REPORT DIGEST

 

REGIONAL OFFICE OF EDUCATION #19

 

DUPAGE COUNTY

 

FINANCIAL AUDIT

(In Accordance with the
Single Audit Act and OMB Circular A-133)

For the Year Ended:

June 30, 2004

 

Summary of Findings:

 

Total this audit††††            ††††††††† 3

Total last audit††††††††††††            † 5

Repeated from last audit†††††††††† 1

 

Release Date:

August 30, 2005 

 

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 is also available on

the worldwide web at

http://www.state.il.us/auditor

 

 

 

 

 

 

SYNOPSIS

 

        The Regional Office of Education #19 did not prepare bank reconciliations on a timely basis.

 

        The Regional Office of Education #19 did not comply with certain administrative mandates.

 

        The Regional Office of Education #19 did not file quarterly expenditure reports for the Regional Safe Schools program on or before their due dates.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

†††††††

 

 

 

 

 

 

 

 

 

 

 

 

{Expenditures and Revenues are summarized on the reverse page.}

 


 

†††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††

REGIONAL OFFICE OF EDUCATION #19

DUPAGE COUNTY

 

FINANCIAL AUDIT

(In Accordance with the Single Audit Act and OMB Circular A-133)

For The Year Ended June 30, 2004

 

 

 

FY 2004

FY 2003

TOTAL REVENUES

$3,950,485

$6,203,109

Local Sources

$1,012,465

$1,124,875

% of Total Revenues

25.63%

18.13%

State Sources

$1,026,383

$4,876,806

% of Total Revenues

25.98%

78.62%

Federal Sources

$1,911,637

$201,428

% of Total Revenues

48.39%

3.25%

 

TOTAL EXPENDITURES

$4,002,371

$6,176,113

Salaries and Benefits

$2,010,254

$2,079,689

% of Total Expenditures

50.23%

33.67%

Purchased Services

$1,530,619

$1,605,899

% of Total Expenditures

38.24%

26.00%

All Other Expenditures

$461,498

$2,490,525

% of Total Expenditures

11.53%

40.33%

 

 

 

TOTAL NET ASSETS1

$2,582,322

$2,634,208

 

 

 

INVESTMENT IN CAPITAL ASSETS1

 

$254,268

 

$293,352

 

1         In fiscal year 2004, Regional Offices of Education implemented Government Accounting Standards Board (GASB) Statement No. 34 which established a new financial reporting model for state and local governments.Government-wide financial statements are prepared using full accrual accounting that reports Total Net Assets.The fiscal year 2003 ending general fixed assets have been restated to reflect the changes required as part of the implementation of GASB Statement No. 34.Percentages may not add due to rounding.

 

REGIONAL SUPERINTENDENT

During Audit Period: Honorable Darlene Ruscitti

Currently:Honorable Darlene Ruscitti


 

 

 

 

 

 

 

 

 

 

The Regional Office of Education #19 did not prepare bank reconciliations on a timely basis.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Regional Office of Education #19 did not comply with certain administrative mandates.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Regional Office of Education #19 did not file quarterly expenditure reports for the Regional Safe Schools program on or before their due dates.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

 

 

BANK RECONCILIATIONS NOT COMPLETED PROPERLY AND TIMELY

 

††††† The Regional Office of Education #19 has not been preparing bank reconciliations on a timely basis.The June 2004 bank reconciliations were not completed as of October 15, 2004.In addition, the general ledger accounts relating to the specific bank accounts were not identified properly or bank transactions were not recorded consistently in the general ledger bank accounts.

 

†††††† The Regional Office noted that it lost a bookkeeper and Business Manager during the year, resulting in a backlog in many functions, including the bank reconciliations.Also, its computerized general ledger system used for general fund bank accounts crashed.

 

††††† Sound internal controls require bank reconciliations to be performed accurately and promptly.Reconciling items should be investigated immediately and adjustments made to the general ledger.(Finding 04-1, pages 12-13)This finding is repeated from our 2003 audit.

 

††††† The Regional Office of Education #19 agreed with the auditorís recommendation. The finance office has upgraded their computer hardware, begun using the latest version of its financial software package, and put into place a new tape backup system.The Regional Office has also cross-trained finance staff.(For previous Regional Office response, see Digest Footnote #1.)

 

 

NONCOMPLIANCE WITH STATE MANDATES

 

†††† The Regional Office of Education #19 did not comply with certain administrative mandates.The Illinois School Code (105 ILCS 5/3-12) requires that on or before January 1 of each year, the Regional Superintendent shall publish in a newspaper of general circulation published in the region or post in each school building under his/her jurisdiction, certain information regarding the Officeís Institute Fund.The Regional Office did not publish the required report.The Business Manager, who was in charge of this requirement, left the Office.There were no other personnel trained to perform this function.

 

††††† The Illinois Administrative Code (23 Ill. Adm. Code 110.115) states that fees for conferences, workshops, materials and other costs charged for discretionary activities not required by law or rule are to be determined on a cost-recovery basis.Excess funds resulting from registrations or request for materials/services beyond the anticipated cost-recovery basis shall be deposited in an Enterprise Fund to be used solely to reduce the cost of similar items or to cover costs incurred due to less-than-anticipated registrations or requests for materials/services.The Regional Officeís Workshop Fund had a balance of $778,868 as of June 30, 2004.Total expenditures from the Fund were $274,625.

 

†††††† According to the Regional Office, workshop fees were allowed to accumulate and the excess funds were not used to reduce the cost of future workshops due to an uncertainty about funding for these activities on a year-to-year basis.Also, the Regional Office was unaware of the requirement to deposit the excess fees in an Enterprise Fund. (Finding 04-2, pages 14-15)

 

††††The Regional Office of Education #19 agreed with auditorís recommendation noting that it will take steps to ensure that the standards required are met and administrative rules are complied with.

 

 

LATE SUBMISSION OF QUARTERLY REPORTS

 

††††† The Regional Office of Education #19 filed the quarterly expenditure reports for September 30, 2003, and December 31, 2003, on November 20, 2003 and February 10, 2004, respectively, for the Regional Safe Schools program.The grant contract for the Regional Safe Schools program requires quarterly expenditure reports to be submitted at the end of the month following the quarter.The Regional Office did not submit a formal request on or before the due date for an extension time for filing the related reports.†† (Finding 04-3, pages 16-17)

 

††††† The Regional Office of Education #19 agreed with the auditorís recommendation, noting that staff have now been trained to ensure that required reports of the grants are submitted timely or to request a formal extension in the event the reports cannot be filed on due dates.

 

†††††

 

AUDITORSí OPINION

 

††††††† Our auditors state the Regional Office of Education #19ís financial statements as of June 30, 2004 are fairly presented in all material respects.

 

 

 

___________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:KJM:ro

 

 

SPECIAL ASSISTANT AUDITORS

 

††††††† Our special assistant auditors were E. C. Ortiz & Co., LLP.

 

DIGEST FOOTNOTES

 

#1: BANK RECONCILIATIONS NOT COMPLETED TIMELY Ė Previous Regional Office Response

 

In its prior responses in 2003, the Regional Office agreed with finding and stated it would implement a process of performing the bank reconciliation upon receipt of the bank statements.

 

Complete Regional Office responses to prior findings are available upon request from the Auditor Generalís Office.