FY11-Labor-Comp-Full

              State of Illinois
ILLINOIS DEPARTMENT OF LABOR
COMPLIANCE EXAMINATION
For the Two Years Ended June 30,2011
Performed as Special Assistant Auditors
for the Auditor General, State of Illinois
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPLIANCE EXAMINATION
For the Two Years Ended June 30,2011
TABLE OF CONTENTS
Page
Agency Officials 1
Management Assertion Letter 2
Compliance Report
Summary 3
Accountant's Reports
Independent Accountants' Report on State Compliance, on Internal
Control Over Compliance, and on Supplementary Information for
State Compliance Purposes 5
Schedule of Findings
Current Findings - State Compliance 8
Prior Findings Not Repeated 39
Supplementary Information for State Compliance Purposes
Summary 40
Fiscal Schedules and Analysis
Schedule of Expenditures ofFederal Awards 41
Notes to Schedule ofExpenditures of Federal Awards 42
Schedule of Appropriations, Expenditures and Lapsed Balances 43
Comparative Schedule of Net Appropriations, Expenditures and Lapsed
Balances 47
Schedule of Changes in State Property (Not Examined) 49
Comparative Schedule of Cash Receipts (Not Examined) 50
Reconciliation Schedule of Cash Receipts to Deposits Remitted to the
State Comptroller (Not Examined)
Analysis of Significant Variations in Expenditures 55
Analysis of Significant Variations in Receipts 58
Analysis of Significant Lapse Period Spending 59
Analysis of Accounts Receivable (Not Examined) 60
Analysis of Operations
Agency Functions and Planning Program 61
Average Number of Employees 64
Service Efforts and Accomplishments (Not Examined) 65
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
AGENCY OFFICIALS
Director ( 4/16/11 to Current)
Director (7/1/09 to 4/16/11)
Assistant Director ( 4/29111 to Current)
Assistant Director (7 /1109 to 4/29/11)
Legal Counsel (12/6/10 to Current)
Legal Counsel (711/09 to 12/6/10)
Fiscal Officer (211 /12 to Current)
Fiscal Officer (9/111 0 to 1/31/12)
Fiscal Officer (7 11/09 to 9/111 0)
Department offices are located at:
900 South Spring Street (fiscal records location)
Springfield, IL 62704
160 North LaSalle Street, Suite C-1300
Chicago, IL 60601
State Regional Office
23 09 West Main
Marion, IL 62959
1
Mr. Joseph Costigan
Ms. Catherine Shannon
Vacant
Mr. Bert Rodriguez
Ms. Katherine Anthony
Mr. Michael Haggerty
Ms. Tammy Miner
Dr. Joan Small
Mr. Mike Layden
Pat Quinn
Governor
CliftonLarsonAllen LLP
301 SW Adams, Suite 900
Peoria, IL 61615-1835
Ladies and Gentlemen:
ILLINOIS DEPARTMENT OF LABOR
Joseph Costigan
Director
February 14,2012
We are responsible tor the identification ot: and compliance with, all aspects of laws. regulations.
contracts, or grant agreements that could have a material eftect on the operations of the Illinois
Depmtment of Labor (the "Department"). We are responsible for and we have established and maintained
an efiective system of, internal controls over compliance requirements. We have pertormed an evaluation
of the Department's compliance with the following assertions during the two years ended June 30, 2011.
Based on this evaluation, we assert that during the two years ended June 30, 2011, the Department has
materially complied with the assertions below.
A. The Department has obligated, expended, received and used public funds of the State in
accordance with the purpose tor which such funds have been appropriated or otherwise authorized
bylaw.
B. The Department has obligated, expended, received and used public funds of the State in
accordance with any limitations, restrictions, conditions or mandatory directions imposed by Jaw
upon such obligation, expenditure, receipt or use.
C. The Department has complied, in all material respects, with applicable laws and regulations,
including the State uniform accounting system, in its financial and fiscal operations.
D. State revenues and receipts collected by the Department are in accordance with applicable laws
and regulations and the accounting and recordkeeping of such revenues and receipts is fair,
accurate and in accordance with law.
E. Money or ne~otiable securities or similar assets handled by the Department on behalf of the
State or held m trust by the Department have been properly and legally administered, and the
accounting and recordkeeping relating thereto is proper, accurate and in accordance with law.
