REPORT DIGEST

 

KANKAKEE RIVER VALLEY AREA AIRPORT AUTHORITY

 

FINANCIAL AUDIT

AND COMPLIANCE EXAMINATION

For the Year Ended:

June 30, 2007

 

Summary of Findings:

 

Total this audit                    1

Total last audit                    1

Repeated from last audit     1

 

Release Date:

May 27, 2008

 

 

 

 

 

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 Authority failed to comply with the Kankakee River Valley Area Airport Authority Act.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

{Expenditures and Activity Measures are summarized on the reverse page.}

 

KANKAKEE RIVER VALLEY AREA AIRPORT AUTHORITY

FINANCIAL AUDIT AND COMPLIANCE EXAMINATION

For The Year Ended June 30, 2007

 

 

PROPRIETARY FUND FINANCIAL OPERATIONS

 

FY 2007

 

FY 2006

PROPRIETARY FUND EXPENSES

 

 

      OPERATING EXPENSES

 

 

            Bank Service Charge.........................

       96

       96

               Total Operating Expenses................

       96

       96

 

 

 

            Operating Income (Loss)

    (96)

    (96)

 

 

 

PROPRIETARY FUND REVENUES

 

 

      NONOPERATING REVENUES

 

 

            Interest Income.................................

         7

         7

                  Total Nonoperating Revenues.......

         7

         7

Change in Net Assets

    (89)

    (89)

Net Assets, July 1

  2,180

  2,194

Net Assets, June 30

$2,091

$2,180

CONTRIBUTED SERVICES (unaudited)

 

 

            Contributed Facilities and Services......

$3,935

$2,535

   

 

  

 

 

 

 

 

SELECTED PROPRIETARY FUND BALANCES

JUNE 30,

2007

JUNE 30,

2006

Cash............................................................

$2,091

$2,180

Net Assets...................................................

$2,091

$2,180

 

AGENCY CHAIRMAN

During Audit Period:  Mr. David Wallace (7/1/06-4/30/07), Vacant (4/30/07-2/28/08)

Currently:  Mr. Warren Ouwenga (effective 2/28/08)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Failure to file annual report with the Governor

 

 

Four Board vacancies

 

 

 

 

 

Failure to file constitutional oaths and bonds

 

 

INTRODUCTION

 

The Kankakee River Valley Area Airport Authority was created September 10, 1990 as a result of the Kankakee River Valley Area Airport Authority Act (70 ILCS 15 et seq.).  Its mission is to facilitate safe and convenient air travel and transportation to and from the Kankakee River Valley by acquisition or construction and operation of one or more airports. 

 

This digest covers the financial audit and compliance examination of the Authority for the year ended June 30, 2007.  The Authority received no appropriations from the Illinois General Assembly, and funds were not held in the State Treasury.  The Authority was financed solely through contributions from private sources and interest income received from locally held funds. 

 

 

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

 

NONCOMPLIANCE WITH KANKAKEE RIVER VALLEY AREA AIRPORT AUTHORITY ACT

 

      The Authority failed to comply with the Kankakee River Valley Area Airport Authority Act (Act).  We noted the following deficiencies:

 

·        The Authority did not create and submit a written statement and report to the Governor covering its activities for the preceding fiscal year by November 15th.

·        The Authority had four vacancies, one requiring an appointment from the Kankakee County Board and three requiring appointments from the Will County Board.  Along with the unfilled vacancy at the end of fiscal year 2006, one Authority member’s term expired and 2 resignations were tendered during fiscal year 2007.  These appointments were not filled by June 30, 2007.   

·        One of 7 (14%)  Authority members did not file bonds in the amount of $100,000 with the Office of the Secretary of State.  One of 7 (14%)  Authority members did not file their constitutional oath of office with the Office of the Secretary of State. 

·        Due to the multiple vacancies, the Authority was not able to meet nor were they able to produce documentation to Auditors in a timely manner.  Auditors first contacted the prior chairman in October, 2007.  Auditors were unable to obtain documentation for fiscal year 2007 until March 10, 2008.

 

We recommended the Authority prepare and submit a written statement and report covering its activities over the preceding fiscal year to the Governor by November 15th of each year as required.  In addition, we recommended the Authority strengthen controls to ensure the Authority obtains the constitutional oath of office and bond in the penal sum of $100,000 for appointed members and that the oaths and bonds are filed with the Office of the Secretary of State. 

 

Further, due to the Authority’s inactivity over the past several years and their inability to maintain eight appointed board members, we recommended the Authority either ensure members are appointed in accordance with the Act or seek legislative remedy from the General Assembly.  (Finding 1, pages 9-10)  This finding was first reported in 2005.

 

      Authority officials stated that they agree with the finding and are working to fill vacancies and update constitutional oaths and insurance bonds for the members. 

 

      Authority officials further stated that past attempts to seek legislative remedy have been unsuccessful.  The Authority will continue to seek assistance in resolving the future existence of the Authority.  (For the previous agency response, see Digest footnote #1.)

 

 

AUDITORS’ OPINION

 

Our auditors stated the financial statements of the Authority as of June 30, 2007, and for the year ended, are fairly presented in all material respects.

 

STATE COMPLIANCE EXAMINATION – ACCOUNTANT’S REPORT

 

      The auditors qualified their report on State Compliance for finding 07-1.  Except for the noncompliance described in this finding, the auditors state the Authority complied, in all material respects, with the requirement described in the report.

 

 

 

                       ____________________________________

                  WILLIAM G. HOLLAND, Auditor General

 

WGH:ps

 

AUDITORS ASSIGNED

 

This audit was performed by the staff of the Office of the Auditor General.

 

DIGEST FOOTNOTES

 

#1 The Kankakee River Valley Area Airport Authority failed to comply with the Kankakee River Valley Area Airport Authority Act.

The Authority concurs with the finding with the following response to the deficiencies:

-          The Authority meets very infrequently and the failure to file the report to the Governor was an oversight.

-          Will County Board has been unable to make an appointment thus far.  As Chairman, I have been asked to submit a recommendation for consideration.

-          The documentation for the two appointments has not been forwarded to the Authority.  The requests will be made to the proper appointing authorities.

-          As Chairman, I was unaware these were requirements.  Previously, the Authority had an administrative assistant who handled these matters.  The bonds and constitutional oaths will be submitted as soon as possible.