REPORT DIGEST

DEPARTMENT OF CORRECTIONS -

ILLINOIS YOUTH CENTER AT HARRISBURG

LIMITED SCOPE

COMPLIANCE EXAMINATION

For the Two Years Ended:

June 30, 2006

Summary of Findings:

Total this audit                         4

Total last audit                         1

Repeated from last audit           0

Release Date:

June 20, 2007

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 is also available on

the worldwide web at

http://www.auditor.illinois.gov

SYNOPSIS

¨      The Center did not exercise adequate control over voucher processing.

¨      The Center did not maintain adequate controls over commodities inventory.

¨      The Center did not exercise adequate controls over persons taking leaves of absence.

¨      The Center did not update the Automated Property Control System (AIMS) in a timely manner.

        {Expenditures and Activity Measures are summarized on the reverse page.}

EXPENDITURE STATISTICS

FY 2006

FY 2005

FY 2004

     Total Expenditures (All Appropriated Funds)

$18,793,027

$18,958,733

$17,090,447

     Personal Services...........................

         % of Total Expenditures...................

         Average No. of Employees....................

         Average Salary Per Employee............

     Inmate Compensation ................................

       % of Total Expenditures............................

$13,247,262

70.5%

255

$51,950

$42,556

0.2%

$13,141,397

69.3%

258

$50,936

$59,388

0.3%

$12,150,905

71.1%

259

$46,915

$55,350

0.3%

     Other Payroll Costs (FICA, Retirement)........

         % of Total Expenditures.............

$2,182,797

11.6%

$3,002,943

15.9%

$2,586,024

15.1%

     Contractual Services....................................

         % of Total Expenditures.............

$2,440,650

13.0%

$1,937,122

10.2%

$1,793,970

10.5%

     All Other Items.......................................

         % of Total Expenditures.................

$879,762

4.7%

$817,883

4.3%

$504,198

3.0%

     Cost of Property and Equipment..............

$23,016,888

$22,815,711

$22,611,916

SELECTED ACTIVITY MEASURES (Not Examined)

FY 2006

FY 2005

FY 2004

     Average Number of Residents

375

372

316

     Ratio of Correctional Officers to Residents

1/2

1/2

1/1.7

     Cost Per Year Per Inmate

$50,008

$50,962

$53,953

     Rated Resident Capacity

276

276

276

     Approximate Square Feet Per Resident

45

51

54

CENTER WARDEN(S)

     During Examination Period:  Mr. Robert Briddick (7/1/04-12/1/05), Vacant (12/2/05-3/31/06), Mr. Greg Pattison (4/1/06-6/30/06)

     Currently:  Mr. William J. Kilquist

Vouchers were approved late

Failure to conduct proper monthly inventories

Physical count discrepancies

Employee was overpaid $1,068 during leave of absence

Failure to seek reimbursement

APCS not updated with newly acquired assets

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

NEED TO IMPROVE VOUCHER PROCESSING CONTROLS

      The Center did not exercise adequate controls over voucher processing. 

      The Center did not approve all vouchers for payment within the required time limits.  We noted 50 of 120 (42%) vouchers tested, totaling $169,912, were approved for payment from 2 to 94 days late. 

      Center management stated that lack of funding prevented timely processing and payment of vendor invoices.  Invoices cannot be approved for payment until sufficient funds are available for expenditure.

      Failure to promptly approve vouchers may result in late payment of bills to vendors and result in interest charges levied against the Center.  However, we noted no such interest charges were paid or required to be paid by the Center during the engagement period. (Finding 1, page 10)

We recommended the Center comply with the Department’s Administrative Directives and the Illinois Administrative Code procedures and implement controls to ensure vouchers are approved within the required time frame.

      Center management accepted our recommendation.

NEED TO ENHANCE CONTROLS OVER COMMODITIES INVENTORY

The Center did not maintain adequate controls over the commodities inventory.  We noted the following:

·        The Center did not conduct the proper monthly inventories of the commodities storeroom.  Staff was not available to enter commodities transactions into the Automated Inventory Management System (AIMS) timely enough to facilitate an accurate record of commodities by the end of the month.  Although the Center did conduct informal monthly inventories, they did not place reliance on the counts because the AIMS records were not considered accurate.  However, AIMS was updated prior to the physical count at June 30, 2006.

·        The Center’s physical count as of June 30, 2006 contained discrepancies when compared to the auditor’s physical count.  We noted 2 of 50 (4%) items tested that were included on the AIMS system and the facility’s test counts at zero value.

Center management stated the facility is significantly understaffed and this prevented AIMS from being updated timely.  Without an accurate inventory record, physical counts could not be properly conducted.  Center management also stated they believed they followed the Administrative Directive regarding the verification and audit of the year-end physical count.  (Finding 2, page 11-12)

We recommended the Center properly maintain the perpetual inventory records in a timely manner and complete the monthly physical counts.

Center management indicated our recommendation has been implemented.

INADEQUATE INTERNAL CONTROLS OVER EMPLOYEES ON LEAVES OF ABSENCE

The Center did not exercise adequate controls over persons taking leaves of absence.

One of 10 employees tested taking a leave of absence during the examination period was overpaid $1,068 and the Center did not seek reimbursement from the employee.

Center management stated the overpayment is attributed to a miscalculation of the employee’s time on the Payroll Time Report and therefore considered human error.  The staff performing the timekeeper duties had the proper forms necessary to accurately complete the form, but was very new to the position.  Center management did not seek reimbursement for the overpayment because by the time the error was detected, the employee had been terminated.  (Finding 3, page 13)

We recommended the Center work with newly appointed timekeepers to enhance internal controls and have a supervisor review the Payroll Time Report to ensure its accuracy prior to processing.  Further, the Center should seek reimbursement for the overpayment.

Center management accepted our recommendation.

AUTOMATED PROPERTY CONTROL SYSTEM NOT UP TO DATE

The Center did not update the Automated Property Control System (APCS) in a timely manner.

During our examination of Fixed Assets, we noted variances between the ACPS records and the Fixed Asset quarterly report used to report fixed asset transactions to the Central Office.  The Center was not updating the APCS system with newly acquired assets.  Estimated total of variances between the APCS system and the fixed asset reports was $82,536 in building improvements and $38,780 in equipment purchases as of June 30, 2006.  The Center has not updated the APCS system for newly acquired assets since April, 2006.

Center management stated the facility is understaffed and this prevented APCS from being updated timely.  Staff is not available to input the fixed asset items into APCS.  (Finding 4, page 14)

We recommended the Center personnel ensure all additions are timely recorded on property control records and C15W reports.

Center management accepted our recommendation.

AUDITORS' REPORT

      We conducted a limited scope compliance attestation engagement of the Center as required by the Illinois State Auditing Act.  We also performed certain agreed-upon procedures with respect to the accounting records of the Center to assist our audit of the entire Department.  Financial statements for the Department will be presented in that report.

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:AKS:pp

SPECIAL ASSISTANT AUDITORS

      Our special assistant auditors for this examination were Kerber, Eck, and Braeckel, LLP.