REPORT DIGEST

REGIONAL OFFICE OF EDUCATION #24: GRUNDY AND
KENDALL COUNTIES

FINANCIAL AUDIT
FOR THE YEAR ENDED JUNE 30, 2023

Release Date:  April 24, 2024

FINDINGS THIS AUDIT: 2

CATEGORY:  NEW -- REPEAT – TOTAL

Category 1:  1 -- 0 -- 1
Category 2:  0 -- 0 -- 0
Category 3:  0 -- 1 -- 1
TOTAL:  1 -- 1 -- 2

FINDINGS LAST AUDIT: 2

Category 1: Findings that are material
weaknesses in internal control and/or a
qualification on compliance with
State laws and regulations (material
noncompliance).
Category 2: Findings that are significant
deficiencies in internal control and
noncompliance with State laws and
regulations.
Category 3: Findings that have no internal
control issues but are in noncompliance with
State laws and regulations.

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

• (23-1) The Regional Office of Education
#24 did not provide completed financial
statements in an auditable form by the
August 31 deadline.

• (23-2) The Regional Office of Education
#24 did not have sufficient internal
controls over the financial reporting
process.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

DELAY OF AUDIT

The Regional Office of Education #24 (ROE)
did not provide completed financial
statements in an auditable form by the
August 31, 2023 deadline. The preliminary
draft was provided to the auditors on
November 29, 2023.

The ROE is subject to 105 ILCS 5/2-3.17a
which requires the Auditor General’s office
to cause an audit to be made, as of June
30th of each year, of the financial
statements of all accounts, funds and other
moneys in the care, custody or control of
the regional superintendent of schools of
each educational service region in the State
and of each educational service center
established in the School Code. The audit is
to be conducted in accordance with Generally
Accepted Government Auditing Standards
(GAGAS). The Regional Office of Education or
Educational Service Center may utilize a
cash basis, modified cash basis, or
generally accepted accounting principles
(GAAP) basis of accounting to prepare the
financial statements for audit. The ROE has
chosen to use the cash basis of accounting
for financial reporting.

In accordance with 105 ILCS 5/2-3.17a, the
Auditor General has promulgated
administrative rules and regulations to
govern this process. Those rules, 74 Ill.
Adm. Code 420.320 (c) (2), state that for
audit purposes, each regional office of
education and educational service center
shall make available to the Auditor General
or his designee all books and records deemed
necessary to make and complete the required
audits. The records shall be in auditable
form by August 15 of the succeeding fiscal
year. Financial reports are to be available
no later than August 31 in order for the
annual audit to be completed by an
independent auditor selected by the Auditor
General.

In addition, prudent business practices and
transparency require timely preparation and
completion of financial statements.

Regional Office officials indicated they
made changes to staff that handles the
financials. A new Business Manager was hired
along with an Office Assistant. Those two
positions, along with the county paid
employee, work together to reconcile all
balances, complete payroll, and all other
office financial information. The ROE
contracts with a CPA firm to assist them
with preparing the financial statements. The
new ROE financial team has reconciled
financials and is now currently on pace to
meet the future deadlines. (Finding 23-001,
pages 10 – 11) This finding was first
reported in 2018.

The auditors recommended the ROE should
implement procedures to ensure compliance
with 105 ILCS 5/2-3.17a and 74 Ill. Adm.
Code 420.320 (c) (2). These financial
statements need to be presented to the
Auditor General’s independent auditors for
audit by the August 31 deadline.

ROE Response: The new ROE financial team
have made the necessary financial
corrections. The team has reconciled
financials and is now currently on pace to
meet the future deadlines.

CONTROLS OVER FINANCIAL STATEMENT
PREPARATION

The Regional Office of Education #24 (ROE)
did not have sufficient internal controls
over the financial reporting process. While
the ROE maintained controls over the
processing of most accounting transactions,
there were not sufficient controls over the
preparation of the cash-basis financial
statements for management or employees in
the normal course of performing their
assigned functions to prevent or detect and
correct financial statement misstatements
and disclosure errors and omissions in a
timely manner. The ROE’s financial
information required material adjusting and
reclassifying entries to present the
financial statements in accordance with the
cash basis of accounting.

The ROE is required to maintain a system of
controls over the preparation of financial
statements in accordance with the cash basis
of accounting. The ROE’s internal controls
over financial reporting should include
adequately trained personnel with the
knowledge, skills, and expertise to prepare
and/or thoroughly review cash-basis
financial statements to ensure that they are
free of material misstatements and include
all disclosures as required by the cash
basis of accounting.

Regional Office management indicated the
financial team discovered expenditures were
incorrectly classified in the General Fund
instead of the Education Fund grant
programs. In addition, an error occurred
with accounts being grouped on the financial
statements. (Finding 23-002, page 12)

The auditors recommended as part of its
internal control over the preparation of
financial statements, including disclosures,
the ROE should implement comprehensive
preparation and/or review procedures to
ensure the financial statements, including
disclosures, are complete and accurate.
These procedures should be performed by a
properly trained individual(s) possessing a
thorough understanding of applicable
accounting principles and knowledge of the
ROE’s activities and operations.

ROE Response: The ROE financial team has
established a protocol that has two
different people viewing the classification
of revenue and expenditures.

AUDITORS’ OPINION

Our auditors state the Regional Office of
Education #24’s financial statements as of
June 30, 2023 are fairly presented in all
material respects.

This financial audit was conducted by the
firm of West & Company, LLC.

JOE BUTCHER
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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