REPORT DIGEST

 

NORTHERN ILLINOIS RESEARCH

FOUNDATION

(and Related Subsidiary)

 

FINANCIAL AUDIT

For the Year Ended:

June 30, 2008

AND

STATE COMPLIANCE EXAMINATION

For the Two Years Ended:

June 30, 2008

 

Summary of Findings:

Total this audit†††††††††††††††††††† 1

Total last audit†††††††††††††††††††† 0††††

Repeated from last audit††††† 0

 

Release Date:

April 30, 2009

 

 

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

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

 

 

 

 

 

INTRODUCTION

 

This digest covers our initial financial audit and State compliance examination of the Northern Illinois Research Foundation (Foundation) for the year ended June 30, 2008.

 

The Foundationís first project is the Northern Illinois Proton Treatment and Research Center (NIPTRC).NIPTRC is a limited liability corporation with NIRF as its sole corporate member.NIPTRC will provide proton beam therapy, a highly advanced form of radiation therapy to treat cancer, in a 115,000 square foot facility currently being constructed in West Chicago, Illinois.†† †††

 

SYNOPSIS

 

®      The Foundation did not have adequate controls in place to provide auditors with complete and accurate financial statements.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

{Expenditures and Activity Measures are summarized on the reverse page.}

 

 

 

 

 

 

NORTHERN ILLINOIS RESEARCH FOUNDATION

FINANCIAL AUDIT AND STATE COMPLIANCE EXAMINATION

For the Year Ended June 30, 2008 (Initial Engagement)

 

FINANCIAL OPERATIONS

FY 2008

 

REVENUES

Revenues..........................................................................................

††††† Total revenues............................................................................

 

$†††††††† -

†††††††† -

EXPENSES

Institutional support...........................................................................

††††† Total expenses............................................................................

Decrease in net assets..................................................................

 

††††††† 260,000

260,000

$ (260,000)

 

STATEMENT OF NET ASSETS

AT JUNE 30, 2008

 

Capital assets, net.............................................................................

TOTAL ASSETS...........................................................................

 

Accounts payable and accrued liabilities............................................

TOTAL LIABILITIES..................................................................

 

Unrestricted .....................................................................................

Invested in capital assets...................................................................

TOTAL NET ASSETS..................................................................

$†† 756,000

756,000

 

1,016,000

1,016,000

 

(1,016,000)

††756,000

$(260,000)

 

FOUNDATION BOARD PRESIDENT

During Audit Period:Mr. Gerald Zielinski

Currently:Mr. Gerald Zielinski

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Controls lacking for preparation of complete and accurate financial statements

 

 

 

 

$81,000 in accounts payable were not recorded

 

$260,000 in legal fees were improperly capitalized

 

 

Inadequate segregation of duties

 

 

 

 

FINDING, CONCLUSION, AND RECOMMENDATIONS

 

††††††††††† NEED TO IMPROVE THE FINANCIAL REPORTING PROCESS

 

The Northern Illinois Research Foundation and Related Subsidiary (Foundation) did not have adequate controls in place to provide auditors with complete and accurate financial statements.

 

Adjustments were made to the financial statements for the following items as a result of questions raised in the audit process.

 

                 Record an additional $81,000 of accounts payable at June 30, 2008.

 

                 Record $260,000 to expense certain legal fees and costs that were improperly capitalized.

 

Currently one individual processes all of the financial transactions for the Foundation.In some cases there is an additional review of the transactions, such as additional check signors, but not all transactions or entries are reviewed by a second individual.

 

Foundation management stated that invoices received from subcontractors were both late and inaccurate.This led to multiple adjustments of the financial statements.The size of the current operations did not allow for enough staff to completely segregate all aspects of financial processing and reporting.(Finding 1, pages 10-11 in the compliance report)


Foundation officials accepted the recommendation to review its current method for processing financial transactions and preparing the annual financial statements.The Foundation should allocate resources to ensure a thorough review of the financial statements by personnel possessing the appropriate skills and knowledge.

 

 

 

AUDITORSí OPINION

 

 

Our auditors state the Foundationís financial statements as of June 30, 2008 are fairly presented in all material respects.

 

 

 

 

 

 

††††††††††††††††† ______________________________________

††††††††††††††††††† WILLIAM G. HOLLAND, Auditor General

 

†††††† WGH:JAF:pp

 

 

SPECIAL ASSISTANT AUDITORS

 

Our special assistant auditors for this audit were Clifton Gunderson, LLP.