REPORT DIGEST

 

OFFICE OF THE COMPTROLLER -
FISCAL OFFICER RESPONSIBILITIES

 

FINANCIAL AUDIT AND COMPLIANCE EXAMINATION

For the Year Ended: June 30, 2009

 

Summary of Findings:

Total this audit              2

Total last audit              0

Repeated from last audit           0

 

Release Date: March 16, 2010

 

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, 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 http://www.auditor.illinois.gov

 

INTRODUCTION

 

            This digest covers our financial audit of the Office of the Comptroller - Fiscal Officer Responsibilities, Illinois Traditional Budgetary Financial Report for the year ended June 30, 2009 and the compliance examination covering the year ended June 30, 2009.

 

 

SYNOPSIS

 

•           The Office of the Comptroller (Office) did not make statutorily mandated transfers between State funds within established timeframes.

 

•           The Office did not issue all FY09 warrants by the end of lapse period, August 31, 2009, as required by statute.

 

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

 

LATE PAYMENT OF STATUTORILY MANDATED TRANSFERS

 

            The Office of the Comptroller (IOC) did not make all transfers between State funds within the established timeframe, as required by statute.

 

            The Office processed transfers between 31 to 203 days after the mandated transfer date for a total of $1.5 billion in FY09.  Failure to make inter-fund transfers within applicable timeframes is in noncompliance with State law and might result in delayed use of appropriated funds.

 

            IOC officials stated the late payment of transfers occurred because of cash management decisions and prioritization required due to the lack of available cash in the State Treasury. (Finding No. 09-1, page 9)

 

            We recommended the Office make transfers within timeframes established by law.  If there is a lack of available funds in the State Treasury, we recommended the Office of the Comptroller continue in its efforts to make transfers as timely as possible.

 

            Office of the Comptroller officials concurred with the recommendation.

 

WARRANTS ISSUED AFTER FISCAL YEAR LIMITATION

 

            The Office of the Comptroller (IOC) did not issue all fiscal year 2009 warrants by August 31, 2009 (close of lapse period).

 

            The Office expended $478,151,765 for 19,867 warrants issued after the State’s lapse period for fiscal year 2009.  The State Finance Act (Act) states with regard to fiscal year limitations that “outstanding liabilities as of June 30, payable from appropriations that have otherwise expired, may be paid out of the expiring appropriations during the 2-month period ending at the close of business on August 31.”  In addition, IOC had not issued warrants for outstanding FY09 liabilities created for the Build Illinois Bond Fund.

 

            Management stated that they did not construe the Act to prohibit issuance of warrants after August 31 for vouchers received on or before that date.  In addition, management believed that it was important to continue to pay remaining FY09 liabilities irrespective of whether it was after August 31 in order to avoid disruption of State operations and services.  (Finding 2, pages 10-11)

 

            We recommended the Office seek legislative authority to enable it to pay outstanding liabilities of the State after August 31 when such liabilities have been incurred and appropriately submitted for payment to the Comptroller during the two month lapse period.

 

            Office of the Comptroller officials concurred with the recommendation.

 

AUDITORS' OPINION

 

            We conducted a compliance examination of the Comptroller's Fiscal Officer Responsibilities for the year ended June 30, 2009 as required by the Illinois State Auditing Act.

 

            Our auditors stated the fund balances at June 30, 2009, and the revenues and expenditures for the year then ended relating to the State of Illinois, Office of the Comptroller - Fiscal Officer Responsibilities’ Traditional Budgetary Financial Report, are fairly presented in all material respects.

 

            The budgetary basis fund balance of the General Funds decreased by $2,838,339,272 during the fiscal year ended June 30, 2009.  At June 30, 2009, the budgetary basis fund balance of the General Funds was a deficit of $3,672,829,839.

 

WILLIAM G. HOLLAND, Auditor General

 

WGH: CML

 

SPECIAL ASSISTANT AUDITORS

 

Our special assistant auditors were Sikich, LLP.