REPORT DIGEST

DEPARTMENT OF AGRICULTURE

COMPLIANCE EXAMINATION
FOR THE TWO YEARS ENDED JUNE 30, 2023

Release Date:  July 9, 2024

FINDINGS THIS AUDIT: 17

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 8 -- 8
Category 2:  2 -- 7 -- 9
Category 3:  0 -- 0 -- 0
TOTAL:  2 -- 15 -- 17

FINDINGS LAST AUDIT: 30

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, 400 West
Monroe, Suite 306, Springfield, IL
62704-9849
(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

• (23-02) The Department of Agriculture
(Department) had weaknesses in its
administration of locally held funds.
• (23-05) The Department did not exercise
adequate controls over State property.
• (23-07) The Department’s internal controls
over its voucher processing function were
not operating effectively during the
examination period.
• (23-08) The Department internal controls
over its receipt processing function were
not operating effectively during the
examination period.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

WEAKNESSES IN ADMINISTRATION OF LOCALLY HELD
FUNDS

The Department of Agriculture (Department)
had weaknesses in its administration of
locally-held funds.

• During our review of the bank
reconciliations for the 10 locally-held
funds for Fiscal Years 2022 and 2023, we
noted the following exceptions:

    — Nine of 300 (3%) bank reconciliations
    tested were not prepared monthly. This
    occurred in 9 of 24 (38%) bank
    reconciliations for the Centennial Farms
    Signs Fund (Fund 1112).
    — For 78 of 291 (27%) bank
    reconciliations performed and tested,
    the reconciliations did not contain the
    reviewer’s signature and/or signed date;
    therefore, we were unable to test for
    timeliness of review.
    — For 33 of 291 (11%) bank
    reconciliations performed and tested,
    the reconciliations did not contain the
    preparer’s signature and/or signed date;
    therefore, we were either unable to
    determine proper segregation of duties
    between preparer and reviewer or
    determine the bank reconciliation was
    prepared timely.  (Finding 2, pages
    15-17) This finding was first reported
    in 2011.

We recommended the Department ensure
reconciliations for locally-held funds are
performed monthly and documentation is
maintained of preparer and reviewer to
ensure an adequate segregation of duties for
locally-held funds.

The Department agreed with this finding and
recommendation.

INADEQUATE CONTROLS OVER STATE PROPERTY

The Department of Agriculture (Department)
did not exercise adequate controls over
State property.

The following exceptions were identified
from our detailed testing of the
Department’s State property records:

• During our list to floor testing of 60
Department property items, we noted the
following:

    — Four (7%) items, totaling $201,320
    were not properly tagged.
    — Two (3%) items, totaling $30,046, were
    surplused, but were still on Department
    records. The items not removed from
    property records were a copier and
    printer card.
    — Two (3%) items, amounting to $8,278,
    appeared obsolete, but remained on the
    inventory listing and approval had not
    been requested to dispose of the items.
    — One (2%) item (port module), amounting
    to $2,510, was not located.

• During our floor to list testing of 60
Department property items, we noted the
following:

    — Seven (12%) items of undetermined
    value, were not tagged. The items that
    were not tagged were the following: golf
    cart, blower, laminator, spectrometer,
    mower, wood planer, and drill
    compressor.
    — Two (3%) items of undetermined value,
    appeared obsolete and not functional.
    The items found were a wood planer and
    power sander.
    — Three (5%) items of undetermined
    value, were physically identified, but
    not included in the Department’s
    inventory listing. The items that were
    not added to Department records were a
    shaker, balance comparator, and washer
    machine.

• During our testing of 60 property
additions, we noted the following:

    — Thirty-three items (55%), totaling
    $401,982, were recorded in the
    Department’s property records more than
    90 days after acquisition, ranging from
    5 to 821 days late.

• During our testing of 60 property
deletions, we noted the following:

    — For two (3%) items, totaling $34,255,
    the purchase price on the deletion form
    did not match Department records,
    resulting in a total difference of $654.
    — Seventeen (28%) items, totaling
    $122,381, were removed from Department
    property records more than 90 days after
    deletion, ranging from 6 to 744 days
    late.

