REPORT DIGEST

ILLINOIS STATE BOARD OF INVESTMENT

FINANCIAL AUDIT
FOR THE YEAR ENDED JUNE 30, 2025

Release Date:  March 26, 2026

FINDINGS THIS AUDIT: 1

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

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

INTRODUCTION

This digest covers the Illinois State Board
of Investment’s (ISBI) financial audit as
of and for the year ended June 30, 2025.
The ISBI’s compliance examination covering
the two years ended June 30, 2025, will be
issued at a later date.

SYNOPSIS

• (25-01) ISBI did not have adequate
controls in place to track and record
receivables and payables related to
investment activity during the period.

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

UNRECONCILED DIFFERENCES INCLUDED IN
PENDING INVESTMENT ACTIVITY

The Illinois State Board of Investment
(ISBI) did not have adequate controls in
place to track and record receivables and
payables related to investment activity
during the period.

During the audit of the financial
statements for the year ended June 30,
2025, we noted that ISBI’s payables for
investments purchased and receivables for
investments sold, did not reconcile with
the amounts reported by the asset
custodian. ISBI’s reported balances
included other payables and other
receivables which represented internal
money movements between investment funds/
managers, which are internal balances and
should be eliminated for financial
reporting purposes. The impact of the
unreconciled differences resulted in an
uncorrected misstatement in the financial
statements of $99,072,159, including
$98,910,967 impacting the ISBI Member
System and $161,192 impacting the Illinois
Power Agency Trust Fund as follows:

• Overstatement of payables for investments
purchased
• Understatement of net increase in fair
value of investments/net position

In addition to the uncorrected misstatement
noted above, on the recommendation of its
auditors, ISBI did reclassify a trial
balance account for a balance that was
classified as a receivable for investments
sold to a payable for investments
purchased. The reclassification reduced
both amounts by $27,712,272. This
reclassification had no impact on net
position. (Finding 1, pages 28-29)

We recommended ISBI establish internal
controls to ensure that all investment-
related balances are properly reconciled to
the records of the asset custodian and are
properly recorded within the financial
statements.

ISBI partially accepted our
recommendations. ISBI stated that it agreed
the variance described in the finding was
accurate but disagreed with the
characterization that the variance was the
result of improper controls.

AUDITOR’S OPINIONS

The auditors stated the financial
statements of ISBI as of and for the year
ended June 30, 2025, are fairly stated in
all material respects.

This financial audit was conducted by RSM
US LLP.

COURTNEY DZIERWA
Division Director

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

FRANK J. MAUTINO
Auditor General

FJM:dmg