Yours very truly,
Illinois Department of Labor
Mkfwl'l r\ Bifandk Building
I h() North L.1Sallc. Suire C-l.lOO
('hkup-o. Illinois 1)0601 -~ 150
c.1!2) 79:1-2!!00
Fax: 1~12!793-5257
unsel
i)(Xl South Spring SII~CI
Springfield. lllinob t'>2704
(217) 782-6206
l';~x : (217J782-!l.~9()
2
Regional Oflicc Building
2.\09 We~ l Main Street. Suire II 'i
Marion. Illinois 62959
(611099:\-709()
Fax: (61 H) 993-725H
COMPLIANCE REPORT
SUMMARY
The compliance testing performed during this examination was conducted in accordance
with Government Auditing Standards and in accordance with the Illinois State Auditing Act.
ACCOUNTANTS' REPORTS
The Independent Accountants' Report on State Compliance, on Internal Control Over
Compliance and on Supplementary Information for State Compliance Purposes does not contain
scope limitations, disclaimers, or other significant non-standard language.
SUMMARY OF FINDINGS
Number of
Findings
Repeated findings
Current
Report
10
9
Prior
Report
11
9
Prior recommendations implemented
or not repeated 2 7
Details of findings are presented in the separately tabbed report section of this report.
Item No. Page
11-1 8
11-2 14
11-3 16
11-4 22
11-5 24
SCHEDULE OF FINDINGS
Description Finding Type
FINDINGS (STATE COMPLIANCE)
Inadequate controls over revenues Material Weakness and
Material Noncompliance
Inadequate controls over accounts receivable Material Weakness and
records and reporting Material Noncompliance
Property control weaknesses Material Weakness and
Material Noncompliance
Inadequate controls over Special State Trust Material Weakness and
Fund Material Noncompliance
Inadequate controls over voucher processing Material Weakness and
Material Noncompliance
3
11-6 27
11-7 29
11-8 32
11-9 35
11-10 37
A 39
B 39
Inadequate controls over contracts Significant Deficiency
and Noncompliance
Inadequate maintenance and reconciliation of Material Weakness and
expenditure records Material Noncompliance
Inadequate controls over travel expenditures Significant Deficiency
and Noncompliance
Performance evaluations not completed Significant Deficiency
and Noncompliance
Nonpayment of revolving funds Significant Deficiency
And Noncompliance
PRIOR FINDINGS NOT REPEATED
Inadequate control over employee attendance records and
personnel functions
Improper use of appropriated funds
EXIT CONFERENCE
The findings and recommendations appearing in this report were discussed with
Department personnel at an exit conference on January 31, 2012. Attending were:
Department of Labor Office of the Auditor General
Joseph Costigan, Director Max Paller, Audit Manager
Joan Small, Fiscal Officer
Tammy Miner, Compliance Manager
Clifton Gunderson
JeffBonick, Partner
Chris Manderfield, Manager
Jen Meyer, Senior Associate
Responses to the recommendations were provided by Tammy L. Miner, Fiscal Officer
(effective 2/1/12) in a letter dated February 14, 2012.
4
f)
Clifton LarsonAllen
Cl iftonlarsonAIIen LLP
www.cliftonlarsonallen.com
INDEPENDENT ACCOUNTANTS' REPORT ON STATE COMPLIANCE,
ON INTERNAL CONTROL OVER COMPLIANCE, AND ON
SUPPLEMENTARY INFORMATION FOR STATE COMPLIANCE PURPOSES
Honorable William G. Holland
Auditor General
State of Illinois
Compliance
As Special Assistant Auditors for the Auditor General, we have examined the State of Illinois,
Department of Labor's compliance with the requirements listed below, as more fully described in
the Audit Guide for Financial Audits and Compliance Attestation Engagements of Illinois State
Agencies (Audit Guide) as adopted by the Auditor General, during the two years ended June 30,
2011. The management of the State of Illinois, Department of Labor is responsible for
compliance with these requirements. Our responsibility is to express an opinion on the State of
Illinois, Department of Labor's compliance based on our examination.
A. The State of Illinois, Department of Labor has obligated, expended, received, and used
public funds of the State in accordance with the purpose for which such funds have been
appropriated or otherwise authorized by law.
B. The State of Illinois, Department of Labor has obligated, expended, received, and used
public funds of the State in accordance with any limitations, restrictions, conditions or
mandatory directions imposed by law upon such obligation, expenditure, receipt or use.
