REPORT DIGEST

ILLINOIS EMERGENCY MANAGEMENT AGENCY

COMPLIANCE EXAMINATION

For the Two Years Ended:

June 30, 2007

Summary of Findings:

Total this audit                   3

Total last audit                   6

Repeated from last audit    1

Release Date:

February 20, 2008

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

AUDITOR GENERAL

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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

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SYNOPSIS

¨      The Agency did not provide the auditors or the Office of the State Comptroller with accurate Grant/Contract accounting reports.

¨      The Agency did not reconcile their records to the Office of the State Comptroller in a timely fashion.

¨      The Agency did not inspect radiation installations and sources in a timely manner.

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

EXPENDITURE STATISTICS

FY 2007

FY 2006

FY 2005

     Total Expenditures (All Funds)................

$151,388,242

$139,707,261

$105,273,939

     OPERATIONS TOTAL.........................

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

$117,450,730

77.58%

$130,127,554

93.14%

$99,791,865

94.79%

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

            % of Operations Expenditures........

            Average No. of Full-time Employees

$13,062,140

27.55%

233

$13,662,143

11.03%

239

$13,471,586

45.68%

250

         Other Payroll Costs (FICA, Retirement).

            % of Operations Expenditures.......

$4,514,758

5.20%

$4,473,392

1.71%

$5,580,405

10.71%

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

            % of Operations Expenditures......

$2,743,264

14.53%

$2,897,030

3.20%

$1,413,327

6.16%

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

            % of Operations Expenditures......

$97,130,568

52.72%

$109,094,989

84.06%

$79,326,547

37.45%

     PERMANENT IMPROVEMENTS TOTAL

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

$0

0%

$0

0%

$436,600

.42%

     GRANTS AND REFUNDS TOTAL..........

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

$33,653,825

22.23%

$9,330,170

6.68%

$3,760,434

3.57%

       NON-APPROPRIATED FUNDS............

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

$283,687

.19%

$249,537

.18%

$1,285,040

1.22%

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

$44,149,000

$41,842,000

$24,882,000

AGENCY DIRECTOR

During Audit Period:     William C. Burke (7/1/05 to 3/15/07),

Andrew Velasquez III (3/16/07 to current)

Currently:  Andrew Velasquez III

Inaccurate accounting information provided

$70,000 understatement

$756,000 incorrectly reported

Expenditures overstated by $94,000

Estimated receipts overstated by $128,000

Receivables overstated by $139,000

Reimbursable costs overstated by $128,000

Revenues overstated by $128,000

Agency agreed with auditor recommendations

Agency cash balances were not reconciled to State Comptroller reports

Agency agrees with auditor recommendation

1,258 radiation installation inspections were overdue

Agency accepts auditor recommendation

FINDINGS, CONCLUSIONS, AND

RECOMMENDATIONS

INCORRECT FINANCIAL REPORTING

      The Agency did not provide the auditors or the Office of the State Comptroller with complete and accurate accounting information for grants and contracts (SCO-563 Forms).

Upon initial review of the SCO-563 Forms provided by Agency personnel, the auditors noted the following errors:

·        Reporting for one fund did not include receipts and expenditures for one federal program, resulting in an understatement of $70,000 for total reimbursable costs and current year revenue for the federal program. 

·        In two funds, the Agency recorded receipts, expenditures, and payables using an incorrect CFDA number. 

·        The Agency incorrectly reported amounts in the wrong column for one fund resulting in an overstatement of $756,000 for current year refunds, current year receivables and unavailable deferred revenue, as well as an understatement of $756,000 for subrecipients and current year revenue.

·        Expenditures in one fund were overstated by $94,000. 

·        Receipts in one fund were overstated by $11,000. 

·        Estimated receipts in two funds were overstated by $128,000. 

·        Current year receivables in three funds were overstated $139,000.

·        In four funds, the amounts reported as subrecepients on the SCO-563 Form did not agree to the Agency’s detailed accounting records.  The difference was $3,211,000.

