REPORT DIGEST

DEPARTMENT OF EMPLOYMENT SECURITY

FINANCIAL AUDIT
FOR THE YEAR ENDED June 30, 2024

Release Date:  October 30, 2025

FINDINGS THIS AUDIT: 5

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 3 -- 3
Category 2:  0 -- 2 -- 2
Category 3:  0 -- 0 -- 0
TOTAL:  0 -- 5 -- 5

FINDINGS LAST AUDIT: 8

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

INTRODUCTION

This digest covers the financial statement
audit of the Unemployment Compensation
Trust Fund of the State of Illinois,
Department of Employment Security
(Department) as of and for the year ended
June 30, 2024.

SYNOPSIS

• (24-1) The Department improperly recorded
refunds received related to both federal
and non-federal programs.

• (24-2) The Department did not prepare its
year-end bank reconciliations timely.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

INADEQUATE CONTROLS OVER RECORDING OF
REFUNDS

The Department of Employment Security
(Department) improperly recorded refunds
received related to both federal and non-
federal programs.

The Department was returned approximately
$266 million related to unclaimed debit
cards and other amounts that were funded
during the pandemic, but the claimants were
later determined to be ineligible for
benefits. Of this amount, $239 million
related to federally funded programs and
was returned through the Treasury, $5
million is still owed to the federal
government and is reflected as a liability
at year-end, and $22 million relates to
non-federal programs, which is reflected as
miscellaneous revenue.  In recording the
related transactions, the Department
erroneously booked a large amount of
negative revenue and negative expense,
resulting in an overstatement of
intergovernmental receivables, net by $2
million, contributions for unemployment
taxes by $25 million, and an understatement
of benefit payments and refunds by $246
million, federal revenue by $22 million,
and miscellaneous revenues by $247 million.
An adjustment was recorded to correct these
errors. (Finding 1, page 20)

We recommended the Department strengthen
controls to ensure that refunds are
properly recorded within the financial
statements.

The Department accepted our recommendation.

INADEQUATE CONTROLS OVER CASH
RECONCILIATIONS

The Department did not prepare its year-end
bank reconciliations timely.

As part of our audit, we requested copies
of the June 30, 2024 bank reconciliations.
The reconciliations are between cash as
recorded in the Department’s general
ledger, and cash as reported by the bank
for each account. The Department did not
have the reconciliations prepared timely
for audit fieldwork and we received final
versions of the June 2024 reconciliations
on November 20, 2024. (Finding 2, page 21)
This finding has been reported since 2020.

We recommended the Department prepare a
monthly reconciliation for every cash
account, reconciling the bank and general
ledger balances. We also recommended each
monthly bank reconciliation be timely
completed and reviewed and approved by a
supervisor.

The Department accepted our
recommendations.

OTHER FINDINGS

The remaining findings pertain to
inadequate controls over service providers,
weaknesses in IBIS application, and
inadequate controls over estimated
receivables. We will review the
Department’s progress towards the
implementation of our recommendations in
our next engagement.

AUDITOR’S OPINION

The auditors stated the financial
statements of the Unemployment Compensation
Trust Fund of the Department of Employment
Security as of and for the year ended June
30, 2024, are fairly stated in all material
respects.

This financial audit was conducted by RSM
US LLP.

COURTNEY DZIERWA
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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