REPORT DIGEST ILLINOIS STATE BOARD OF EDUCATION FINANCIAL AUDIT For the Year Ended: June 30, 2009 Summary of Findings: Total this audit 1 Total last audit 1 Repeated from last audit 1 Release Date: February 4, 2010 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 Agency did not have adequate procedures to ensure proper identification and recording of all financial information. {Expenditures and Activity Measures are summarized on the reverse page.}

STATE BOARD OF EDUCATION

FINANCIAL AUDIT

FOR THE YEAR ENDED JUNE 30, 2009

(Comparative Data Shown for Fiscal Year Ending June 30, 2008)

SELECTED FINANCIAL INFORMATION Governmental Funds (In thousands)	FY 2009	FY 2008
PROGRAM REVENUES General Fund........................................................... Other funds............................................................. Total Program Revenues.................................... EXPENDITURES General Fund........................................................... Other funds............................................................. Total expenditures............................................. OTHER SOURCES (USES) Appropriations from State resources........................ Reappropriations to future year(s)............................ Receipts remitted to State Treasury..........................	$1,039,117 2,026,767 $3,065,884 $7,459,811 2,044,020 $9,503,831 $7,460,032 ($39,666) ($1,045,776)	$155 1,892,489 $1,892,644 $7,093,140 1,913,429 $9,006,569 $7,124,222 ($40,070) ($7,893)
SELECTED ACCOUNT BALANCES (In thousands)	FY 2009	FY 2008
ASSETS Cash and cash equivalents.............................................. Accounts receivable (includes State and other governments)................................................................. Total assets.................................................................... LIABILITIES Accounts payable and accrued liabilities.......................... Due to local governments............................................... Total liabilities................................................................	$9,287 $116,416 $231,311 $7,799 $1,984,611 $2,004,022	$7,243 $304,065 $437,786 $10,713 $2,073,458 $2,102,068

STATE SUPERINTENDENT OF EDUCATION

During Audit Period: Dr. Christopher Koch

Currently: Dr. Christopher Koch

Receivables were misstated by $7.4 million Deferred revenue was misstated by $6.8 million

INTRODUCTION This report covers our audit of the financial statements of the Illinois State Board of Education for the year ended June 30, 2009. A compliance examination for the two years ended June 30, 2010 will be performed next year. FINDING, CONCLUSION, AND RECOMMENDATION INADEQUATE CONTROL OVER THE FINANCIAL REPORTING PROCESS The Agency did not have adequate procedures to ensure proper identification and recording of all financial information. The Agency had errors on forms reported to the Illinois Office of the Comptroller for use in the Agency and Statewide financial reporting process. Receivables and deferred revenue for one fund were misstated by $7.4 and $6.8 million, respectively. Further, two adjusting entries totaling $395,000 were not captured in the Agency’s review of the forms. (Finding 1, page 36) We recommended the Agency establish and maintain effective controls over the financial reporting process to ensure the accurate submission of financial data. Agency officials agreed with the finding and noted that accurate financial statements were prepared with the assistance of the Office of the Comptroller. Further, officials stated fund balance reconciliations will be performed and more detailed receivable records will be maintained to help ensure the accuracy of financial reporting forms. AUDITORS’ OPINION Our special assistant auditors stated that the Agency’s financial statements of the governmental activities, the major fund, and the aggregate remaining fund information of the Agency, as of and for the year ended June 30, 2009, are fairly stated in all material respects. _____________________________________ WILLIAM G. HOLLAND, Auditor General WGH:LKW:pp SPECIAL ASSISTANT AUDITORS Our special assistant auditors for this audit were Washington, Pittman & McKeever, LLC.