·        Total reimbursable costs in two funds were overstated by $128,000. 

·        Current year revenues in two funds were overstated by $128,000.

      We recommended the Agency comply with SAMS Procedures to ensure accurate financial information is reported to the Office of the State Comptroller.  We further recommended the Agency review its current process for the preparation and review of the SCO-563 Forms and allocate the resources necessary to ensure a thorough review of the SCO-563 Forms by personnel possessing the appropriate skills and knowledge.  (Finding 1, pages 8-9)

      Agency officials accepted our recommendations and stated that they have begun the review of current processes for preparation and review of the SCO-563 Forms.  They will increase staff training and begin to breakdown CFDA expenditures on a quarterly basis which will allow for review and corrections where needed before completion of a final document that will be forwarded to the Office of the Comptroller.

UNTIMELY RECONCILIATION OF AGENCY RECORDS TO THE STATE COMPTROLLER’S REPORTS

      The Agency did not perform timely reconciliations of their records to the Office of the State Comptroller records.  The auditors noted the following reconciliations were not performed timely:

·        The Agency did not perform a reconciliation between Agency expenditures and the Office of the State Comptroller’s Monthly Appropriations Status Report for 1 of 12 (8.3%) months during fiscal year 2006 and 2 of 12 (16.7%) months during fiscal year 2007 in a timely manner.  In addition, one monthly reconciliation for one fund during fiscal year 2006 could not be provided by the Agency. 

·        The Agency did not perform a reconciliation between cash receipts collected by the Agency and the Office of the State Comptroller’s Monthly Revenue Report for 6 of 12 (50%) months during fiscal year 2006 and 3 of 12 (25%) months during fiscal year 2007 in a timely manner. 

·        The Agency did not perform a reconciliation between the Agency’s cash balance and the Office of the State Comptroller’s Monthly Cash Report.  For fiscal year 2007, the Agency was unable to provide reconciliations to the Monthly Cash Reports for all funds administered by the Agency.  For fiscal year 2006, the Agency was unable to provide 12 of 12 (100%) reconciliations for three funds, 11 of 12 (92%) reconciliations for one fund, 3 of 12 (25%) reconciliations for one fund, and 1 of 12 (8%) reconciliations for one fund.  

      We recommended the Agency comply with SAMS and perform monthly reconciliations in a timely manner.  (Finding 2, pages 10-11)

      Agency officials accepted our recommendation and stated that expenditure and revenue reconciliations have been assigned to an Account Technician II within the newly established Accounting and Fee Compliance Section within the Bureau of Finance.  Reconciliations of cash fund balances have been assigned to the Section Manager of the Federal Section within the Bureau of Finance.

UNTIMELY INSPECTION OF RADIATION INSTALLATIONS AND RADIATION SOURCES

      The Agency did not perform inspections of radiation installations and sources in a timely manner.

      The Agency is responsible for inspecting over 11,000 radiation installations.  During review of inspection records, auditors determined that as of June 30, 2007, the inspection of 1,258 radiation installations (11%) were overdue for inspection.  We noted 994 radiation installation inspections (79%) were less than six months late and less than 2% of the radiation installation inspections were over one year late.

      We recommended the Agency comply with the Radiation Protection Act of 1990 by providing adequate resources to complete inspections of radiation installations and radiation sources with the required intervals.  (Finding 3, pages 12-13)

      Agency officials accepted our recommendation and stated that the Agency will continue to work with Agency inspectors to increase their efficiency.

AUDITORS’ OPINION

      We conducted a compliance examination of the Agency as required by the Illinois State Auditing Act.  We have not audited any financial statements of the Agency for the purpose of expressing an opinion because the Agency does not, nor is it required to, prepare financial statements.

____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:TLD:pp

SPECIAL ASSISTANT AUDITORS

      De Raimo Hillger & Ripp were our special assistant auditors for this examination.