REPORT DIGEST

 

REGIONAL OFFICE OF EDUCATION # 41

 

MADISON COUNTY

 

FINANCIAL AND COMPLIANCE AUDIT

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

 

For the Year Ended:

June 30, 2003

 

Summary of Findings:

 

Total this audit                          6

Total last audit                          1

Repeated from last audit           0

 

Release Date:

 

 

 

 

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 TDD (217) 524-4646

 

This Report Digest is also available on

the worldwide web at

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

 

 

 

 

 

 

 

SYNOPSIS

 

 

·        The general ledger did not agree to the reconciled bank balance by $21,788 at June 30, 2003.

 

  • The general ledger was inaccurate and did not agree to the State reported revenues.

 

  • The same person has the responsibility for inputting invoices for payment, the ability and the authority to print the checks, and access to a signature stamp to “sign” the checks without proper review or oversight. 

 

  • The Regional Office of Education #41 does not maintain detailed fixed asset records. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 


REGIONAL OFFICE OF EDUCATION # 41

 MADISON COUNTY

 

FINANCIAL AND COMPLIANCE AUDIT

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

For the Year Ended June 30, 2003

 

 

 

 

FY 2003

FY 2002

TOTAL REVENUES

$5,694,296

$7,155,520

Local Sources

$1,553,876

$1,551,039

% of Total Revenues

27.29%

21.68%

State Sources

$2,119,840

$2,635,809

% of Total Revenues

37.23%

36.84%

Federal Sources

$2,020,580

$2,968,672

% of Total Revenues

35.48%

41.49%

 

TOTAL EXPENDITURES

$5,767,973

$7,298,835

Salaries and Benefits

$2,899,172

$2,696,759

% of Total Expenditures

50.26%

36.95%

Purchased Services

$1,879,255

$2,788,606

% of Total Expenditures

32.58%

38.21%

All Other Expenditures

$989,546

$1,813,470

% of Total Expenditures

17.16%

24.85%

 

 

 

COST OF PROPERTY AND EQUIPMENT

 

$543,294

 

$485,347

 

* Percentages may not add due to rounding.

 

 

REGIONAL SUPERINTENDENT 

During Audit Period:  Honorable Harry Briggs

Currently:  Honorable Harry Briggs


 

 

 

 

 

 

 

 

 


The general ledger did not agree to the reconciled bank balance by $21,788 at June 30, 2003.

 

 

 

 

 

 

 

 

 

 

 

 

 


The general ledger was inaccurate and did not agree to the State reported revenues.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


The same person has the responsibility for inputting invoices for payment, the ability and the authority to print the checks, and access to a signature stamp to “sign” the checks without proper review or oversight. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


The Regional Office of Education #41 does not maintain detailed fixed asset records. 

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

 

 

BANK RECONCILIATIONS ARE NOT RECONCILED TO THE GENERAL LEDGER

 

       Bank statements are reconciled monthly, however, they are not reconciled to the general ledger cash accounts.  Several deposits were incorrectly posted to the general ledger.  The general ledger did not agree to the reconciled bank balance by $21,788 at June 30, 2003.

 

       Bank reconciliations should agree to the cash accounts in the general ledger (Finding 03-1, page 11)

 

        The Regional Office of Education #41 accepted the recommendation.  The Accounting Assistant will  perform the bank reconciliations and the Head Accountant will verify all reconciliations are balanced and accurately reflected on the general ledger.  The Assistant Regional Superintendent will ensure all reconciliations are performed and balanced.

 

 

INACCURATE GENERAL LEDGER

 

        The general ledger was inaccurate and did not agree to the State reported revenues.  The differences comprised of a deposit for $9,321 that was not posted, a deposit for $7,441, which was posted incorrectly to two funds, and a deposit for $6,118, which was incorrectly posted twice.

 

        The general ledger totals should agree or be reconciled to the grant report totals for all grants (Finding 03-2, page 12).

 

         The Regional Office of Education #41 accepted the recommendation and will ensure that the revenues and expenditures per the general ledger agree with the granting agency.

 

 

INADEQUATE INTERNAL CONTROLS OVER CASH DISBURSEMENTS

 

        The same person has the responsibility for inputting invoices for payment, the ability and the authority to print the checks, and access to a signature stamp to “sign” the checks without proper review or oversight.  Without the proper segregation of duties over cash disbursements, the Regional Office of Education is susceptible to unauthorized or fraudulent payments with little chance of detection.  Someone should be reviewing all checks and agreeing the checks to invoices, as part of the signatory process, before the checks are mailed to the vendors.

 

       The Regional Superintendents of Schools is responsible for establishing and maintaining an internal control system to prevent errors and/or irregularities (Finding 03-5, page 15).

 

       The Regional Office of Education #41 accepted the recommendation and will establish an internal control system to prevent errors and/or irregularities.  At a minimum, the responsibility for inputting invoices for payment will be segregated from the printing and signing of checks.  In addition, all checks and agreeing invoices will be reviewed as part of the signatory process before checks are mailed to the payee.

 

 

INADEQUATE CONTROLS OVER PROPERTY

 

        The Regional Office of Education #41 does not maintain detailed fixed asset records.  There is no policy in place which requires any purchases of fixed assets made throughout the year to be recorded in the present fixed asset system.  Also, there is no policy for assets to be numerically tagged for proper accountability and control. 

 

        The ROE Accounting Manual requires each ROE to maintain detailed fixed asset records for both accounting purposes, as well as insurance purposes, for fixed assets costing $500 or more.  (Finding 03-6, pages 16-17)

 

        The Regional Office of Education #41 accepted the recommendation and will implement an asset tagging system.  Once the tagging system is in place, a detailed listing of all fixed assets can be generated and depreciation will be calculated.  Any assets purchased will now be tagged at the time of delivery and entered into the detailed fixed asset system.  An annual physical inventory of all assets will be conducted. 

 

 

OTHER FINDINGS

 

         The remaining findings are reportedly being given attention by Regional Office of Education #41.  We will review progress toward the implementation of our recommendations during the next audit.

 

 

AUDITORS’ OPINION

 

      Our auditors state the Regional Office of Education #41’s financial statements as of June 30, 2003 are fairly presented in all material respects.

 

 

 

_____________________________________

WILLIAM G. HOLLAND, Auditor General

 

WGH:JRB

 

 

 

SPECIAL ASSISTANT AUDITORS

 

        Our special assistant auditors were J.W. Boyle & Co., Ltd.