REPORT DIGEST
OFFICE OF THE STATE FIRE MARSHAL
COMPLIANCE EXAMINATION
For the Two Years Ended June 30, 2010
Release Date: July 21, 2011
Summary of Findings:
Total this audit: 22
Total last audit: 29
Repeated from last audit: 15
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 are also available on the worldwide web at www.auditor.illinois.gov
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SYNOPSIS
• The Office improperly used funds appropriated by the
General Assembly.
• The Office improperly used funds in violation of the
Illinois Vehicle Code.
• The Office did not file its Fiscal Control and Internal
Auditing Act certification in a timely manner, nor did it maintain
documentation to support its evaluation of internal controls.
• The Office did not notify the Secretary of State of all
employees whose positions required them to file an economic interest
statement.
• The Office did not comply with provisions of the Petroleum Equipment Contractors Licensing Act.
FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS
INAPPROPRIATE USE OF APPROPRIATED FUNDS
The Office improperly used funds appropriated by the General
Assembly.
During Fiscal Year 2009, the Office received a lump sum
appropriation from the Fire Prevention Fund (Fund 047) of $450,000 for
administrative expenses of the Elevator and Safety Regulation Act. However, we noted the Office processed 6
vouchers, totaling $858, during Fiscal Year 2009 from this appropriation for
refunds of overpayments received by the Office.
In addition, we noted the Office processed 1 voucher, totaling $203, for
expenses related to the Office’s new fire chief training program from this
appropriation.
Appropriations made by the General Assembly specify the
purposes for which the public funds of the State may be expended. Expending money for costs other than those
designated by the Appropriation Act is a violation of the appropriation process
and limits legislative control. (Finding
1, page 11)
We recommended the Office limit expenditures from
appropriated line items to the purpose for which they are appropriated. In addition, we recommended the Office
utilize the appropriation transfer process or request supplemental
appropriations when appropriations are insufficient to cover expenses incurred
during the fiscal year.
Office officials agreed with our recommendation and stated
they did not process any expenditures from the wrong appropriation codes during
Fiscal Year 2010.
NONCOMPLIANCE WITH THE ILLINOIS VEHICLE CODE
The Office improperly used funds in violation of the
Illinois Vehicle Code (Code) (625 ILCS 5/3-634).
The Office received a lump sum appropriation from the
Illinois Firefighters Memorial Fund (Fund 510) totaling $185,000 for Fiscal
Year 2009. As explained in the Code (625
ILCS 5/3-634), Fund 510 is to be used for expenses associated with the
maintenance and upkeep of the Illinois Firefighters’ Memorial, the annual medal
of honor ceremony, scholarships for children and spouses of firefighters killed
in the line of duty, and upkeep of the Illinois Firefighters’ Museum (Museum),
located on the grounds of the Illinois State Fairgrounds. The Code (625 ILCS 5/3-634(e)) further
stipulates that no more than 10% of the annual proceeds received in Fund 510
shall be used for expenses associated with the Museum.
We noted the Office charged expenditures totaling $184,526
against its appropriation from Fund 510 during Fiscal Year 2009, including
expenditures totaling $56,290 for the Museum.
However, the annual proceeds received in Fund 510 from the issuance of
license plates during the preceding fiscal year only totaled $418,347. Accordingly, the Office should have limited
their expenditures from this appropriation for the upkeep of the Museum during
Fiscal Year 2009 to $41,835. In
conclusion, the actual expenditures charged to this appropriation for the
Museum exceeded the statutorily imposed cap for expenditures on the Museum by
$14,455.
Failure to adhere to the statutorily imposed cap for
expenditures on the Museum reduces the amount of money available in Fund 510
for other statutorily authorized purposes and is noncompliance with the
Code. (Finding 2, pages 12-13)
We recommended the Office evaluate all proposed expenditures
and repair projects for the Museum before they are initiated to ensure the
statutorily imposed cap is not exceeded, or seek legislative remedy to the
statutorily imposed cap.
Office officials agreed that the statutorily imposed cap for
expenditures on the Museum was exceeded but noted the expenditures during
Fiscal Year 2009 included an emergency roof repair for the Museum. Office officials also stated they spent only
a fraction of the amount permitted pursuant to the statutorily imposed cap on
the Museum during Fiscal Years 2008 and 2010.
NONCOMPLIANCE WITH THE FISCAL CONTROL AND INTERNAL AUDITING
ACT
The Office did not file its Fiscal Control and Internal
Auditing Act certification in a timely manner, nor did it maintain
documentation to support its evaluation of internal controls.
The Office did not file its Fiscal Control and Internal
Auditing Act certification for Fiscal Year 2010 in a timely manner. The report was due on May 1, 2010 and was
filed on July 28, 2010, which is 77 days late.