C. The State of Illinois, Department of Labor has complied, in all material respects, with
applicable laws and regulations, including the State uniform accounting system, in its
financial and fiscal operations.
D. State revenues and receipts collected by the State of Illinois, Department of Labor are in
accordance with applicable laws and regulations and the accounting and recordkeeping of
such revenues and receipts is fair, accurate and in accordance with law.
E. Money or negotiable securities or similar assets handled by the State of Illinois,
Department of Labor on behalf of the State or held in trust by the State of Illinois,
Department of Labor have been properly and legally administered and the accounting and
recordkeeping relating thereto is proper, accurate, and in accordance with law.
We conducted our examination in accordance with attestation standards established by the
American Institute of Certified Public Accountants; the standards applicable to attestation
engagements contained in Government Auditing Standards issued by the Comptroller General of the
United States; the Illinois State Auditing Act (Act); and the Audit Guide as adopted by the Auditor
General pursuant to the Act; and, accordingly, included examining, on a test basis, evidence about
the State of Illinois, Department of Labor's compliance with those requirements listed in the first
paragraph of this report and performing such other procedures as we considered necessary in the
circumstances. We believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the State of Illinois, Department of Labor's
compliance with specified requirements.
5
As described in findings 11-1, 11-2, 11-3, 11-4, 11-5, and 11-7 in the accompanying schedule of
findings, the State of Illinois, Department of Labor did not comply with requirements regarding
applicable laws and regulations. Compliance with such requirements is necessary, in our opinion,
for the State of Illinois, Department of Labor to comply with the requirements listed in the first
paragraph of this report.
In our opinion, except for the noncompliance described in the preceding paragraph, the State of
Illinois, Department of Labor complied, in all material respects, with the compliance
requirements listed in the first paragraph of this report during the two years ended June 30, 2011.
However, the results of our procedures disclosed other instances of noncompliance with those
requirements, which are required to be reported in accordance with criteria established by the
Audit Guide, issued by the Illinois Office of the Auditor General and which are describyd in the
accompanying schedule offindings as 11-6, 11-8, 11-9, and 11-10.
Internal Control
Management of the State of Illinois, Department of Labor is responsible for establishing and
maintaining effective internal control over compliance with the requirements listed in the first
paragraph of this report. In planning and performing our examination, we considered the State
of Illinois, Department of Labor's internal control over compliance with the requirements listed
in the first paragraph of this report as a basis for designing our examination procedures for the
purpose of expressing our opinion on compliance and to test and report on internal control over
compliance in accordance with the Audit Guide, issued by the Illinois Office of the Auditor
General, but not for the purpose of expressing an opinion on the effectiveness of internal control
over compliance. Accordingly, we do not express an opinion on the effectiveness of the State of
Illinois, Department of Labor's internal control over compliance.
Our consideration of internal control over compliance was for the limited purpose described in
the preceding paragraph and was not designed to identify all deficiencies in internal control over
compliance that might be significant deficiencies or material weaknesses and, therefore, there
can be no assurance that all deficiencies, significant deficiencies, or material weaknesses have
been identified. However, as described in the accompanying schedule of findings, we identified
certain deficiencies in internal control over compliance that we consider to be material
weaknesses and other deficiencies that we considered to be significant deficiencies.
A deficiency in an entity's internal control over compliance exists when the design or operation
of a control over compliance does not allow management or employees, in the normal course of
performing their assigned functions, to prevent, or detect and correct, noncompliance with the
requirements listed in the first paragraph of this report on a timely basis. A material weakness in
internal control over compliance is a deficiency, or combination of deficiencies, in internal
control over compliance, such that there is a reasonable possibility that a material noncompliance
with a requirement listed in the first paragraph of this report will not be prevented, or detected
and corrected, on a timely basis. We consider the deficiencies in internal control over
compliance as described in the accompanying schedule of findings as items 11-1, 11-2, 11-3,
11-4, 11-5, and 11-7 to be material weaknesses.
A significant deficiency in internal control over compliance is a deficiency, or a combination of
deficiencies, in internal control over compliance that is less severe than a material weakness in
internal control over compliance, yet important enough to merit attention by those charged with
governance. We consider the deficiencies in internal control over compliance described in the
accompanying schedule of findings as items 11-6, 11-8, 11-9, and 11-10 to be significant
deficiencies.
