REPORT DIGEST

REGIONAL OFFICE OF EDUCATION #43

MARSHALL/PUTNAM/ WOODFORD COUNTIES

FINANCIAL AUDIT

For the Year Ended:

June 30, 2004

Summary of Findings:

Total this audit                          2

Total last audit                          2

Repeated from last audit           1

Release Date:

March 8, 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

·        One person has primary responsibility for most of the accounting and financial duties for the Regional Office of Education #43. As a result, the aspects of internal control, which rely on adequate segregation of duties, are missing. 

·        The Regional Office of Education #43 did not comply with certain statutory administrative requirements.

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

FY 2004

FY 2003

TOTAL REVENUES

$269,288

$259,904

Local Sources

$58,386

$32,242

% of Total Revenues

21.68%

12.41%

State Sources

$208,066

$226,142

% of Total Revenues

77.27%

87.01%

Federal Sources

$2,836

$1,520

% of Total Revenues

1.05%

.58%

TOTAL EXPENDITURES

$275,152

$260,564

Salaries and Benefits

$220,703

$222,616

% of Total Expenditures

80.21%

85.44%

Purchased Services

$35,870

$34,510

% of Total Expenditures

13.04%

13.24%

All Other Expenditures

$18,579

$3,438

% of Total Expenditures

6.75%

1.32%

TOTAL NET ASSETS¹

$24,413

$30,277

INVESTMENT IN CAPITAL ASSETS¹

$648

$883

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 Rolland D. Marshall

Currently:  Honorable Rolland D. Marshall

One person has primary responsibility for most of the accounting and financial duties for the Regional Office of Education #43.

The Regional Office of Education #43 did not comply with certain statutory administrative requirements.

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

INADEQUATE SEGREGATION OF DUTIES

        One person has primary responsibility for most of the accounting and financial duties for the Regional Office of Education #43.  As a result, the aspects of internal control, which rely on adequate segregation of duties, are missing.  The bookkeeper pays all bills, records all transactions and reconciles the monthly bank statement.  Inadequate segregation of duties could limit the effectiveness and efficiency of the internal control system.

        The Regional Superintendent of Schools is responsible for establishing and maintaining an internal control system to prevent errors and/or irregularities  (Finding 04-1, page 13).  This finding is repeated from our 2003 audit. 

        The Regional Office of Education #43 accepted the recommendation to improve internal controls.  The Regional Superintendent plans to reassign duties between the bookkeeper, secretary and himself to achieve improved segregation of duties.  (For previous Regional Office response, see Digest Footnote #1.)

COMPLIANCE WITH STATUTORY REQUIREMENTS

        The Regional Office of Education #43 did not comply with certain statutory administrative requirements.  For example, the Illinois School Code (105 ILCS 5/3-6) required the Regional Superintendent to report, in writing, to the county board on or before January 1 of each year, stating:  (1) the balance on hand at the time of the last report, and all receipts since that date, with sources from which they were derived; (2) the amount distributed to each of the school treasurers in his or her county; and (3) any balance on hand. 

        The School Code (105 ILCS 5/3-12) also 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 Office’s Institute Fund.  According to Regional Office management, they were unaware of these requirements and had not submitted the required reports.  (Finding 04-2, page 14).

            The Regional Office of Education #43 accepted the recommendation to submit the required reports. 

                             AUDITORS’ OPINION

       Our auditors state the Regional Office of Education #43’s financial statements as of June 30, 2004 are fairly presented in all material respects.

_____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:JRB:ro

SPECIAL ASSISTANT AUDITORS

        Our special assistant auditors were Ginoli & Company LTD.

DIGEST FOOTNOTES

#1: INADEQUATE SEGREGATION OF DUTIES --  Previous Regional Office Response

In the prior response in 2003, the Regional Superintendent accepted the recommendation, responding that he plans to reassign duties between the bookkeeper, secretary and himself to achieve improved segregation of duties. 

Complete Regional Office responses to prior findings are available upon request from the Auditor General’s Office.