Compliance Plan Fiscal Year 2025
30 ILCS 5/2-16
Statutory Requirement
Public Act 100-0801 amended the Illinois State Auditing Act to provide the following new section:
(30 ILCS 5/2-16)
Sec. 2-16. Contract aspirational goals. The Auditor General shall establish aspirational goals for contract awards substantially in accordance [with] the Business Enterprise for Minorities, Women, and persons with Disabilities Act, unless otherwise governed by other law. The Auditor General shall not be subject to the jurisdiction of the Business Enterprise Council established under the Business Enterprise for Minorities, Women, and Persons with Disabilities Act with regard to steps taken to achieve aspirational goals. The Auditor General shall annually post the Office’s utilization of businesses owned by minorities, women, and persons with disabilities during the preceding fiscal year on the Office’s Internet websites.
The purpose of this report is to set contracting goals, a plan for achieving those goals, and the results of our efforts as required by P.A. 100-0801.
Policy Statement
The Auditor General’s Office adopts the public policies set forth in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/1]. Specifically, it is the public policy of the Auditor General’s Office to promote and encourage the continuing economic development of minority-owned (MBE) and women-owned and operated businesses (WBE, WMBE) and that minority-owned and women-owned and operated businesses participate in our procurement process as both prime and subcontractors. It is also the public policy of the Auditor General’s Office to promote and encourage the continuous economic development of businesses owned by persons with disabilities (PBE). Further, although no specific aspirational goals are established in the Act, it is the policy of the Auditor General’s Office to promote and encourage the economic development of service disabled veteran owned small businesses (SDVOSB) and veteran owned small businesses (VOSB).
Legal Basis
The Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/] sets specific dollar value aspirational goals for State contracts/subcontracts with MBE, WBE and PBE businesses. The Auditor General’s Procurement Rules permit the OAG’s Chief Procurement Officer to “establish goals and other such preferences for contracting or subcontracting with businesses owned and controlled by minorities, women and persons with disabilities.” [44 ILAC 500.1190]
Aspirational Goals
The Auditor General’s Office adopts the aspirational goals set forth in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/]. Specifically, “[w]hen a State agency…awards contracts for…accounting services…it shall be the aspirational goal to use such firms owned by minorities, women, and persons with disabilities…for not less than 20% of the total dollar amount of State contracts; provided that, contracts representing at least 11% of the total dollar amount of State contracts shall be awarded to businesses owned by minorities. . .contracts representing at least 7% of the total dollar amount of State contracts shall be awarded to women-owned businesses…; and contracts representing at least 2% shall be awarded to businesses owned by persons with disabilities.” [30 ILCS 575/4f(c)]
Aspirational Goals Expressed in FY24 Dollar Amounts
All terms are as defined in the Business Enterprise for Minorities, Women, and Persons with Disabilities Act [30 ILCS 575/]. In classifying contractors and subcontractors, we relied upon certifications from the Commission on Equity and Inclusion, which has taken over the duties formerly done by the Department of Central Management Services. Due to the system changeover that occurred at the Commission as of July 15, 2024, we utilized the master list document of all firms certified as of June 17, 2024 for this year’s outreach. In the future we will utilize the new Supplier Diversity Management Portal.
Beginning of Year - Projected FY25 Contract Dollar Amounts:
FY25 appropriations total $46,329,296 [P.A. 103-589]. Personal Services costs (which are not subject to contracting) are $8.1 million. The appropriation balance of $38,229,296 (rounded to $38,200,000) represents the approximate dollar value of contracts subject to the aspirational goals during FY25. Twenty-percent of $38,200,000 results in an overall aspirational goal for FY25 of $7,640,000, broken down by category as follows:
|
11% minority-owned (MBE) |
$4,202,000 |
|
7% women-owned (WBE) |
$2,674,000 |
|
2% persons with disabilities (PBE) |
$764,000 |
|
Total FY24 Goal |
$7,640,000 |
Due to the Office moving to a Statewide audit of the Annual Comprehensive Financial Report (ACFR) for FY25, instead of individually contracted agency financial audits rolling up into the ACFR audit, these audits will take place at the Statewide level, audit work that will likely be done by one firm, where there were many in the past. This may impact the Office’s ability to meet aspirational goals more than usual, but hopes the flexibility of compliance examination-only engagements may open the door for more firms who may have not wanted to take on government financial audit work before.
FY25 Action Plan
Quantitative Results: At the beginning of FY21, a large MBE-certified firm doing business with our Office was acquired by a non-MBE firm. The same minority employees continue to staff the engagements with our Office, but the contracts are now held by the non-MBE firm. As a result, while our ability to meet our contracting aspirational goals has been negatively affected, the diversity of staffing on our engagements remains the same. Since then, there have been additional changes to the CPA firm landscape, including partners branching off into their own firms, firms moving to Limited Liability Partnerships instead of Certified Professional Accountant Limited Liability Corporations. We continue to seek out diverse firms that are BEP certified, but remain at the mercy of the market in many ways due to the highly regulated nature of government auditing.
Qualitative Results: We are mindful of barriers to contracting/subcontracting with the OAG that may impede participation in our audit program by MBE, WBE, WMBE, PBE, SDVOSB and VOSB businesses. As a consequence, we will take the following actions during FY25:
i) Access the Commission’s Supplier Diversity Management Portal https://cei.illinois.gov/supplier-diversity-management-system.html.
ii) Input NIGP (National Institute of Government Purchasing) codes to identify vendors who are certified in codes that may contain skill sets relevant to our audit program:
91804: Accounting, Auditing, Budget Consulting
94620: Audit Services
94631: Certified Public Accountant (CPA) Services
96403: Accounting, Auditing, Bookkeeping Personnel
2) Develop list of new possible BEP/VBP audit firms (eliminate firms already in our program and firms that have already been contacted during the preceding two years).
3) Reach out to those firms with information on our Office and identifying a liaison with our Office to whom those firms can direct their specific questions about our audit program, procurement opportunities, and prequalification requirements.
As noted above, this year’s annual outreach list was compiled by reference to the Commission’s master list available on their website until July 15, 2024 when the new portal went live. We have been granted access by the Commission to utilize the new portal in future as we update our list.
FY24 Review
Amount of total expenditures subject to contracting: $31,275,355.37
Total Expenditures: $38,168,561.49
Less: Personal Services, Fringe Benefits, Travel & Other: ($6,893,206.12)
Goals Based on Actual Spending: $31,275,355.37
Minority-Owned (11%): $3,440,189.09
Women-Owned (7%): $2,189,274.88
Persons w/ Disabilities (2%): $625,507.11
Actual FY24 Dollar Amounts: $31,275,355.37
Minority-Owned: $355,050
Women-Owned (7%): 4,245,669
Persons w/ Disabilities (2%) 0
Actual FY24 Percentages:
Minority-Owned (1.13%)
Women-Owned (13.56%)
Persons w/ Disabilities (0%)
Total: 14.7%
As in previous years, one of the Office’s largest contractors is classified as a women-owned firm, though it is certified as both women-owned and minority-owned. However, we do not count their contracting amounts twice.