6
As required by the Audit Guide, immaterial findings excluded from this report have been reported
in a separate letter to your office.
The State of Illinois, Department of Labor's responses to the findings identified in our
examination are described in the accompanying schedule of findings. We did not examine the
State of Illinois, Department of Labor's responses and, accordingly, we express no opinion on
the responses.
Supplementary Information for State Compliance Purposes
Our examination was conducted for the purpose of forming an opinion on compliance with the
requirements listed in the first paragraph of this report. The accompanying supplementary
information as listed in the table of contents as Supplementary Information for State Compliance
Purposes is presented for purposes of additional analysis. We have applied certain limited
procedures as prescribed by the Audit Guide as adopted by the Auditor General to the 2011 and
2010 Supplementary Information for State Compliance Purposes, except for infmmation on the
Schedule of Changes in State Property, Analysis of Accounts Receivable, and Service Efforts
and Accomplishments, on which we did not perform any procedures. However, we do not
express an opinion on the supplementary information.
We have not applied procedures to the 2009 Supplementary Information for State Compliance
Purposes, and accordingly, we do not express an opinion thereon.
This report is intended solely for the information and use of the Auditor General, the General
Assembly, the Legislative Audit Commission, the Governor, agency management, and is not
intended to be and should not be used by anyone other than these specified parties.
Peoria, Illinois
February 14, 2012
7
11-1. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Inadequate controls over revenues)
The Illinois Department of Labor (Department) did not exercise adequate controls over
revenues and related reporting. We noted the following weaknesses in the Department's
processing of receipts:
• Ten of 60 (17%) receipts tested, totaling $6,479, were deposited between 1.and 7 days
late (after 10 day extension period).
The State Officers and Employees Money Disposition Act (Act) (30 ILCS 230/2 (a))
generally requires each State agency to deposit into the State Treasury individual
receipts exceeding $10,000 in the same day received, an accumulation of receipts of
$10,000 or more within 24 hours, receipts valued between $500 and $10,000 within 48
hours, and cumulative receipts valued up to $500 on the next first or fifteenth day of the
month after receipt. The Department received extensions for the periods April23, 2009
through April 23, 2011 and April 23, 2011 through April 23, 2013 from the State
Treasurer. These extensions allow 10 days for the deposit of all agency receipts.
• Timeliness of deposit could not be determined for 4 of 60 (7%) receipts tested, totaling
$4,862, because the Department did not maintain documentation of the date received ..
The Act also requires each State agency to keep a detailed, itemized account of moneys
received, including the date of receipt.
• The Department did not retain copies of the Receipt Deposit Transmittal Forms, deposit
slips, and/or a Treasurer's Draft for 12 of 60 (20%) receipts tested, totaling $4,370.
• For 9 of 60 (15%) receipts tested, totaling $4,219, we noted Treasurer's Drafts were not
submitted to the Office of the Comptroller (Comptroller) within 30 days, which is
considered a reasonable time frame. The Treasurer's Drafts were submitted between 5
and 61 days late.
Statewide Accounting Management System (SAMS) (Procedure 25.10.30) requires
Treasurer's Drafts to be remitted to the Comptroller. Good internal controls require
deposits to be processed timely to increase the balance of funds available for
expenditure.
8
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• The Department's records for 38 of 60 (63%) receipts tested, totaling $33,796, were
inconsistent in terms of dates deposited on the Department's Check Receipts System
and the Department's files. There were differences of 1 to 13 days.
• For 3 of 60 (5%) receipts tested, totaling $3,412, the wrong receipt account code was
used to record the revenue.
• The Department's cash receipts records for 4 of 60 (7%) receipts tested, totaling $775,
did not agree to the payee and/or check number per copies of the checks.
• Upon review of the case file for 1 of 60 (2%) receipts tested, totaling $159, the
Department did not collect the entire amount due to the employees, and as such, did not
pay out the entire amount owed to these employees. One employee was overpaid by $4
and another employee was underpaid by $69, which represents a shortage of the total
paid by the employer of $65. The Department has since investigated this case and the
employer has since paid out the $69 owed to the underpaid employee.
• For 1 of 60 (2%) receipts tested, we noted that there was unnecessary information in the
Department's computer system related to that case. According to Department
personnel, this information was created to test the effectiveness of the system.
However, such information was not labeled as "test data" nor was it deleted from the
system once it was determined to be operating correctly.
