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UNEMPLOYMENT COMPENSATION TRUST FUND
(Proprietary Fund) |
2003 |
2002 |
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OPERATING REVENUES:
Unemployment taxes
Federal government
Total Operating Revenues
OPERATING EXPENSES:
Benefit Payments and Refunds
Operating Gain (loss)
NONOPERATING REVENUES:
Interest and investment income
Other revenue
Total
Gain (loss) before transfers
and other adjustments
TRANSFERS OUT:
Decreases in net assets |
$1,367,760,000
641,944,000
$2,009,704,000
$3,054,290,000
$(1,044,586,000)
$28,664,000
114,000
$28,778,000
$(1,015,808,000)
$(10,045,000)
$(1,025,853,000) |
$1,091,943,000
712,896,000
$1,804,839,000
$2,667,222,000
$(862,383,000)
$86,458,000
100,000
$86,558,000
$(775,825,000)
$ (11,454,000)
$ (787,279,000)
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STATEMENT OF NET ASSETS (at June 30)
Unemployment Compensation Trust Fund |
2003 |
2002 |
|
ASSETS:
Cash and cash equivalents
Investments
Receivables, Net:
Taxes
Intergovernmental
Others
Due from other State funds
Due from component units
Total Assets
LIABILITIES:
Benefit payments payable
Intergovernmental payables
Due to other State funds
Total Liabilities
NET ASSETS:
(Restricted for Unemployment Benefits)
|
$8,355,000
97,319,000
288,208,000
51,093,000
62,204,000
14,851,000
193,000
$522,223,000
$75,385,000
12,439,000
3,130,000
$90,954,000
$431,269,000 |
$43,056,000
1,111,069,000
257,785,000
50,751,000
84,629,000
3,234,000
183,000
$1,550,707,000
$78,203,000
11,245,000
4,137,000
$93,585,000
$1,457,122,000 |
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SUPPLEMENTARY INFORMATION |
*FY 2003 |
FY 2002 |
FY2001 |
-
Average Quarterly State Unemployment Rate
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6.63 |
6.53
|
5.40
|
-
Average Quarterly National Unemployment Rate
|
6.13 |
5.78
|
4.73
|
-
Initial Claims – Unemployment Insurance
|
852,500 |
891,400 |
733,800 |
-
Average Number of Department Employees
|
2,047 |
2,071 |
2,064
|
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*Calculation does not include fourth quarter. |
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AGENCY DIRECTOR |
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During Audit Period: Gertrude W. Jordan (7/1/01 – 2/8/03) Brenda A. Russell (2/10/03 to Present)
Currently: Brenda A. Russell |
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Sixteen of 40 receipts (40%) totaling $236,020 were deposited 2 to 7 days late
The Department did not sufficiently document its review and contract monitoring of Workforce Investment Act subrecipitents |
FINDING, CONCLUSION, AND RECOMMENDATIONS
NEED TO IMPROVE TIMELINESS OF DEPOSITS
The Department did not deposit receipts timely. Revenue and receipts testing disclosed checks received which were not deposited on time by the Department’s Cash Management Unit.
Sixteen of 40 receipts (40%) totaling $236,020 were deposited with the State Treasurer 2 to 7 days late. These late deposits consisted of two receipts totaling $207,963 that were deposited 7 days late; eight receipts totaling $13,768 which were deposited 3 days late; and six receipts totaling $14,289 which were deposited 2 days late. (Finding 1, pages 9-10)
Department officials concurred with our recommendation to strengthen its controls over cash receipts to ensure that receipts are deposited timely.
INSUFFICIENT DOCUMENTATION OF REVIEW AND CONTRACT MONITORING SUBRECIPIENTS
The Department did not sufficiently document its review and contract monitoring of Workforce Investment Act (WIA) subrecipients and did not reconcile amounts in grant close-out reports to audited financial statements.
Our review of 10 contract monitoring files disclosed insufficient documentation of review and contract monitoring of subrecipients, including: conflict of duties not cited as a finding during the field audit; attendance sheets not manually signed by attendees; monitoring summaries of findings not signed by the grantee official; no evidence of supervisory review of working papers for critical areas; and grant numbers in the report not the same as grant numbers in the confirmation letter for the visit.
In addition, the Department did not reconcile amounts in grant close-out reports to audited financial statements submitted by the subrecipients. In our review of eight subrecipient grant close-out packages, we noted that expenditure close-out packages did not reconcile with amounts reflected in the Schedule of Expenditures of Federal Awards in the audited financial statements. (Finding 3, pages 13-14)
WIA programs were transferred to the Department of Commerce and Economic Opportunity (DCEO) effective June 1, 2003 per Executive Order 11 (2003).
Department officials concurred with our recommenda-tion to coordinate with DCEO on exceptions noted and stated that the audit finding had been forwarded to them for their review and consideration.
OTHER FINDING
The other finding dealt with inadequate controls over personnel forms and records. We will review progress toward implementation of all recommendations during the next audit.
AUDITORS’ OPINION
Our auditors stated the Department of Employment Security’s financial statements (Nonshared Governmental Funds) present fairly, in all material respects, the financial position and changes to the financial position as of June 30, 2003. Further, our auditors stated that the financial position of the Unemployment Compensation Trust Fund of the Department as of June 30, 2003, and changes in financial position and its cash flows for the year then ended are presented fairly in all material respects.
___________________________________
WILLIAM G. HOLLAND, Auditor General
WGH:KMC:drh
SPECIAL ASSISTANT AUDITORS
McGladrey & Pullen, LLP were our special assistant auditors for this audit.
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