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Auditor General Reports

Comptroller's office

An accurate accounting system to show the true financial position of the state was not implemented as fast as it should have been in the comptroller's office. Such was the basic finding of an auditor general's compliance audit, issued in January for the fiscal year that ended March 31, 1977. The new Comptroller's Uniform Statewide Accounting System (CUSAS), recommended by the comptroller's office, should be fully implemented, the auditor general concluded.

The present system for estimating the state's financial condition is based on a cash accounting system, so that when money is put in a state account or when it is spent, it is added or subtracted from that account. CUSAS, however, requires accounting on a modified accrual basis, whereby debts are recognized in accounts as soon as incurred. For instance, as soon as a construction firm signs a contract for work, the amount of payment stipulated in the contract is immediately accounted as debt.

In recommending implementation of CUSAS, the audit report said, "We recognize that such a plan involved more than changes in CUSAS and could encompass far-reaching changes in the financial management responsibilities within Illinois State Government." A spokesman for the comptroller's office. Tony Abel, stressed that the audit covered only about two months' activities under the administration of present Comp. Michael J. Bakalis. "We can hardly be blamed for the shortcomings pointed to in the audit," Abel said.

"The comptroller currently states he will soon appoint a CUSAS Review Task Force with responsibility for comprehensively reviewing the existing CUSAS system for compliance with appropriate generally-accepted accounting principles," the audit report said.

The auditor also recommended that the comptroller seek clarification about CUSAS from the legislature. Do CUSAS requirements apply to subjects other than reports by agencies to the comptroller, and the comptroller's method of recording funds in state accounts? That must be determined, the auditor general said.

Weaknesses were found in the comptroller's pre-audit controls of spending. Two cases were discovered where the state made payments for debts that may have been illegally incurred.

The auditor general recommended that the comptroller should support legislation giving the comptroller the responsibility for the certification of the financial information relating to the state's bonded indebtedness.

Board of Elections

An audit of the State Board of Elections showed that steps had been taken in compliance with a prior audit completed in March 1976 to consolidate positions, reduce salaries and reevaluate classifications of administrators and field coordinators. From February 1976 to February 1978 the board cut the number of its employees from 102 to 85. Yet the auditors said in their February report that they still believe management can achieve more economies in personal services. They also suggest that a long-term planning program be developed as soon as the new 8-member board is appointed in accordance with recent legislation.

An audit of the Jacksonville Mental Health and Development Center, released in February, revealed that contrary to prior recommendations the center has continued to purchase substantial amounts of linens for the Lincoln Developmental Center. The auditors also found that the center had more than $100,000 of inactive or slow-moving (over two-year supply on hand) inventory items. The center has agreed to review these inventories and take action to sell or transfer the surplus items. The audit also led to the arrest of an employee in charge of the Workshop Fund who is accused of diverting $6,000 for his personal use.

An audit of the William W. Fox Children's Center, also released in February, showed that the center is lax in complying with provisions in applicable laws, regulations or generally accepted procedures in three areas. First, the center does not always comply with provisions in the Act for Payment of Public Money into the State Treasury (Ill. Rev. Stat., Ch. 127, sec. 171) which requires that receipts accumulated to less than $500 be deposited on the next succeeding first or fifteenth of each month. Second, the center is not reconciling its property records with those of the Division of Property Control. Department of Administrative Services, as was established in the

State stix

The comptroller's monthly report showed in January the general funds average daily balance was $74 million; end of month balance $95 million; combined funds average daily available balance $154 million .... The maximum interest rate for loans secured by residential real estate in March was 10 per cent. In March 1977 the maximum rate was 9.25 per cent .... Unemployment statistics for January and February were not available due to some problems in using the new system of computation, according to persons at the Illinois Department of Labor. The new system is considered more accurate since it includes persons whose unemployment benefits have run out but who are still out of work.

April 1978/Illinois Issues/29


State Property Control Act (Ill. Rev. Stat., Ch. 127, secs. 133bl et seq.}. Third, the center is not complying with instructions in the Department of Mental Health and Developmental Disabilities' "Pharmacy Service Manual" for taking quarterly inventories of drugs and related supplies. Corrective measures are being taken.

In the Illinois Institute for Developmental Disabilities an audit report, released in February, found 97 regional office employees included on the payroll. "These employees neither performed services for the Institute nor were under its control," the auditor general said. The payroll cost for these employees was $1,395,000 in fiscal 1977.

All three institutes mentioned above are administered by the Illinois Department of Mental Health and Developmental Disabilities.

The auditor general's report of the Illinois Arts Council, issued January 20, was critical of the council for operating outside the state personnel code and for the failure often of its members to file obligatory disclosure statements. The arts council audit questioned a $25,000 debt contracted by the council foundation for an architectural bicentennial program, and receipt of federal grants outside the legislative appropriation process.

Also reproved by the auditor general in a January 20 report was the Illinois Fire Protection Personnel Standards and Education Commission, which was found to have destroyed records about an employee's alleged "gross misuse of a state vehicle." As a result of the destruction of the discharged employee's records, it was impossible for the auditor general to "determine the full extent of questionable claims and purchases or an amount which the state may have been entitled to recover."

The same audit uncovered errors in completion of travel vouchers by the commission. The auditor general said vouchers weren't submitted regularly and didn't specify the purpose or method of travel used.

Other reports

A loan/lease agreement entered into by Chicago State University and its foundation is in violation of the Illinois Constitution, the auditor general reported in January. The university should seek legislative approval for the agreement, it was recommended.

The Illinois Housing Development Authority should close its revolving payroll account with the state, and should present to the pension board the facts surrounding eligibility of its employees for the State Employees' Retirement System. The housing authority does not qualify as a department as defined in the pension code, the auditor said in January.

No major adverse findings were presented in January audit reports for Illinois Educational Facilities Authority, Illinois State University Foundation, State University Retirement System, General Assembly Retirement System, Judges Retirement System, Legislative Audit Commission and Board of Governors of State Colleges and Universities.

February reports showed no problems or minor problems for: Illinois Transportation Study Commission, Department of Revenue, Chicago State University's Revenue Bond Fund, Illinois Mental Health Institutes, Water Resources Commission, Commission to Visit and Examine State Institutions, State Employees Group Insurance Advisory Commission and St. Louis Metropolitan Area Airport Authority.

30/ April 1978/ Illinois Issues


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