The State Records Act (5 ILCS 160/9) requires the head of each State agency to
establish and maintain the records of the agency. The Fiscal Control and Internal
Auditing Act (30 ILCS 10/3001) states that all State agencies shall establish and
maintain a system, or systems, of internal fiscal and administrative controls, which shall
provide assurance that revenues, expenditures, and transfers of assets, resources, or
funds applicable to operations are properly recorded and accounted for to permit the
preparation of accounts and reliable financial and statistical reports and to maintain
accountability over the State's resources.
9
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• Four of 115 (3%) receipt reconciliations for the General Revenue Fund (Fund 001),
Special State Trust Fund (Fund 251), Child Labor Law Enforcement Fund (Fund 357),
Employee Classification Fund (Fund 446), and Department of Labor Federal Projects
Fund (Fund 724) contained errors when compared to the underlying supporting
documentation. Also, it appears that only a comparison is being prepared rather than a
true reconciliation for 55 of 55 (100%) receipt reconciliations for Fiscal Year 2010 for
all funds. Information from Department records is compared to records of the
Comptroller, however nothing is done to investigate differences and reconcile the
numbers reported by the Comptroller to Department Records. Therefore, there is an
unreconciled difference of$147,082 at the end ofFiscal Year 2010 among all funds.
In addition, we were unable to the test the timeliness of 115 of 115 (100%)
reconciliations for both fiscal years as the documentation provided by Department
personnel did not include the date the reconciliation was prepared.
Statewide Accounting Management System (SAMS) (Procedure 25.40.20) requires
each agency to reconcile its receipt records to Comptroller reports on a monthly basis
and to notify the Comptroller's Office of any unreconcilable differences noted so
necessary corrective action can be taken to locate the differences and correct the
accounting records. Good internal controls require reconciliations to be correct and
agree to Comptroller records, and to be done at least monthly so that differences are
investigated and corrected in a timely fashion.
The Department did not maintain sufficient documentation to support amounts reported
on their Agency Fee Imposition Reports prepared for Fiscal Year 2010 and Fiscal Year
2011. The Department misclassified 15 of 16 (94%) fees collected on the Fiscal Year
201 0 report. These errors had a material effect on the total amount of fees reported
resulting in a $55,438 difference between Comptroller's numbers and amounts listed on
the report. The Department misclassified 6 of 16 (3 8%) fees collected on the Fiscal Year
2011 report. These errors did not have a material effect on the total amount of fees
reported resulting in a $4,769 difference between Comptroller's numbers and amounts
listed on the report. In addition, the Fiscal Year 2011 report was submitted to the
Comptroller 19 days late. The State Comptroller Act (Act) (15 ILCS 405/16.2(a))
requires those agencies that impose fees to file the report with the Comptroller. SAMS
(Procedure 33 .16.20) states that the report must be filed with the Comptroller by August
1 of each year. In addition, good internal controls require the information submitted in
the Agency Fee Imposition Report to be accurate.
10
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
For 2 of 8 (25%) retumed checks tested, totaling $5,284, the Department does not appear
to be making adequate collection attempts. In one instance, the check was received in
November 2009 and was not sent to the Office of the Attomey General until November
2011. In the other instance, the check was received in March 2010, a letter was sent to
the company requesting repayment in June 2010, and as of November 1, 2011, the case
had not yet been sent to the Office of the Attomey General for collection. For 1 of 8
(13%) retumed checks tested, totaling $2,500, there were discrepancies between the
information on the check and the Department's records.
Statewide Accounting Management System (SAMS) (Procedure 26.40.1 0) requires
agencies to document collection efforts on past-due amounts owed to the State. Good
business practices state a proper intemal control structure should be established to help
ensure the collection of revenues.
Department personnel stated that the Department's goal is to perform all functions,
including the preparation, review and submission of reports in a timely manner.
However, as a result of staffing shortages, especially in the Fiscal Division, there are
times when other competing critical projects take precedence over this goal.
Delayed deposit of cash receipts reduces the amount of funds available for expenditure.
Inaccurate reconciliations could result in inaccurate statewide financial statement
reporting. Filing an inaccurate Agency Fee Imposition Report reduces the reliability of
statewide fee information. Failure to exercise adequate control over revenues is
noncompliance with the State Officers and Employees Money Disposition Act and could
result in inaccurate statewide financial statement reporting. Failure to retain
documentation to support reported amounts is noncompliance with the State Records Act.
