REPORT DIGEST

OFFICE OF THE COMPTROLLER

FISCAL OFFICER RESPONSIBILITIES

FINANCIAL AND COMPLIANCE AUDIT

For the Year Ended:
June 30, 1999

Summary of Findings:

Total this audit 2
Total last audit 4
Repeated from last audit 0

 

Release Date:
April 20, 2000

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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 Office of the Comptroller did not comply with the State Comptroller Act and the Statewide Accounting and Management System (SAMS) manual relating to recording and reporting bonded indebtedness of the State and State agencies.
  • During our testing we noted three exceptions in regard to the accuracy of the monthly Agency reconciliation reports prepared by the Office of the Comptroller.

 

 

 

 

 

{Financial Information and Activity Measures are summarized on the next page.}

 

OFFICE OF THE COMPTROLLER - STATE OF ILLINOIS

FISCAL OFFICER RESPONSIBILITIES

FINANCIAL AND COMPLIANCE AUDIT

FOR THE YEAR ENDED JUNE 30, 1999

                                                                    Fiscal Year 1999                            Fiscal Year 1998
FUND BALANCE (Amounts in Thousands)

Cash Balance

Budgetary Balances*

Cash Balance

Budgetary Balance*
APPROPRIATED FUNDS
General Funds
Highway Funds
Income Funds
Special State Funds
Bond Financed Funds
Debt Service Funds
Federal Trust Funds
Revolving Funds
State Trust Funds


$1,350,636
943,711
228
2,027,616
521,153
461,819
128,122
84,387
214,634


$502,575
834,852
197
1,664,159
518,596
461,820
(121,354)
48,182
151,982


$1,201,514
805,886
171
1,407,155
374,519
475,653
128,696
91,395
207,047


$ 355,892
707,364
115
1,054,756
373,108
456,676
(78,938)
57,732
167,063
Sub-total

$5,732,306

$4,061,009

$4,692,036

$3,093,768
NON-APPROPRIATED FUNDS
Federal Trust Funds
State Trust Funds

$27,799
1,087,206

$27,610 1,004,856

$ 17,173 999,349

$ 16,741 967,957
Sub-total

$1,115,005

$1,032,466

$1,016,522

$984,698
GRAND TOTAL - ALL FUNDS

$6,847,311

$5,093,475

$5,708,558

$4,078,466
* Budgetary Balances represent the balances remaining after reduction of Cash Balances at June 30 by expenditures made during the lapse period.
FINANCIAL HIGHLIGHTS (Amounts in Thousands)

YEAR ENDED
JUNE 30, 1999

YEAR ENDED
JUNE 30, 1998
Total Receipts - All Funds

$50,215,527

$43,907,948
Total Expenditures - All Funds

$49,200,518

$42,195,388
Net Change In Budgetary Fund Balance - All Funds

$1,015,009

$1,712,560
STATE COMPTROLLER
During Audit Period: Honorable Loleta Didrickson (through January 11, 1999) Honorable Daniel Hynes (effective January 11, 1999)
Currently: Honorable Daniel Hynes
 

 

 

 

 

 

 

 

 

 

 

 

 

Office did not submit delinquency letter to Office of Auditor General

 

Office did not ensure bond issue date was accurately reported

 

Office was unable to provide current year bond information

 

 

 

 

 

 

 

 

 

Beginning Cash Report balance did not agree to prior month ending Cash report balance

 

Commercial payment detail did not match the summary total for commercial payments

 

Appropriation Transfer Report did not match the summary total for transfers

 

 

 

 

 

INTRODUCTION

Our 1999 audit of the Comptroller's Fiscal Officer Responsibilities is presented in two parts. The compliance part, with our findings and recommendations, is presented in one document. The financial part, with our opinion on the budgetary financial statements, is presented in the State Comptroller's "Illinois Traditional Budgetary Financial Report." Our opinion on the Statewide general purpose financial statements prepared in accordance with generally accepted accounting principles is contained in the separately issued Comprehensive Annual Financial Report.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

