimer’s Day Care Resource Centers. The Act requires the Department to
establish at least one urban and one rural specialized Alzheimer’s Day Care
Resource Center.
The Act also requires the Department to
contract with a public or private nonprofit agency or with professional
persons in the fields of health or social services with expertise in
Alzheimer’s disease to develop a training module for the specialized
Alzheimer’s Day Care Centers.
Department officials
stated that they believed the Adult Day Care Resource Centers were never
opened because monies were never appropriated for that purpose. Department officials further stated that
the Department did not request funding in their fiscal year 2003 or 2004
appropriation request. Department
officials also stated that they believed they were complying with the
training provisions of the Act by providing funding to colleges and hospitals
for Alzheimer’s training. (Finding 8,
pages 24-25)
We recommended the Department establish
one specialized Alzheimer’s Day Care Resource Center in an urban area and one
in a rural area and develop a training module to assist persons with
Alzheimer’s disease and other related diseases of that type as required by
the Act or seek legislative remedy to the statutory requirement.
Department officials indicated they plan
to: 1) seek funding to open for the
centers, or 2) recommend that this section be amended to remove the statutory
mandate.
ANNUAL REVIEW OF INTERNAL CONTROLS NOT PERFORMED TIMELY
The Department did not timely file the
required certification for fiscal year 2004 that the Department’s systems of
internal fiscal and administrative controls comply with the requirements of
the Fiscal Control and Internal Audit Act (FCIAA). The Department’s fiscal year 2004 certification required by
FCIAA should have been filed with the Office of the Auditor General by May 1,
2004. However, it was filed 27 days
late. (Finding 5, page 19) This finding was first reported in
2002.
We recommended the Department commence
the annual internal control review earlier to alleviate unforeseen time
constraints on individuals involved in the annual internal control review
process in order to file the required certification in a timely manner.
Department officials agreed with the
finding and indicated that staff responsible for monitoring FCIAA compliance
was new to this responsibility and while the form had been completed,
submission of the report by the required date to the Auditor General was
overlooked. (For previous agency
response, see Digest Footnote #2.)
OTHER FINDING
The remaining findings are less
significant and are reportedly being given attention by the Department. We will review the Department’s progress
towards the implementation of our recommendations in our next audit.
Mr. Charles D. Johnson, Director,
provided responses to the findings for the Department on Aging.
ACCOUNTANTS’ REPORT
Our
auditors stated that the Department on Aging complied in all material
respects with the compliance requirements described in the Audit Guide for
Financial Audits and Compliance Attestation Engagements of Illinois State
Agencies as adopted by the Auditor General during the two years ended June
30, 2004.
_____________________________________
WILLIAM G. HOLLAND, Auditor General
WGH:JAF:pp
SPECIAL
ASSISTANT AUDITORS
Our Special Assistant
Auditors were De Raimo Hillger & Ripp.
DIGEST FOOTNOTES
#1 -
COMPTROLLER’S YEAR END ACCOUNTING REPORTS NOT FILED TIMELY – Previous Agency
Response
2002: The Department is making changes to our
accounting procedures to overcome the difficulties in completing the SCO
reports. We will also document future
attempts at resolving lateness on the Comptroller’s behalf in getting the
reports to us. It is also our
understanding that several Departments have refused to complete the SCO-563C.
#2 – ANNUAL REVIEW OF INTERNAL CONTROLS NOT
PERFORMED TIMELY – Previous Agency Response
2002: The Department acknowledges the
oversight. Due to personnel changes,
the staff responsible for monitoring the FCIAA compliance was new to this
responsibility and while the form had been completed and filed internally the
submission of the report to the auditor general was overlooked.
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