(Finding Code No. 11-1, 09-1, 07-1, 05-3, 05-5)
11
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
RECOMMENDATION
We recommend the Department comply with the State Officers and Employees Money
Disposition Act by making timely deposits into the State Treasury and documenting the
date that receipts are received. Internal controls over receipts should also be enforced by
the Department to ensure collection of revenue and adequate documentation is
maintained and readily available for all transactions. Also, the monthly reconciliations
should be reviewed for accuracy and all differences investigated by the Department.
Further, the Department should maintain accurate documentation to support amounts
reported on their Agency Fee Imposition Reports and carefully review reports to ensure
all fees collected are reported and to ensure accuracy of the Agency Fee Imposition
Report before submission to the Comptroller. In addition, the Department should
document collection efforts on past-due amounts owed to the State and follow up with
past-due amounts more timely.
DEPARTMENT RESPONSE
The Department agrees with the recommendation and is developing a corrective action plan.
Most of the issues relate to limited staffing resources. Additional detail on some issues is as
follows:
Missing RDT forms: The data on misplaced Receipt Deposit Transmittal forms, deposit
slips or Treasurer's draft is correctly recorded in both the Comptroller's System and the
Department's internal system, however, replacement copies of these forms have been
requested in order to comply with the Department's record retention policy. These forms
were most likely misplaced or misfiled when the Department moved to a new location in
October/November 2010.
Different dates: The date in the Check Receipts System is the date that entries are made in
that system and is not required to be the date that checks are received or deposited. The
Department has been granted a 1 0-day extension to the deposit rule because of the lengthy
processing procedures needed for its receipts. Therefore, a batch of checks may be received
in the office on a particular day, entered in the Cash receipts system on another day and
deposited on another day, that is, 3 different dates for different stages of processing are
appropriate.
Receipt reconciliations: The unreconciled difference in Fiscal Year 2010 cash receipts is
$400 and is a timing issue. These are true reconciliations because they are based on the only
existing source data: the Department's Cash Receipts System, CMS's AIS, and the
Comptroller's SAMS system. Cash receipts and vendor expenditures recorded by the
Comptroller are direct data feeds from the Department's Cash Receipts system and CMS's
AIS system.
12
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Fee Imposition Reports: The documentation for the Fee Imposition Report is the report
from the Department's Cash Receipts System. The fees recorded by the Comptroller are
provided by the Department via the Receipt Deposit Transmittal (RDT) which is
automatically generated from the Department's Cash Receipts System. That is, the
Comptroller's data is a direct feed from the Department's system. However, there may
be some misinterpretation because there is not a one-to-one classification between the
codes in the Department's internal system and the Comptroller's Fee Imposition Report­some
internal codes have to be grouped for this particular report.
Returned checks: The Department utilizes the following procedure for collection of
returned checks:
1) Send a letter requesting payment with a money order or certified check
2) Follow-up via telephone, ifnecessary
3) Referral to the Attorney General after all other efforts fail.
The clerical error on the check being referenced has been corrected prior to the audit.
13
11-2. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
(Inadequate controls over accounts receivable records and reporting)
The Illinois Department of Labor (Department) did not exercise adequate controls over
accounts receivable records and reporting. We noted the following:
• The Department made a $251,000 adjustment on its June 30, 2011 accounts receivable
records. This adjustment was also reflected on the June 30, 2011 Quarterly Summary
of Accounts Receivable (C-97) report. According to Department personnel, the
adjustment was due to a change in methodology for recognizing accounts receivable.
Prior to this adjustment, it appears that receivables were booked at full value for any
amounts due the Department. However, per Department personnel, the majority of
these receivables are never fully collected; most are settled at a lesser value. The
$251,000 adjustment at year-end reduced the value of the receivables to their settlement
values. During our testing of detail accounts receivable records, we noted that the
settlement values of the receivables were erroneous, as these settlement values
contained money due to others rather than the amount due to the Department, and as
such, the final detailed accounts receivable records were reduced by an additional
$1,559,761. Although it appears that the new methodology is appropriate, it is apparent
that 24 of 24 (100%) C-97 reports prepared by the Department and submitted to the
Comptroller's Office did not accurately reflect Department accounts receivable
transactions. Therefore, there is a $1,560,000 difference between the June 30, 2011 C-
97 report and the Department's detail receivables listing. In addition, we noted that 13
of 24 (54%) C-97 reports showed no additions, collections, transfers in or out, or write­offs
of any receivables. It appears these numbers continued to be rolled forward :from
quarter to quarter.
