REPORT DIGEST JUDICIAL INQUIRY BOARD COMPLIANCE EXAMINATION For the Two Years Ended June 30, 2012 Release Date: May 23, 2013 Summary of Findings: Total this audit: 5 Total last audit: 2 Repeated from last audit: 2 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 Full Report are also available on the worldwide web at www.auditor.illinois.gov SYNOPSIS • The Secretary of State was not notified of a Board member whose position required them to file a statement of economic interest. • The Board did not establish and maintain effective internal controls over expenditures. • The Board was not composed of nine members as required by the Constitution of the State of Illinois. FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS FAILURE TO FILE AN ECONOMIC INTEREST STATEMENT The Board did not notify the Secretary of State of a Board member whose position required them to file a statement of economic interest. During testing, the auditors noted a Board member was omitted from the list of individuals required to file a statement of economic interest and, therefore, did not file the required economic interest statement for Fiscal Year 2011 with the Secretary of State. (Finding 1, page 9) We recommended the Board notify the Secretary of State of all individuals required to file a statement of economic interests, as required by State law. Board officials agreed with our recommendation. NEED TO ENHANCE INTERNAL CONTROL OVER EXPENDITURES The Board did not establish and maintain effective internal controls over expenditures. During testing, the auditors noted the following: • The Board did not have an adequate process to identify and pay interest penalties in accordance with the State Prompt Payment Act. The auditors noted the following exceptions: -- At the conclusion of Fiscal Year 2012, the auditors inquired with Board staff concerning any outstanding and unpaid prompt payment interest. After the Board had the Department of Central Management Services run a query in the Accounting Information System, the system report identified six unpaid prompt payment interest vouchers, totaling $1,899. -- The Board was unable to provide documentation of any outstanding and unpaid prompt payment interest liabilities for Fiscal Year 2011. -- During voucher testing, the auditors noted three of 84 (4%) vouchers tested, totaling $48,161, had unpaid prompt payment interest, totaling $1,131. Two of these vouchers were for Fiscal Year 2011 invoices and one voucher was for a Fiscal Year 2012 invoice. • The Board’s staff needs additional training to effectively utilize Department of Central Management Service’s Accounting Information System, which serves as the Board’s voucher processing system. During our review, we noted the Board’s staff was unable to identify all unpaid prompt payment interest vouchers or generate system inquiries and reports due to the Board’s limited experience with the operational functions of Accounting Information System. • The Board’s expenditure records did not agree with and were not reconciled by the Board to the State Comptroller’s Monthly Appropriations Status Report (SB01) from September 2011 through January 2012 during the extended Lapse Period for Fiscal Year 2011. (Finding 4, pages 15-17) We recommended the Board implement controls to comply with the State Prompt Payment Act and the Statewide Accounting Management System. In addition, the Board should ensure employees obtain sufficient training to perform duties efficiently and effectively. Board officials disagreed that they were unable to provide documentation of any outstanding and unpaid prompt payment interest liabilities for Fiscal Year 2011, stating they “provided the Auditor with a Schedule and various Vouchers indicating paid prompt payments to vendors. During testing, the Auditor did not indicate any prompt payments were unpaid or outstanding.” In an auditors’ comment, we noted that contrary to the Board’s response, the auditors noted two Fiscal Year 2011 invoices in the finding above where the Board did not pay incurred prompt payment interest liabilities. LACK OF REQUIRED BOARD MEMBERS The Judicial Inquiry Board (Board) was not composed of nine board members as required by the Constitution of the State of Illinois. During testing, the auditors noted two of four (50%) non-lawyer positions were vacant. These seats were vacated 81 and 630 days prior to June 30, 2012. (Finding 5, page 18) This finding was first reported in 2008. We recommended the Board continue to work with the Governor to ensure the Board’s vacancies are filled in a timely manner as required by the Constitution. Board officials stated they will continue to make efforts to communicate with the Governor regarding the Board’s vacancies. (For the previous Board response, see Digest Footnote #1.) OTHER FINDINGS The remaining findings pertain to: 1) inadequate internal controls over equipment, and 2) inadequate internal control over personal services. We will follow up on these findings during our next examination of the Board. AUDITORS’ OPINION We conducted a compliance examination of the Judicial Inquiry Board as required by the Illinois State Auditing Act. We have not audited any financial statements of the Board for the purpose of expressing an opinion because the Board does not, nor is it required to, prepare financial statements. WILLIAM G. HOLLAND Auditor General WGH:djn:rt AUDITORS ASSIGNED This compliance examination was performed by the Office of the Auditor General’s staff. DIGEST FOOTNOTE #1 – LACK OF REQUIRED BOARD MEMBERS – Previous Board Response Although the Board is not constitutionally required to ensure that vacancies are filled in a timely manner (the Governor has sole responsibility for the appointment of non-judicial members), the Board will continue to actively work with the Governor’s office concerning the matter.