REPORT DIGEST

REGIONAL OFFICE OF EDUCATION #47 - LEE AND OGLE COUNTIES

Financial Audit (In Accordance with the Single Audit Act
and OMB Circular A-133)
For the Year Ended:  June 30, 2011

Release Date: May 2, 2012

Summary of Findings:
Total this audit: 1
Total last audit:  1
Repeated from last audit: 1

State of Illinois, Office of the Auditor General
WILLIAM G. HOLLAND, AUDITOR GENERAL

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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 www.auditor.illinois.gov

SYNOPSIS

• The Regional Office of Education #47 did not have
sufficient internal controls over the financial reporting
process.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

CONTROLS OVER FINANCIAL STATEMENT PREPARATION

The Regional Office of Education #47 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 #47 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.

Auditors, in their review of the Regional Office’s
accounting records, noted adjustments were required to
present financial statements in accordance with generally
accepted accounting principles.

Management prepared a listing of adjustments needed to
present the financial statements in accordance with
generally accepted accounting principles.  Management’s
review process of this listing, however, did not
effectively detect all of the adjustments needed. (Finding
11-1, pages 12-13)   This finding was first reported in
2009.

The auditors recommended that, as part of its internal
control over the preparation of its financial statements,
including disclosures, the Regional Office of Education #47
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
Education’s activities and operations.

The Regional Office of Education #47 responded that as part
of its internal control over the preparation of its
financial statements, the Regional Office has implemented a
comprehensive preparation and/or review procedure to ensure
that the financial statements, including disclosures, are
complete and accurate on a monthly basis.  The Regional
Superintendent will continue to review all financial
statements (including accruals) striving to be as accurate
as possible, hoping to eliminate this finding in the
future.  (For previous Regional Office response, see Digest
Footnote #1.)

AUDITORS’ OPINION

Our auditors state the Regional Office of Education #47’s
financial statements as of June 30, 2011 are fairly
presented in all material respects.

WILLIAM G. HOLLAND
Auditor General

WGH:JRB

AUDITORS ASSIGNED:  Winkel, Parker & Foster, CPA PC were
our special assistant auditors.

DIGEST FOOTNOTES

#1: Controls Over Financial Statement Preparation -
Previous Regional Office Response

In its prior response in 2010, the Regional Office of
Education #27 responded that as part of its internal
control over the preparation of its financial statements,
the Regional Office has implemented a comprehensive
preparation and/or review procedure to ensure that the
financial statements, including disclosures, are complete
and accurate on a monthly basis.  The Regional
Superintendent will continue to review all financial
statements (including accruals) striving to be as accurate
as possible, hoping to eliminate this finding in the
future.