|
Expenditure reports filed with the
Illinois State
Board of Education by Intermediate
Service Center
#4 were based on estimated costs, rather than actual costs incurred for the
Title I – School Improvement and Accountability Program.
|
FINDINGS, CONCLUSIONS AND
RECOMMENDATIONS
INACCURATE REPORTING OF
EXPENDITURES OF FEDERAL AWARDS
As a subrecipient of federal Title I – School Improvement and
Accountability funds from the Illinois State Board of Education (ISBE), South
Cook Intermediate
Service Center
#4 (the Center) is required to submit quarterly expenditure reports. These expenditure reports are required to
reflect, by budget line item, the actual costs incurred as a result of
administering the programs. The Center
is also required to expend the federal funds for only allowable costs.
Expenditure reports filed with the ISBE by the Center were based on
estimated costs, rather than actual costs incurred for the Title I – School
Improvement and Accountability Program (Program). These estimated costs were invoiced by the
Center’s Local Accounts to the Program.
The auditors concluded that these estimated costs were significantly
higher than the costs actually incurred by the Center on the Program. Consequently, ISBE’s reimbursements to the
Center, which were based on the quarterly reports, were greater than the
costs incurred. The Center did not
have a mechanism in place to accurately accumulate the actual costs incurred
by this Program. The amounts charged
in excess of the actual costs remain in the Local Accounts.
The Center reported total costs of $2,139,918 for the Title I – School
Improvement and Accountability Program on ISBE expenditure reports. The Center was reimbursed that amount by
ISBE. However, a qualified independent
party and the auditors determined that total expenditures for all programs
recorded in the Local Accounts were $1,723,655 of which $1,299,528 was
determined to be for the Title I – School Improvement and Accountability Program.
The Center materially overstated the costs charged to the Title I –
School Improvement and Accountability Program to ISBE. Therefore, the Center was not in compliance
with the requirements of the ISBE and OMB Circular A-133.
|
|
|
As a result of the audit finding,
the Center recognized a “due to other governments” of $840,390 for this Program
and will need to reimburse ISBE for funds overcharged. According to officials, the Center did not
have a mechanism in place to accurately track and charge the actual costs incurred
by the Local Accounts on behalf of this Program. (Finding 06-1, pages 8-9)
Auditors recommended that the Center charge actual costs of
administering the Title I –
School Improvement and Accountability Program directly to the program
accounts. The Center should apply the
new procedures to the accounting records in order to provide ISBE with an
updated expenditure report for the year ended June 30, 2006 and reimburse
ISBE for the overcharged funds.
The Center responded that it will charge actual costs of administering
the Title I – School Improvement and Accountability Program directly
to the program accounts going forward.
The Center noted that as a result of this finding it had recognized an
amount due to other governments for all amounts received for this Program in
excess of the actual costs incurred. The
Center also noted that it is working with the Illinois State Board of
Education to develop a system that will better track actual costs of the Program
on the Center’s financial statements and will tie the financial statements to
the completion reports. The year ended
June 30, 2008 grant has been amended and approved and reflects the
appropriate changes based on the results of this audit.
AUDITORS’
OPINION
Our
auditors state the Intermediate
Service Center
#4’s financial statements as of June 30, 2006 are fairly presented in all
material respects.
_____________________________________
WILLIAM
G. HOLLAND, Auditor General
WGH:JRB
SPECIAL ASSISTANT
AUDITORS
Lindgren,
Callihan, Van Osdol & Co., LTD were our special assistant auditors in
this audit.
|
