REPORT DIGEST

DEPARTMENT OF AGRICULTURE
DUQUOIN STATE FAIR
COMPLIANCE AUDIT AND
SUPPLEMENTARY
FINANCIAL
INFORMATION

For the Two Years Ended:
September 30, 2001

Summary of Findings:

Total this audit 3
Total last audit 10
Repeated from last audit 2

Release Date:
June 26, 2002

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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
Attn: Records Manager
Iles Park Plaza
740 E. Ash Street
Springfield, IL 62703

(217)782-6046 or TDD (217) 524-4646

This Report Digest is also available on
the worldwide web at
http://www.state.il.us/auditor

  

 

 

 

 

 

 

 

 

 

SYNOPSIS
  • The DuQuoin State fairgrounds had weaknesses in its collection processes for space rentals during the non-fair periods
  • The Department did not always employ adequate management oversight controls to compensate for a lack of segregation of duties in the DuQuoin fiscal operations

 

 

 

 

 

 

 

{Revenues, expenditures and supplementary information are summarized on the reverse page.}

ILLINOIS DEPARTMENT OF AGRICULTURE
DUQUOIN STATE FAIR
COMPLIANCE AUDIT
For The Two Years Ended September 30, 2001
REVENUE AND EXPENDITURE STATISTICS

FY 2001

FY 2000

FY 1999
Total Revenue
Tickets
% of Revenue
Space Rental:Fair
% of Revenue
Entry Fees
% of Revenue
Promotions
% of Revenue

Total Expenditures (All Funds)
Personal Services
% of Expenditures
Other Payroll Costs (FICA, Retirement)
% of Expenditures
Contractual Services
% of Expenditures
Fair Entertainment
% of Expenditures
Premiums and Awards
% of Expenditures
Horse Racing Purses
% of Expenditures
All Other Operations Items
% of Expenditures

(Deficiency) of Revenues Over Expenditures

$1,102,406
$589,628
53.5%
$450,389
40.9%
$19,926
1.8%
$42,463
3.8%

$1,981,171
$272,240
13.7%
$50,478
2.6%
$531,670
26.8%
$493,421
24.9%
$142,459
7.2%
$282,233
14.3%
$208,670
10.5%

$(878,765)

$1,028,531
$525,293
51.1%
$422,649
41.1%
$22,460
2.2%
$58,129
5.6%

$1,891,819
$244,384
12.9%
$45,923
2.4%
$445,132
23.5%
$490,816
26.0%
$153,711
8.1%
$230,744
12.2%
$281,109
14.9%

$(863,288)

$1,003,849
$558,492
55.6%
$421,111
42.0%
$24,246
2.4%
Not Included
N/A

$1,878,727
$283,360
15.1%
$52,793
2.8%
$424,142
22.6%
$478,959
25.5%
$141,046
7.5%
$375,231
20.0%
$123,196
6.5%

$(874,878)
SUPPLEMENTARY INFORMATION

FY 2001

FY 2000

FY 1999
Employment Statistics (Approximate)
Full Time Employees
September through May (Temporary)
June (Temporary)
July through August (Temporary)

Selected Activity Measures
Estimated Attendance (Unaudited)
Grandstand Shows – Tickets Sold(Unaudited)
Grandstand Show Revenues
Grandstand Show Expenditures

Pari-mutuel Wagering
Pari-mutual Wagering Receipts
Pari-mutual Wagering Expenditures


3
5
5
120


447,955
21,668
$356,539
$567,998


$136,026
$204,353


3
1
5
128


393,088
20,040
$316,356
$460,357


$119,195
$195,627


5
4
7
170


411,749
21,750
$332,942
$532,556


$133,836
$192,855

AGENCY DIRECTOR

During Audit Period: Mr. Joseph Hampton
Currently: Mr. Joseph Hampton

 

 

 

 

 

 

 

Payments of $10,522 were not received in accordance with contract terms

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Inadequate segregation of duties without compensating controls

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDINGS, CONCLUSIONS, AND

RECOMMENDATIONS

NEED TO IMPROVE THE COLLECTION PROCESS FOR SPACE RENTALS

We noted the following weaknesses in the space rental process during non-fair periods.
  • Payments totaling $10,522 for 4 of 19 contracts tested were not received in accordance with contract terms. Payments were received 2 to 120 days after the due date specified in the contract. One of those payments for $4,635 was received 120 days after the due date. Additionally, the past due amount was not placed in the Comptroller’s Offset System as required by the Illinois State Collections Act of 1986 (30 ILCS 210/5).
  • No contract payment date terms were indicated on the contract for 6 of 19 contracts tested.

Fair officials indicated turnover in personnel had caused some problems with keeping track of collections and that no rules exist pertaining to contract payment dates and terms. (Finding 1, pages 9-10) This finding was first reported in 1997.

Department officials accepted our recommendation to establish formal due dates for the amounts owed the State and collect all non-fair space rental fees in a timely manner in accordance with the Illinois State Collections Act of 1986. (For previous Department responses, see Digest footnote).

NEED TO IMPROVE INTERNAL CONTROLS

The Department did not always employ adequate management oversight controls to compensate for a lack of segregation of duties in its fiscal operations.

We noted concentrations of duties in the following areas for which adequate compensating management controls were not present at the DuQuoin Fair:
  • Temporary employee expenditures – the Human Resource Associate hired temporary employees, posted the daily timesheet into the master timesheet system, and distributed the paychecks to the temporary employees.
  • Space rental revenues – the Space Rental Manager created the space rental agreements and received the payments made by the space renters, compared the amount to the rental agreement, recorded the entries on the books, prepared the deposits and remitted the deposit to the cashier.

Good internal control procedures require that adequate management oversight controls must be utilized to compensate for a lack of segregation of duties. A concentration of duties assigned to a single position could result in a loss from fraud or theft.

According to management, limited staffing resources caused the lack of segregation of duties, and they are working on changes that would increase management oversight without requiring additional staff. (Finding 3, page 12)

Department officials accepted our recommendation to implement adequate compensating management controls or implement procedures to provide for the segregation of duties for DuQuoin fiscal operations.

OTHER FINDING

The remaining finding is less significant and is reportedly being given attention by Department management. We will review the progress toward implementation of our recommendations during our next audit.

Mr. Joseph Hampton, Director, provided the responses to our findings and recommendations.

AUDITORS’ OPINION

Our auditors subjected the supplementary financial information of the DuQuoin State Fair to the tests and other auditing procedures applied in our special State financial related audit testing and internal control review. With respect to the items tested no matters were noted that require adjustment to the supplementary information.

 

 

_______________________________________

WILLIAM G. HOLLAND, Auditor General

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SPECIAL ASSISTANT AUDITORS

Our Special assistant auditors for this audit were Sleeper, Disbrow, Morrison, Tarro & Lively, LLC.

 

 

DIGEST FOOTNOTE

WEAKNESSES IN SPACE RENTAL PROCEDURES – Previous Department Responses

1999: Accepted. The Department will ensure that all current and future contracts are properly dated. The Department does not have the authority to charge late payment penalties, however procedures will be implemented to ensure that all non-fair rental fees are collected in a timely manner. The Department is now maintaining a permanent record of campers and stall rentals.

1997: The Department agrees with this finding. Contracts will be reviewed prior to the event to assure they are properly signed and dated by both parties. The Department has created a form for the lessee to use on which they will document the number of campers and stalls used. Fairground security personnel and Department managers will monitor activities to determine if the information provided is correct.