REPORT DIGEST

REGIONAL OFFICE OF EDUCATION #26: FULTON,
HANCOCK, MCDONOUGH, AND SCHUYLER COUNTIES

FINANCIAL AUDIT
FOR THE YEAR ENDED JUNE 30, 2025

Release Date:  March 30, 2026

FINDINGS THIS AUDIT: 2

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 0 -- 0
Category 2:  1 -- 0 -- 1
Category 3:  1 -- 0 -- 1
TOTAL:  2 -- 0 – 2

FINDINGS LAST AUDIT: 0

State of Illinois, Office of the Auditor
General
FRANK J. MAUTINO, AUDITOR GENERAL

To obtain a copy of the Report contact:
Office of the Auditor General, 400 West
Monroe, Suite 306, Springfield, IL
62704-9849
(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

• (25-1) The Regional Office of Education
#26 did not have sufficient internal
controls over the financial reporting
process.

• (25-2) The Regional Office of Education
#26 did not provide completed financial
statements in an auditable form by the
August 31 deadline.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

CONTROLS OVER THE FINANCIAL STATEMENT
PREPARATION

The Regional Office of Education #26 (ROE)
did not have
sufficient internal controls over the
financial reporting
process. During our review of ROE 26’s
financial information prepared by the ROE,
we noted that the Institute Fund met the
criteria as a major fund; however, this
fund was reported within the aggregate of
nonmajor funds. The ROE subsequently
revised its financial statements to present
the Institute Fund as a major fund.

While ROE 26 maintains controls over the
processing of most accounting transactions,
there are not sufficient controls over the
preparation of the financial statements for
management or employees in the normal
course of performing their assigned
functions to prevent, or detect and
correct, financial statement misstatements
and disclosure omissions in a timely
manner.

The School Code 105 ILCS 5/2-3.17a allows a
Regional Office of Education or Educational
Service Center to utilize a cash basis,
modified cash basis or generally accepted
accounting principles (GAAP) basis of
accounting to prepare the financial
statements for audit. ROE #26 has chosen to
utilize the cash basis of accounting for
financial statement reporting. The ROE is
required to maintain a system of controls
over the preparation of financial
statements in accordance with its selected
basis of accounting.

GASB Statement No. 34, Basic Financial
Statements – and Management’s Discussion
and Analysis - for State and Local
Governments (Statement), states the focus
of governmental and proprietary fund
financial statements is on major funds.
Fund statements should present the
financial information of each major fund in
a separate column. Nonmajor funds should be
aggregated and displayed in a single
column.

The reporting government’s main operating
fund (the general fund or its equivalent)
should always be reported as a major fund.
Other individual governmental and
enterprise funds should be reported in
separate columns as major funds based on
these criteria:

a. Total assets, liabilities, revenues, or
expenditures/expenses of that individual
governmental or enterprise fund are at
least 10 percent of the corresponding total
(assets, liabilities, and so forth) for all
funds of that category or type (that is,
total
governmental or total enterprise funds),
and

b. Total assets, liabilities, revenues, or
expenditures/expenses of the individual
governmental fund or enterprise fund are at
least 5 percent of the corresponding total
for all governmental and enterprise funds
combined.

In addition to funds that meet the major
fund criteria, any other governmental or
enterprise fund that the government’s
officials believe is particularly important
to financial statement users (for example,
because of public interest or consistency)
may be reported as a major fund.

The Regional Office officials indicated the
exception was due to oversight. (Finding
25-1, pages 11-12)

The auditors recommended as part of
internal control over the preparation of
financial statements, the ROE 26 should
implement comprehensive preparation
procedures to ensure the financial
statements are complete and accurate. These
procedures should be performed by a
properly trained individual(s) possessing a
thorough understanding of applicable cash
basis of accounting principles, GASB
pronouncements, and knowledge of the ROE
26’s activities and operations.

ROE Response: The Regional Office of
Education #26 will, as part of internal
control over the preparation of financial
statements, implement comprehensive
preparation procedures to ensure the
financial statements are complete and
accurate. These procedures will be
performed by a properly trained
individual(s) possessing a thorough
understanding of the applicable cash basis
of accounting principles, GASB
pronouncements, and knowledge of the ROE’s
activities and operations.

DELAY OF AUDIT

The Regional Office of Education #26 (ROE)
did not provide
completed financial statements in an
auditable form by the
August 31, 2025, deadline. The completed
June 30, 2025
financial statements were provided to the
auditors on November 5, 2025.

The ROE is subject to 105 ILCS 5/2-3.17a
which requires the Auditor General’s office
to cause an audit to be made, as of June
30th of each year, of the financial
statements of all accounts, funds and other
moneys in the care, custody or control of
the regional superintendent of schools of
each educational service region in the
State and of each educational service
center established in the School Code. The
audit is to be conducted in accordance with
Generally Accepted Government Auditing
Standards. The ROE may utilize a cash
basis, modified cash basis, or generally
accepted accounting principles (GAAP) basis
of accounting to prepare the financial
statements for audit. The ROE has chosen
the cash basis of accounting for financial
reporting.
In accordance with 105 ILCS 5/2-3.17a, the
Auditor General has promulgated
administrative rules and regulations to
govern this process. Those rules, 74 Ill.
Adm. Code 420.320 (c) (2), state that for
audit purposes, each regional office of
education and educational service center
shall make available to the Auditor General
or his designee all books and records
deemed necessary to make and complete the
required audits. The records shall be in
auditable form by August 15th of the
succeeding fiscal year. Financial reports
are to be available no later than August
31st in order for the annual audit to be
completed by an independent auditor
selected by the Auditor General. In
addition, prudent business practices and
transparency require timely preparation and
completion of financial statements.

Regional Office officials indicated the
delay was due to competing priorities of
the accounting firm preparing the ROE’s
financial statements.  (Finding 25-2, pages
13-14)

The auditors recommended the ROE should
implement
procedures to ensure compliance with 105
ILCS 5/2-3.17a and
74 Ill. Adm. Code 420.320 (c)(2). These
financial statements
need to be presented to the Auditor
General’s independent
auditors for audit by the August 31
deadline.

ROE Response: The Regional Office will
implement procedures to ensure compliance
with 105 ILCS 5/2-3.17a and 74 Ill. Adm.
Code 420.320 (c) (2). These financial
statements will be presented to the Auditor
General’s independent auditors for audit in
a timely manner to the best of our ability.

AUDITORS’ OPINION

Our auditors state the Regional Office of
Education #26’s financial statements as of
June 30, 2025 are fairly presented in all
material respects.

This financial audit was conducted by the
firm of Adelfia LLC.

TRICIA WAGNER
Division Director

This report is transmitted in accordance
with Section 3-14 of the Illinois State
Auditing Act.

FRANK J. MAUTINO
Auditor General

FJM:JRB