In addition, the Office filed its Fiscal Year 2009 certification in a
timely manner; however, the Office was unable to provide the auditors with
documented evidence of their evaluation of internal controls.
Timely evaluations of internal controls are necessary to
determine whether existing controls are adequate to prevent or detect potential
risks. Failure to maintain the necessary
documentation to support the evaluation of internal controls is noncompliance
with the State Records Act. (Finding 4,
pages 15-16)
We recommended the Office comply with the requirements of
the Fiscal Control and Internal Auditing Act by documenting its review of
internal controls and filing the required reports in a timely manner.
Office officials agreed with our recommendation and stated
their internal audit staff has assumed responsibility for ensuring compliance
with the Fiscal Control and Internal Auditing Act.
ECONOMIC INTEREST STATEMENTS NOT FILED
The Office did not notify the Secretary of State of all
employees whose positions required them to file an economic interest statement.
We noted two employees, the Chief Fiscal Officer and one
Public Service Administrator who oversees contracts for the agency, were
omitted from the list of employees required to file statements of economic interests. As a result, these employees did not file the
economic interest statements due May 1, 2009 and May 1, 2010.
Failure to file and review economic interest statements
could lead to employees making decisions in which they should have been disqualified
due to a conflict of interest. (Finding
5, page 17)
We recommended the Office periodically review job duties and
personnel transactions to ensure all personnel in qualifying positions are
reported to the Secretary of State and subsequently file statements of economic
interests.
Office officials agreed with our recommendation and stated
corrective action has been implemented.
NONCOMPLIANCE WITH THE PETROLEUM EQUIPMENT CONTRACTORS
LICENSING ACT
The Office did not comply with provisions of the Petroleum
Equipment Contractors Licensing Act (Act).
We noted the following weaknesses:
• The Office did not adopt any rules specifying the minimum
amount of training required for the personnel engaged in Underground Storage
Tank (UST) activities regulated under the Act.
• The Act (225 ILCS 729/70) requires the Office to maintain
a log of all complaints received concerning violations regarding parties
licensed under the Act or unlicensed activity.
However, we noted the Office did not maintain a log of complaints
received as required. As a result, we
could not determine if the Office took appropriate action to investigate or
follow up on complaints received.
• We also noted the Office issued 11 refunds, totaling
$9,300, to parties who were either licensed under the Act or who had applied
for licensure. In 10 of these instances,
the Office approached the party and offered refunds, either due to overpayment
or timing of license expirations. In the
other instance, the contractor approached the Office and requested a refund
because it did not wish to submit all of the outstanding items necessary to
process its renewal application.
However, the Act (225 ILCS 729/45(c)) states that all fees paid pursuant
to the Act are nonrefundable.
Failure to adopt required rules may result in a lack of
necessary training to ensure the proper UST installation, testing, and
maintenance for the safety of Illinois owners, operators, and citizens. Failure to maintain a log of all complaints
received is noncompliance with State statute and limits the Office’s ability to
analyze any patterns of complaints received regarding licensed contractors, as
well as activity performed by licensed parties.
The issuance of refunds when prohibited reduces the amount of funding
available to meet the operational needs of the Office. (Finding 12, page 36) This finding has been repeated since
2006.
We recommended the Office adopt rules outlining the minimum
amount of training as required by the Act or seek legislative remedy to the
statutory requirement. We also
recommended the Office comply with the Act’s requirement to log all complaints
concerning violations regarding licensee or unlicensed activity. Lastly, we recommend the Office comply with
the Act’s prohibition of refunds, or seek legislative remedy to the statutory
requirement.
Office officials agreed with our recommendation and stated
legislation currently awaiting gubernatorial approval would resolve the need to
establish a minimum amount of training and would allow for refunds in the case
of accidental overpayments. Office
officials also stated they have established a log for complaints received. (For the previous agency response, see Digest
Footnote #1.)
OTHER FINDINGS
The remaining findings are reportedly being given attention
by the Office. We will review progress
toward the implementation of our recommendations during the next
examination.
AUDITORS’ OPINION
We conducted a compliance examination of the Office as
required by the Illinois State Auditing Act.
The Office has no funds that require an audit leading to an opinion on
financial statements.
WILLIAM G. HOLLAND
Auditor General
WGH:CD:PP
AUDITORS ASSIGNED
This examination was performed by the staff of the Office of
the Auditor General.
DIGEST FOOTNOTES
#1 – NONCOMPLIANCE WITH THE PETROLEUM EQUIPMENT CONTRACTORS
LICENSING ACT – Previous Agency Response
2008: Accepted. The Office will review the Act and Administrative Rules to become fully compliant.