REPORT DIGEST

 

REGIONAL OFFICE OF EDUCATION #38

 

LOGAN/MASON/MENARD COUNTIES

 

FINANCIAL AUDIT

 

For the Year Ended:

June 30, 2008

 

Summary of Findings:

 

Total this audit††††††††††††††††††††††2

Total last audit††††††††††††††††††††††4

Repeated from last audit†††††††2

 

Release Date:

June 25, 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

http://www.auditor.illinois.gov

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SYNOPSIS

 

 

 

 

  • The Regional Office of Education #38 did not have sufficient internal controls over the financial reporting process.

 

  • The Regional Office of Education #38ís funds deposited at a financial institution exceeded the Federal Deposit Insurance Corporation (FDIC) insured limit by $46,853 and no additional collateral was obtained.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

 

 

 

 

REGIONAL OFFICE OF EDUCATION #38

LOGAN/MASON/MENARD COUNTIES

 

FINANCIAL AUDIT

For The Year Ended June 30, 2008

 

 

 

FY 2008

FY 2007

TOTAL REVENUES

$468,235

$431,744

Local Sources

$153,237

$154,265

% of Total Revenues

32.73%

35.73%

State Sources

$303,708

$265,179

% of Total Revenues

64.86%

61.42%

Federal Sources

$11,290

$12,300

% of Total Revenues

2.41%

2.85%

 

TOTAL EXPENDITURES

$475,594

$434,170

Salaries and Benefits

$408,499

$369,903

% of Total Expenditures

85.89%

85.20%

Purchased Services

$41,863

$38,824

% of Total Expenditures

8.80%

8.94%

All Other Expenditures

$25,232

$25,443

% of Total Expenditures

5.31%

5.86%

 

TOTAL NET ASSETS

$163,534

$170,893

 

INVESTMENT IN CAPITAL ASSETS

$7,828

$13,843

 

Percentages may not add due to rounding.

 

 

REGIONAL SUPERINTENDENT

During Audit Period: Honorable Jean Anderson

Currently: Honorable Jean Anderson

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


The Regional Office of Education #38 did not have sufficient internal controls over the financial reporting process.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


The Regional Office of Education #38ís funds deposited at a financial institution exceeded the Federal Deposit Insurance Corporation (FDIC) insured limit by $46,853 and no additional collateral was obtained.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

 

 

INTERNAL CONTROL OVER FINANCIAL STATEMENT PREPARATION

 

†††††††† The Regional Office of Education #38 is required to maintain a system of controls over the preparation of financial statements in accordance with generally accepted accounting principles (GAAP). Regional Office internal controls over GAAP financial reporting should include adequately trained personnel with the knowledge and expertise to prepare and/or thoroughly review GAAP based financial statements to ensure that they are free of material misstatements and include all disclosures as required by the Governmental Accounting Standards Board (GASB).

 

†††††††† The Regional Office of Education #38 did not have sufficient internal controls over the financial reporting process.The Regional Office maintains their accounting records on the cash basis of accounting. While the Regional Office maintains controls over the processing of most accounting transactions, there are not sufficient controls over the preparation of the GAAP based financial statements for management or employees in the normal course of performing their assigned functions to prevent or detect financial statement misstatements and disclosure omissions in a timely manner.

 

†††††††† In their review of the Regional Officeís accounting records, auditors noted that numerous adjustments were required to present financial statements in accordance with generally accepted accounting principles.(Finding 08-1, pages 12 and 13)

 

†††††††† The auditors recommended that, as part of its internal control over the preparation of its financial statements, including disclosures, the Regional Office of Education #38 should implement a comprehensive preparation and/or review procedure to ensure that the financial statements, including disclosures, are complete and accurate. Such procedures should be performed by a properly trained individual(s) possessing a thorough understanding of applicable generally accepted accounting principles, GASB pronouncements, and knowledge of the Regional Office of Educationís activities and operations.

 

†††††††† The Regional Office of Education #38 responded that it understands the nature of this finding and realizes the circumstance is not unusual in an organization of its size.Management is currently confident with the abilities of the accounting staff to prepare cash basis financial information as needed for reporting throughout the year.Management will review year end reporting controls annually and investigate the cost of training staff to reach an appropriate level of expertise to do a comprehensive preparation and/or review of financial statements.Management will pursue additional training when it is considered cost beneficial since training costs would take away from the funds available to provide educational services for the schools in the region.

 

 

UNINSURED DEPOSITS IN BANK

 

†††††††† The Regional Office of Education #38ís funds deposited at a financial institution exceeded the Federal Deposit Insurance Corporation (FDIC) insured limit by $46,853 and no additional collateral was obtained.The Public Funds Deposit Act, (30 ILCS 225/1) gives the authorization for deposits in excess of the federally insured limit to be covered by pledged collateral held by the financial institutionsí trust departments in the Regional Office of Education #38ís name. In addition, prudent business practice requires that all deposits held by financial institutions for the Regional Office of Education #38 be adequately covered by depository insurance or collateral. (Finding 08-2, page 14)

 

†††††††† The auditors recommended that the Regional Office of Education #38 should periodically monitor the amount of collateral held on deposits to ensure that an adequate amount is maintained.

 

†††††††† The Regional Office of Education #38 responded that it agrees with the finding and that appropriate collateralization of accounts has been confirmed by the ROE.A separate account has been established in a different bank to accommodate the ROEís new G.E.D. testing program; as a result, G.E.D. funds no longer share a bank account with any other funds.Finally, the increase in the FDIC insurance limits should cover the Regional Office of Education #38ís deposits.

 

 

AUDITORSí OPINION

 

†††††††† Our auditors state the Regional Office of Education #38ís financial statements as of June 30, 2008 are fairly presented in all material respects.

 

 

 

_____________________________________

WILLIAM G. HOLLAND, Auditor General

 

WGH:JRB

 

 

 

SPECIAL ASSISTANT AUDITORS

 

†††††††† Our special assistant auditors were Kyle E. McGinnis.