In addition, we reviewed 215 Office of the
State Fire Marshal inspection reports of the
Department’s buildings and grounds and noted
109 (51%) inspection/reinspection reports
indicated a result of “Fail” in one or more
circumstances. Examples of failed
inspections included, but not limited to,
violations of electrical systems, fire alarm
systems, replacement of combustible items,
portable fire extinguishers, and barn
safety. (Finding 5, pages 24-27) This
finding was first reported in 2007

We recommended the Department strengthen its
procedures over property and equipment to
ensure accurate and timely recordkeeping and
accountability for all State assets. We also
recommended the Department work with the
Office of the Governor and the Illinois
General Assembly to obtain the resources
necessary to address the safety conditions
noted by the Office of the State Fire
Marshal on Departmental grounds.

The Department agreed with this finding and
recommendation.

VOUCHER PROCESSING INTERNAL CONTROLS NOT
OPERATING EFFECTIVELY

The Department’s internal controls overs its
voucher processing function were not
operating effectively during the examination
period.

Our testing noted 3 of 140 (2%) attributes
were not properly entered into the ERP
System.  Therefore, the Departments internal
controls over voucher processing were not
operating effectively.  Due to this
condition, we qualified our opinion because
we determined the Department had not
complied, in all material respects, with
applicable laws and regulations, including
the State uniform accounting system, in its
financial and fiscal operations.

In addition, we noted the Department did not
timely approve 771 of 19,559 (4%) vouchers
processed during the examination period,
totaling $3,145,358.  We noted these
vouchers were approved between 1 and 291
days late.  (Finding 7, pages 31-32)  This
finding was first reported in 2019.

We recommended the Department design and
maintain internal controls to provide
assurance its data entry of key attributes
into ERP is complete and accurate.  Further,
we recommended the Department approve proper
bills within 30 days of receipt.

The Department agreed with this finding and
recommendation.

RECEIPT PROCESSING INTERNAL CONTROLS NOT
OPERATING EFFECTIVELY

The Department’s internal controls overs its
receipt processing function were not
operating effectively during the examination
period.  During our testing, we noted the
Department does not consistently utilize the
ERP fields for receipts and refunds
processing across all bureaus.  Even with
the limitations noted, we selected a sample
of receipts and refunds and identified the
following:

• 34 of 140 (25%) refund attributes tested
were not properly entered into the ERP.
Therefore, the Department’s internal
controls over receipt processing were not
operating effectively.  Due to this
condition, we qualified our opinion because
we determined the Department had not
complied, in all material respects, with
applicable laws and regulations, including
the State uniform accounting system, in its
financial and fiscal operations.
• The Department did not deposit 198 receipt
items, each exceeding $10,000, on the same
day as received with the 5 day deposit
extension.
• The Department did not deposit 12,672
receipt items, $10,000 or more in totality,
within 24 hours.
• The Department did not deposit 643 receipt
items, exceeding $500 but less than $10,000
in totality, within 48 hours.
• The Department did not deposit 159 receipt
items, less than $500 in totality, when
accumulated to $500 or on the 1st or 15th of
the month, whichever was earlier.
• The Department had 871 receipt items,
where the receipt date was later than the
deposit date.
• The Department had 1 receipt item, which
had an erroneous receipt date entered into
the ERP system.  (Finding 8, pages 33-35)
This finding was first reported in 2017.

We recommended the Department design and
maintain internal controls to provide
assurance its data entry of key attributes
into ERP is complete and accurate.  Further,
we recommended the Department accurately
record deposit data and timely deposit
receipts into the State’s treasury.

The Department agreed with this finding and
recommendation.

OTHER FINDINGS

The remaining findings pertain to inadequate
internal controls over audit functions,
cybersecurity, service providers,
reconciliations, state vehicles, employee
personnel and payroll files, census data,
performance evaluations, employee training,
contractual agreements,  and noncompliance
with the Lawn Care Products and Application
Notice Act, and the Egg and Egg Products
Act. We will review the Commission’s
progress towards the implementation of our
recommendations in our next State compliance
examination.

ACCOUNTANT’S OPINION

The accountants conducted a State compliance
examination of the Commission for the two
years ended June 30, 2023, as required by
the Illinois State Auditing Act.  Because of
the effect of noncompliance described in
Findings 2023-001 through 2023-003, 2023-005
through 2023-008, and 2023-012, the
accountants stated the Department had not
complied, in all material respects, with the
requirements described in the report.

This State compliance examination was
conducted by Adelfia LLC.

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

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