NEED TO IMPROVE CONTROLS OVER BONDED INDEBTEDNESS

The State Comptroller’s Act and the Statewide Accounting and Management System (SAMS) manual require the Office of the Comptroller (Office) to receive bond issue and monthly payment information within 15 days of the issue and voucher payment date, and to maintain current records indicating the outstanding bonded indebtedness of the State and of all State agencies. Some of the items identified in testing the bond area included the following:
  • The Office did not submit an annual delinquency letter to the Office of the Auditor General listing the State agencies not filing monthly Bonded Indebtedness documentation (within 15 days) in timely manner.
  • The Office did not ensure the bond issue date was accurately reflected in the Bonded Indebtedness and Long Term Obligations Annual Report in 2 out of 8 instances tested.
  • The Office was unable to provide records or the applicable dollar amount of revenue bonds outstanding throughout fiscal year 1999. Historically, records relating to revenue bonded indebtedness have not been available in a timely manner.

Office management indicated the weaknesses noted above are due to a system incapable of providing records in a timely manner. (Finding 1, pages 13-14)

We recommended the Office devote sufficient resources to this area to ensure current records of outstanding bonded indebtedness are maintained.

State Comptroller officials agreed with the finding and recommendation and indicated the area responsible has been restructured and responsibilities for bond reporting have been reassigned.

PROBLEMS WITH AGENCY RECONCILIATION REPORTS

The Office of the Comptroller (Office) did not always ensure the accuracy of monthly Agency Reconciliation Reports. During our testing we noted the following:
  • The September 1998 Cash Report ending balance did not agree to the October 1998 Cash report beginning balance in 3 of 15 State funds tested, indicating a discrepancy of $33,281. We noted no recurrence of this issue in other monthly Cash Reports.
  • The commercial payment detail on the November 1998 Cash Report did not match the summary total for commercial payments in 1 of 10 State funds tested, indicating a discrepancy of $33,281.
  • In 1 of 25 Appropriation Transfer Authorizations tested, we noted the appropriation transfer detail on the March 1999 Appropriation Transfer Report did not match the summary total for transfers; there was a difference of $162,360.

The State Comptroller Act requires the Comptroller to maintain complete, accurate financial records relating to State funds and other public funds and assets available to, encumbered by, or expended by each State agency.

Office management indicated the first exception was due to the fiscal year 1998 hard close of the general ledger not occurring until November 1998. The second exception was the result of voucher ranging, whereby the dollar amount or the total of each voucher did not appear in the detail section of the Cash Report. Office management indicated they were aware of the third exception and correcting it would require a major change to the baseline system; therefore, alternatives are being investigated. (Finding 99-2, page 15)

We recommended the Office strengthen controls over reporting to ensure the accuracy of the monthly Cash Appropriation Transfer Reports.

The Comptroller’s Office accepted the recommendation and indicated the Office had previously identified the first two conditions and has implemented corrective action. The Office indicated it is in the process of adjusting reporting formats to address the third condition.

Mr. Stan Brown, Director of Internal Audit, provided the Office responses to our findings and recommendations.

AUDITORS’ OPINIONS

Our auditors state the traditional budgetary financial statements present fairly the fund balances and receipts and expenditures as of and for the year ended June 30, 1999, relating to the Fiscal Officer Responsibilities of the Comptroller.

In addition, the Comptroller has issued a separate Comprehensive Annual Financial Report that has additional details on the financial activities of State agencies and funds. Our auditors report that the general purpose financial statements in the Comprehensive Annual Financial Report as of and for the year ended June 30, 1999 are fairly presented in all material respects.

 

_____________________________________

WILLIAM G. HOLLAND, Auditor General

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SPECIAL ASSISTANT AUDITORS

Pandolfi, Topolski, Weiss & Co., LTD. were our special assistant auditors for this audit.