REPORT DIGEST ILLINOIS EMERGENCY MANAGEMENT AGENCY COMPLIANCE EXAMINATION FOR THE TWO YEARS ENDED JUNE 30, 2017 Release Date: July 25, 2018 FINDINGS THIS AUDIT: 8 CATEGORY: NEW -- REPEAT -- TOTAL Category 1: 0 -- 0 -- 0 Category 2: 3 -- 5 -- 8 Category 3: 0 -- 0 -- 0 TOTAL: 3 -- 5 -- 8 FINDINGS LAST AUDIT: 9 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, Iles Park Plaza, 740 E. Ash Street, Springfield, IL 62703 (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 • (17-04) The Agency did not comply with the Fiscal Control and Internal Auditing Act. • (17-06) The Agency has not conducted a study on the use of nuclear power or on nuclear safety or formulated the State’s general nuclear policy. FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS NONCOMPLIANCE WITH THE FISCAL CONTROL AND INTERNAL AUDITING ACT The Illinois Emergency Management Agency (Agency) did not comply with the Fiscal Control and Internal Auditing Act. During testing of the internal audit function at the Agency, we noted the following: • A detailed audit activities report was not submitted to the Director for Fiscal Year 2016. • The Agency’s internal audit function did not audit the Agency’s major systems of internal accounting and administrative controls on a periodic basis so that all systems are reviewed every two years. We noted the Agency completed one of the eight internal audits planned for Fiscal Year 2016 and only one of four internal audits planned for Fiscal Year 2017 was completed as of June 30, 2017. Further, the Agency did not prepare or transmit its internal control verification for Fiscal Year 2016 to the Auditor General. This finding has been repeated since 2011. We recommended the Agency ensure its internal audit function complies with the provisions of the Fiscal Control and Internal Auditing Act and its annual internal controls certification is prepared and timely filed with the Auditor General. Agency officials accepted our recommendation and stated the position of Chief Internal Auditor was vacant from January 1, 2016 through March 15, 2017. (For the previous Agency response, see Digest Footnote #1.) FAILURE TO PREPARE THE STATE’S GENERAL NUCLEAR POLICY The Agency has not conducted a study on the use of nuclear power or on nuclear safety or formulated the State’s general nuclear policy. During testing, we noted the Agency had not worked with the Department of Natural Resources to study nuclear power and safety or formulate the State’s general nuclear policy. Further, we noted the Agency had pursued legislation to repeal this requirement, which has not been adopted by the General Assembly. This finding has been repeated since 2011. We recommended the Agency conduct the study, formulate the policy, and publish its findings as required by State law, or continue to seek a legislative remedy. Agency officials accepted our recommendation and stated they will continue to seek a legislative remedy. (For the previous Agency response, see Digest Footnote #2.) OTHER FINDINGS The remaining findings pertain to (1) an inadequate information technology disaster recovery plan and tests; (2) weaknesses in computer systems, change management, and property control, and (3) inadequate controls over personnel and payroll records and performance evaluations. We will review the Agency’s progress towards the implementation of our recommendations in our next compliance examination. ACCOUNTANT’S OPINION We conducted a compliance examination of the Agency for the two years ended June 30, 2017, as required by the Illinois State Auditing Act. The accountants stated the Agency complied, in all material respects, with the requirements described in the report. This compliance examination was conducted by the Office of the Auditor General’s staff. JANE CLARK Division Director This report is transmitted in accordance with Section 3-14 of the Illinois State Auditing Act. FRANK J. MAUTINO Auditor General FJM:MEG DIGEST FOOTNOTES #1 – Noncompliance with the Fiscal Control and Internal Auditing Act – Previous Agency Response 2015: The Agency agrees with the finding. A new Chief Internal Auditor was appointed in December, 2014. The Agency believes filling this vacancy will address the weaknesses noted regarding noncompliance with the Act. #2 – Failure to Prepare the State’s General Nuclear Policy – Previous Agency Response 2015: The Agency continues to work towards legislation to revise the statute as the Agency does not have the expertise or staff available to conduct a comparative study on various sources of energy. Senate Bill 1743 was held in the House by the sponsor and was not called for a committee vote. Therefore, the Agency will reintroduce the same measure in the 2016 General Assembly.