REPORT DIGEST

REPORT DIGEST

ILLINOIS

CONSERVATION

FOUNDATION

FINANCIAL AUDIT

AND COMPLIANCE EXAMINATION

(In Accordance with the
Single Audit Act and OMB Circular A-133)

For the Year Ended:

June 30, 2007

Summary of Findings:

Total this report 2

Total prior report 6

Repeated findings 1

Release Date:

February 26, 2008

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 the Full Report are also available on

the worldwide web at

http://www.auditor.illinois.gov

SYNOPSIS

¨ The Foundation did not follow its procedures and policies regarding disbursement processing.

¨ The Foundation did not take timely action during fiscal year 2007 to collateralize (protect) bank balances in excess of the FDIC insurance limit of $100,000.

{Financial and supplementary information are summarized on the reverse page.}

ILLINOIS CONSERVATION FOUNDATION

FINANCIAL AUDIT AND COMPLIANCE EXAMINATION

FOR THE YEAR ENDED JUNE 30, 2007

OPERATING STATEMENT (Governmental Funds)	FY 2007	FY 2006
Revenues: Donations - Restricted..................................................................... Grants and Receipts from Other Governments.................................. Donations – Unrestricted................................................................. Merchandise Sales – Restricted....................................................... Investment Income - Unrestricted.................................................... Investment Income - Restricted....................................................... Increase /(Decrease) In Fair Value Of Unrestricted Investments… Increase /(Decrease) In Fair Value Of Restricted Investments.......... On-Behalf Payments....................................................................... Publication Sales - Restricted........................................................... Total Revenue....................................................................... Expenditures: Administrative ............................................................................... Natural Resources and Recreation Programs.................................... On-Behalf Payments....................................................................... Change in Prepaid Expenses............................................................ Total Expenditures.................................................................. Change In Net Assets...................................................................... Net Assets, Beginning of Year........................................................ Net Assets, End of Year...................................................................	$1,865,470 1,102,569 40,084 68,562 301,385 4,954 140,608 11,119 68,251 3,244 $3,606,246 $ 163,631 2,109,365 68,251 (67) $2,341,180 $ 1,265,066 3,462,422 $4,727,488	$2,476,768 1,075,803 125,482 87,414 218,072 4,733 (9,392) 0 62,117 7,776 $4,048,773 $ 294,838 4,113,467 62,117 241 $4,470,663 $ (421,890) 3,884,312 $3,462,422
STATEMENT OF NET ASSETS (Governmental Activities)	June 30, 2007	June 30, 2006
Assets: Cash And Cash Equivalents....................................... Accounts Receivable................................................. Accrued Investment Income...................................... Inventory.................................................................. Prepaid Expenses...................................................... Investments............................................................... Total Assets.................................................... Liabilities: Accounts Payable And Accrued Expenses................... Deferred Revenue...................................................... Total Liabilities................................................ Net Assets: Natural Resources & Recreation - Restricted............. Endowment/Nonexpendable – Restricted..................... Unrestricted............................................................... Total Net Assets.............................................	$ 1,690,029 190,691 13,806 7,409 7,644 3,065,456 $4,975,035 $ 238,247 9,300 $ 247,547 $2,842,304 81,954 1,803,230 $4,727,488	$ 767,500 135,099 12,765 12,208 7,577 2,701,789 $3,636,938 $ 121,652 52,864 $ 174,516 $1,906,870 70,836 1,484,716 $3,462,422
SUPPLEMENTARY INFORMATION	FY 2007	FY 2006
% of Administrative Expenditures to Total Expenditures.........................	7.0%	6.6%
% of Total Expenditures From Federal Sources......................................	47.1%	23.5%
FOUNDATION CHIEF EXECUTIVES
During Engagement Period: Executive Director: vacant (through 5/15/07), Gregory Legan (effective 5/16/07) Chairman: Sam Flood Currently: Executive Director: Gregory Legan. Chairman: Sam Flood.

13 checks over $5,000 contained only one of two required signatures

Bank balances exceeded FDIC insurance limit on 109 different days for as much as $120,620.

INTRODUCTION

Our report covers the compliance examination and the financial audit of the Illinois Conservation Foundation (Foundation) performed in accordance with the Single Audit Act and OMB Circular A-133 for the fiscal year ended June 30, 2007. The Foundation was authorized to be created by the Illinois Department of Conservation, currently the Illinois Department of Natural Resources (IDNR) by statute on August 20, 1994. The role of the Foundation is to provide additional funding for IDNR’s conservation programs that are not receiving adequate State funding or cannot be implemented because State funding is not available.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

DISBURSEMENT PROCESSING WEAKNESS

The Foundation did not follow its procedures and policies regarding disbursement processing. During our testing of cash disbursements, we discovered the Foundation was not properly obtaining two signatures on all checks written for more than $5,000.

In fiscal year 2007, we tested 109 disbursements. During our examination of corresponding cancelled checks we found 13 checks (12%), each equal to or more than $5,000 and totaling $179,541 contained only one signature.

We recommended the Foundation strengthen controls over disbursement processing by following its policies and procedures to ensure checks over $5,000 are properly signed by 2 authorized signers. (Finding 1, page 17)

Foundation management agreed with our recommendation.

BANK BALANCES IN EXCESS OF THE FDIC INSURANCE LIMIT WERE NOT PROTECTED BY COLLATERAL PLEDGED BY THE BANK

During our testing of cash balances, we noted the Foundation did not take timely action during fiscal year 2007 to collateralize (protect) bank balances in excess of the FDIC insurance limit of $100,000. Our testing identified that at June 30, 2007 a total of $57,472 in bank balances were in excess of the FDIC insurance limit. However, during the fiscal year this account exceeded the insurance limit on 109 different days for as much as $120,620.

We recommended the Foundation request that the bank pledge securities as collateral in a sufficient amount so as to cover the amounts in excess of the FDIC insurance limit. (Finding 2, page 18)

Foundation management agreed to request that the bank pledge securities as collateral in a sufficient amount so as to cover the amounts in excess of the FDIC insurance limit.

AUDITORS’ OPINION

Our auditors state the June 30, 2007 financial statements of the Foundation are fairly presented in all material respects.

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:JMO:pp

SPECIAL ASSISTANT AUDITOR

Kyle E. McGinnis, CPA was our special assistant auditor.

SYNOPSIS

ILLINOIS CONSERVATION FOUNDATION

FINANCIAL AUDIT AND COMPLIANCE EXAMINATION

FOR THE YEAR ENDED JUNE 30, 2007

Change In Net Assets......................................................................

Net Assets, End of Year...................................................................

Total Net Assets.............................................

FY 2007

FY 2006