INTRODUCTION
These reports represent the results of our financial and
compliance audit for the year ending December 31, 2000.
FINDINGS, CONCLUSIONS, AND
RECOMMENDATIONS
FAILURE TO MAINTAIN DATA FOR CASH RECEIPT
RECONCILIATION
The Illinois State Toll Highway Authority’s toll
collection equipment and software did not maintain data necessary for reconciliation of
cash receipts.
During testing, we noted in 7 out of 14 days (50%)
selected for testing, equipment at toll plazas was reset 149 times in order to make
repairs. Information on the amount of cash receipts and the number of vehicles passing
through the plaza lane was lost in all instances. This information is necessary to
reconcile cash receipts. There was an average of 715 resets per month for the year ended
December 31, 2000. This equates to approximately 4.87% of the 14,670 lanes in the system
being reset monthly.
Failure to maintain adequate data results in the breakdown
of the control function. We recommended the Authority establish alternative procedures to
maintain data so that information will not be lost. (Finding 1, page 12). This finding
is repeated from 1999.
Authority officials agreed with the need to maintain
the data, but emphasized that no money was lost. They stated they were in the process of a
major update to their toll collection equipment and in the interim, have reemphasized to
maintenance technicians not to reset the equipment unless absolutely necessary.
INCOMPLETE RECORDING OF CASH COLLECTED AND LACK OF
PROCEDURES FOR REPORTING CASH BALANCING DIFFERENCES
The Authority did not always report the total daily
cash collected for all plazas and did not have adequate written procedures for resolution
of cash balancing variances.
During testing, we noted cash deposits did not include
receipts for all toll plazas, which resulted in daily variances between the actual cash
reported and the amounts computed by toll collection equipment. Also, according to the
Authority’s Internal Audit Department, existing internal control procedures in the
money room were not adequate because they were not documented or always followed.
We recommended money room procedures be documented,
communicated to employees, and include specific instructions regarding cash reporting and
reconciliation issues. (Finding 2, pages 13-14) This finding is repeated from
1999.
Authority officials agreed with our recommendations
and stated the money room policy and procedural manual is in draft format and will be
finalized immediately. The Authority’s response also stated that every attempt will
be made to pull full and partially full vaults and deliver them to the money room for
counting when operationally feasible.
INADEQUATE MONITORING OF CONTRACTOR'S PERFORMANCE LEVEL
The Authority’s procedures were not adequate to
monitor contractor's performance levels.
During testing, we noted that contracts for the repair of
toll equipment included performance standards but the Authority did not have adequate
procedures to monitor the contractor’s actual performance against those standards.
The contract establishes precise time limits to repair toll equipment, which vary by type
of malfunction. If the contractor does not repair a malfunction in the allotted time, the
Authority can assess damage fees. In Calendar Year 2000, the Authority paid $7,236,332 for
toll equipment maintenance but did not assess any damage fees because of inadequate
monitoring procedures.
According to the Authority, this condition existed due to
the inability of its computer system to provide on-line monitoring and reporting of
equipment malfunctions. We recommended the Authority make every effort to monitor
contractors' performance levels and to assess appropriate penalties. (Finding 3, page 15) This
finding is repeated from 1999.
Authority officials agreed with our recommendation.
The Authority stated that effective April 2001, the new Maintenance On-Line Management
System (MOMS) was implemented and is being used for monitoring purposes.
FAILURE TO BILL TOLL VIOLATORS TIMELY
The Authority did not bill toll violators in a timely
manner.
Toll violators were not being billed on a regular basis.
Invoices were sent to toll violators for 5 of the 12 months in Calendar Year 2000. During
Calendar Year 2000, the actual amount billed for violations was $247,563. The Authority
was unable to determine the amount of the billings for months missed because the existing
database maintained cumulative records for violators that were difficult to sort by
previous months. The Authority collected $270,024 during the year from toll violators.
Accounts receivable for toll violators at December 31, 2000 was $1,095,445 with an
allowance for doubtful accounts of $972,330. The total number of toll violators in the
system for June 2001 was 2,770.
When there is a lag time between the violation occurring
and a bill being sent, the likelihood of collecting the full amount billed at a later date
decreases. We recommended the Authority produce a billing and send invoices on a monthly
basis to toll violators. (Finding 7, page 20).
Authority officials agreed that violators were not billed
timely during 2000. The Authority stated that billing information has been compiled for
future notification and collection efforts. The Authority also stated that it is currently
negotiating with contractors to outsource the violator billing and collection process.
OTHER FINDINGS
The remaining findings are being given attention by
the Authority. We will review the Authority’s progress toward implementation of all
our recommendations during our next audit.
AUDITORS’ OPINION
Our auditors stated the Illinois State Toll
Highway Authority’s financial statements as of December 31, 2000 and 1999 present
fairly, in all material respects.
____________________________________
WILLIAM G. HOLLAND, Auditor General
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SPECIAL ASSISTANT AUDITORS
Our special assistant auditors for this audit were
FPT&W, Ltd.
