REPORT DIGEST

ILLINOIS LIQUOR CONTROL COMMISSON

COMPLIANCE EXAMINATION
FOR THE TWO YEARS ENDED JUNE 30, 2023

Release Date:  July 9, 2024

FINDINGS THIS AUDIT: 12

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 4 -- 4
Category 2:  2 -- 6 -- 8
Category 3:  0 -- 0 -- 0
TOTAL:  2 -- 10 -- 12

FINDINGS LAST AUDIT: 12

State of Illinois, Office of the Auditor
General
FRANK J. MAUTINO, AUDITOR GENERAL

To obtain a copy of the Report contact:
Office of the Auditor General, 400 West
Monroe, Suite 306, Springfield, IL
62704-9849
(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

• (23-01) The Illinois Liquor Control
Commission (Commission) did not maintain
adequate controls over receipts.
• (23-02) The Commission did not file
statutorily required reports and submissions
or did not file them timely.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

INADEQUATE CONTROLS OVER RECEIPTS

The Illinois Liquor Control Commission
(Commission) did not maintain adequate
controls over receipts.

According to Commission records, the
Commission collected total revenues of $21.0
million and $6.1 million which were
deposited into the General Revenue Fund
(Fund 001) and the Dram Shop Fund (Fund 821)
during Fiscal Years 2022 and 2023,
respectively.  However, as discussed in
Finding 2023-003, we noted irreconcilable
differences of $46,088 and $141,600 between
the Commission’s receipt records and the
Office of Comptroller’s Monthly Revenue
Status Report (SB04) reports as of June 30,
2022 and June 30, 2023, respectively.

Due to these conditions, we were unable to
conclude whether the Commission’s population
records were sufficiently precise and
detailed under the Attestation Standards
promulgated by the American Institute of
Certified Public Accountants (AT-C § 205.36)
to test the Commission’s receipts.

Even given the population limitation noted
above which hindered the ability of the
accountants to conclude whether selected
samples were representative of the
population as a whole, we performed testing
and noted the following:

During testing of 60 receipts collected and
deposited during the examination period, we
noted the following:

• Fourteen (23%) receipts tested, totaling
$144,950, were deposited between one and 15
days late.

• For 20 (33%) receipts tested, totaling
$87,275, the Commission was unable to
provide adequate supporting documentation to
enable us to trace the individual receipts
items to the Treasurer’s Draft (Draft) and
Receipts Deposit Transmittal (RDT) (C-64)
form used to process the receipt into the
State Treasury. Therefore, we were unable to
determine if these receipt items were
actually included in the Draft and RDTs
provided.

In addition, during our testing of the
Agency Fee Imposition Report, we noted the
following:

• For the Fiscal Year 2022 Agency Fee
Imposition Report, fines and penalties
amounting to $927,249 were reported under an
incorrect revenue code.

• For the Fiscal Year 2023 Agency Fee
Imposition Report, the funds into which the
fees are deposited are not accurately
reported.  As of June 30, 2023, deposits to
Dram Shop Fund of $1,082,633 and General
Revenue Fund of $3,922,187 per SB04 report
were not identified and separately reported
in the Agency Fee Imposition Report.
(Finding 1, pages 11-13)

We recommended the Commission establish
adequate controls over the receipts process
to ensure proper documentation of receipts
transactions are maintained, receipts are
timely deposited, and statutorily required
reports are completed accurately as required
by State laws.

The Commission agreed with this finding and
recommendation.

INADEQUATE CONTROLS OVER REPORTING
REQUIREMENTS

The Commission did not file statutorily
required reports and submissions or did not
file them timely.

During testing, we noted the following:

• The Commission submitted the Fiscal
Control and Internal Auditing Act (FCIAA)
certification for Fiscal Year 2022 to the
Office of the Auditor General, 17 days late.

• The Commission did not submit an annual
report of its acts and doings to the
Governor for Fiscal Year 2021.

• The Commission submitted one report to the
General Assembly during the examination
period. However, a copy of such report was
not provided to the State Library, nor such
report was published on the Commission’s
website. In addition, the Commission did not
provide and deposit with the State Library
copies of all publications issued by the
Commission, including electronic
publications, for its collection and
exchange purposes during Fiscal Years 2022
and 2023.

• Four of 24 (17%) of monthly Debt
Transparency Act reports submitted by the
Commission to the Office of Comptroller
during the examination period were one to 25
days late. These reports were for Fiscal
Year 2022.

• One of 4 (25%) Travel Headquarter (TA-2)
Reports filed by the Commission to the
Legislative Audit Commission (LAC) during
the examination period was filed 97 days
late.

• During the prior examination, the
Commission did not accurately report
information on its Fiscal Year 2020 Agency
Workforce Report (Report). During the
current examination, we noted the Commission
failed to submit the corrected the corrected
Report within 30 days after the release of
the Commission’s prior audit by the Auditor
General.

•  The Commission submitted its Fiscal Year
2022 Annual Inventory Certification Report
to the Department of Central Management
Services (CMS) 35 days late.

• The Commission did not submit its Fiscal
Year 2021 Individually Assigned Vehicles
(IAV) Report to CMS while the Fiscal Year
2022 IAV Report was submitted 91 days late.
(Finding 2, page 14-16)

We recommended the Commission Strengthen its
internal controls over reporting to ensure
statutorily required reports are completed
accurately and submitted timely as required
by State laws.

The Commission agreed with the finding and
recommendation and stated that they will
improve internal controls to ensure annual
reports are submitted in compliance with
laws and regulations.

OTHER FINDINGS

The remaining findings pertain to inadequate
controls over monthly reconciliations,
voucher processing, personal services, state
vehicles, review of user access rights and
GenTax Access, noncompliance with payment
card industry data security standards,
weaknesses in cybersecurity and disaster
recovery planning, and lack of adequate
controls over the review of internal
controls over service providers. We will
review the Commission’s progress towards the
implementation of our recommendations in our
next State compliance examination.

ACCOUNTANT’S OPINION

The accountants conducted a State compliance
examination of the Commission for the two
years ended June 30, 2023, as required by
the Illinois State Auditing Act.  The
accountants qualified their report on State
compliance for Finding 2023-001 through
Finding 2023-004.  Except for the
noncompliance described in these findings,
the accountants stated the Commission
complied, in all material respects, with the
requirements described in the report.

This State compliance examination was
conducted by Adelfia LLC.

JANE CLARK
Division Director

This report is transmitted in accordance
with Section 3-14 of the Illinois State
Auditing Act.

FRANK J. MAUTINO
Auditor General

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