DEPARTMENT OF VETERANS' AFFAIRS - CENTRAL OFFICE
FINANCIAL AND COMPLIANCE AUDIT
Summary of Findings:
WILLIAM G. HOLLAND
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DEPARTMENT OF VETERANS' AFFAIRS
FINANCIAL AND COMPLIANCE AUDIT
For The Two Years Ended June 30, 1998
|SERVICE EFFORTS AND ACCOMPLISHMENTS (Unaudited)||
Number of veterans and dependents served
Number of hunting licenses issued
Number of camping permits issued
Number of claims paid
Number of headstones erected
State Approving Agency (based on Federal Fiscal Year)
Number of visits made to ensure continued approval of federal programs
Number of new federal programs approved
|During Audit Period: Mr. Robert Foster
Currently: Mr. John Johnston (effective February 1, 1999)
Responsibilities and reporting structure between the Central Office and the Homes was not clear
Internal audit function did not meet objectives
FINDINGS, CONCLUSIONS, AND
OVERSIGHT AND CONTROL OF INFORMATION SYSTEMS IS LACKING
The Department did not develop or institute policies, procedures, or guidelines to effectively manage and control information systems.
We noted the following weaknesses:
These weaknesses resulted from the lack of understanding of responsibilities and reporting structure between the Central Office and the Homes. (Finding 98-1, pages 13 and 14)
We recommended the Department formalize the Central Office's responsibilities to direct, provide guidance, and monitor the Veterans' Homes' and Field Offices' computer-related issues by developing appropriate policies. Such policies should be distributed Department-wide.
Department officials agreed with the recommendation, and stated a plan was under development which would be implemented within the next year.
NONCOMPLIANCE WITH INTERNAL AUDIT LAWS AND REGULATIONS
The Department's internal audit program did not comply with the Fiscal Control and Internal Auditing Act (Act) (30 ILCS 10/2001 et seq.).
Specifically, the two-year audit plans submitted to the director did not include all major systems of internal accounting and administrative controls, there was no indication that the two-year audit plan for FY97/98 was approved by the director, and a written report was not submitted to the Director detailing how the audit plan for the prior year was carried out. (Finding 98-2, pages 15 and 16)
Furthermore, we noted the internal audit reports and workpapers prepared by the Department's Internal Audit unit were not in accordance with the professional standards of the Institute of Internal Auditors. (Finding 98-3, pages 17 and 18)
We recommended the Department's internal audit program comply with the Fiscal Control and Internal Auditing Act and that the resulting reports and audit workpapers be prepared in accordance with the standards of the Institute of Internal Auditors.
The Department agreed with our recommendations. Department officials stated an audit plan for FY99/00, which contains all required elements, has been submitted to the Director for approval. Furthermore, a report detailing how the plan for FY98 was carried out was also submitted to the Director.
The remaining findings are less significant and the Department responded that corrective action is in process. We will review the Department's progress towards the implementation of our recommendations in our next audit.
Responses to the findings were provided by Mr. Don Bullerman, Chief Internal Auditor, in a letter dated December 18, 1998.
We have stated the financial statements of the Department of Veterans' Affairs as of and for the years June 30, 1998 and June 30, 1997 are fairly presented in all material respects.
This audit was performed by the Auditor General's staff.