REPORT DIGEST

 

ILLINOIS PETROLEUM RESOURCES BOARD

 

COMPLIANCE EXAMINATION

For the Year Ended:

June 30, 2005

 

 

Summary of Findings:

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

Total last audit†††††††††††††             2

Repeated from last audit†††††††††† 1

 

 

Release Date:

April 25, 2006 

 

 

 

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 the Full Report are also available on the worldwide web at http://www.state.il.us/auditor

 

 

 

 

 

 

 

 

 

 

SYNOPSIS

 

 

o       The Board improperly utilized a locally held fund established in a prior fiscal year without a specific statutory authorization.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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


 

ILLINOIS PETROLEUM RESOURCES BOARD

COMPLIANCE EXAMINATION

For the Year Ended June 30, 2005

 

 

EXPENDITURE STATISTICS

FY 2005

FY 2004

..... Total Appropriations .............................................................

 

$625,000

$375,000

..... Total Expenditures..................................................................

 

$625,000

$335,498

..... Cost of Property and Equipment.............................................

$44,468

$32,071

 

AGENCY DIRECTOR

During Audit Period:Charles Williams

Currently:Charles Williams



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Board utilized an unauthorized locally held fund

 

 

 

 

 

Excess monies of $31,641 and $29,090 in FY04 and FY05 not returned to Department

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank balances exceed FDIC coverage for 6 of 12 months

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INTRODUCTION

 

The Illinois Petroleum Resources Board was created July 10, 1998 by the Illinois Petroleum Education and Marketing Act.Its mission is to coordinate a program designed to demonstrate to the general public the importance of the Illinois oil exploration and production industry; to encourage the wise and efficient use of energy; to promote environmentally sound production methods and technologies; to develop existing supplies of State oil resources; and, to support research and education activities concerning the oil exploration and production industry.The Board received an appropriation from the Illinois General Assembly through the Department of Natural Resources.

 

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

USE OF UNAUTHORIZED LOCALLY HELD FUND

 

††††† The Board utilized a locally held fund during Fiscal Year 2005 that was established in a prior fiscal year without specific statutory authorization.We noted the following:

 

o       The Board utilized a locally held fund throughout FY05 even though the Board did not obtain proper statutory authorization to establish the locally held fund as required by the State Officers and Employees Money Disposition Act.In addition, the Illinois Petroleum Education Marketing Act did not explicitly permit the Board to establish a locally held fund.

 

o       At the end of FY04, excess monies totaling $31,641 remained in the locally held account.This amount would have been lapsed in the normal appropriation process, and the Board did not return the excess funding to the Department of Natural Resources (Department) to be deposited into the Petroleum Resources Revolving Fund.

 

o       The Board submitted eight claims totaling $625,000 to the Department to draw down on their appropriation for subsequent deposit into the locally held fund in FY05.In addition, the Board did not return $29,090 in excess funds remaining in the locally held account to the Department.

 

o       The Board contracted with an accounting firm to perform bookkeeping functions on behalf of the Board and the partner of the accounting firm had signature authority over this account.

 

o       Month end bank balances exceeded the amount of Federal Deposit Insurance Coverage (FDIC) by amounts ranging from approximately $4,200 to $106,700 for 6 of 12 months in FY05.

 

o       The Board did not prepare nor submit quarterly Reports of Receipts and Disbursements of Locally Held Funds for any of the four quarters of FY05.(Finding 1, pages 8-10)

 

††††† We recommended the Board close the locally held fund and resume processing all expenditures through the Petroleum Resources Revolving Fund until a legislative remedy is sought.

 

††††† Board officials stated they are doing everything possible to provide a legislative remedy to the finding and anticipate that proposed legislation will pass during the current session.

 

 

AUDITORSí OPINION

 

††††† We conducted a compliance examination of the Petroleum Resources Board as required by the Illinois State Auditing Act.We have not audited any financial statements of the Board for the purpose of expressing an opinion because the Board does not, nor is it required to, prepare financial statements.

 

 

___________________________________

WILLIAM G. HOLLAND, Auditor General

 

WGH:JSC:pp

 

 

AUDITORS ASSIGNED

 

††††††††††† This audit was performed by the Office of the Auditor General's staff.