Good business practices require sufficient and properly designed accounting records be
maintained to adequately control fiscal operations and provide reliable data for
necessary management reports. Good business practices also require that detailed
accounting records be accurate and thorough, and that a careful review of source
documentation and prepared reports is done before submission.
• The Department did not maintain adequate accounts receivable records to facilitate the
proper reporting of accounts receivable. Of the 40 accounts receivable balances
selected for testing, we found differences in 3 (8%) of these balances, for a total
difference of $2,73 9.
Statewide Accounting Management System (SAMS) (Procedure 26.20.1 0) requires
agencies to maintain detailed information related to each receivable in order to support
the recognition and tracking of receivables.
14
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• Six of 24 (25%) C-97 reports prepared by the Department were submitted to the
Comptroller's Office between 3 and 12 days late.
SAMS (Procedure 26.30.1 0) states the reports must be received by the Comptroller no
later than the last day of the month following the end of the quarter.
The Department reported gross receivables totaling $1,963 ,000 and $2,207,000 on its
June 30, 2011 and June 30, 2010 C-97s, respectively.
Department personnel stated that the Department's goal is to perform all functions,
including the preparation, review and submission of reports in a timely manner.
However, as a result of staffing shortages, especially in the Fiscal Division, there are
times when other competing critical projects take precedence over this goal.
Failure to maintain adequate documentation for accounts receivable increases the chances
of undetected errors occurring in reporting the amounts receivable and the likelihood of
accounts receivable not being adequately monitored for collection. In addition, failure to
monitor accounts receivable on a regular basis, identify delinquent accounts receivable,
and report accurate amounts can result in lost revenues for the State and inaccuracies in
statewide financial reporting. Failure to submit accounts receivable reports timely can
cause delays in statewide financial reporting. (Finding Code No. 11-2, 09-2, 07-2, 05-4)
RECOMMENDATION
We recommend the Department review C-97 reports before timely submission to the
Comptroller to ensure accuracy. Also, the Department should maintain detailed records
and supporting documentation of all billings and collections to support accounts
receivable balances reported.
DEPARTMENT RESPONSE
The Department will continue its in-depth review and analysis of the detail comprising the
accounts receivable balance.
15
11-3. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Property control weaknesses)
The illinois Department of Labor (Department) did not exercise adequate control over the
reporting of State property. The Department maintained two sets of property inventory
records during the period, including a computerized property inventory register and a
manually prepared quarterly transaction spreadsheet. The results of our testing indicated
that the valuation of the computerized property inventory register was insufficient. The
results of our testing indicated the two sets differed in content.
We noted 5 of 8 (63%) Quarterly Reports of State Property (C-15s) prepared by the
Department and submitted to the State Comptroller's Office did not accurately reflect
Department equipment transactions. We noted differences between the addition, transfer,
and ending balance amounts reported on the C-15s and the Department's quarterly
transaction spreadsheet as follows:
Amount Per
Amount Quarterly
Re2orted to Transaction
Quarter Asset Class Comotroller S£readsheet Difference
12/31/2009 Additions $97,525 $97,529 ($4)
3/31/2010 Additions $100,799 $2,848 $97,951
6/30/2010 Additions $2,953 $2,954 ($1)
12/31/2010 Transfers ($13 ,332) ($15,320) $1,988
6/30/201 1 Additions $1 ,868 $0 $1,868
6/30/2011 Transfers ($99,513) $0 ($99,513)
Total net difference- C-15s to Department records $2,289
In addition, we noted noncompliance with Statewide Accounting Management System
(SAMS) procedures. Specifically, we noted transfers of surplus property, totaling
$13,332, during Fiscal Year 2011 were inconectly classified on the C-15s as deletions.
This misclassification was conected by the Department on a subsequent C-15 report.
Also, 1 of8 (13%) C-15s was submitted 8 days late.
16
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
SAMS (Procedure 29.10.30) states the C-15 report should present the total cost of State
property, by category, reflected on the agency's records as of the reporting date. In
addition to SAMS procedures, good business practices require an agency to review all
reported information for accuracy before submission. SAMS (Procedure 29.10.10)
requires an agency to report all additions, deletions, and net transfers affecting each asset
class that occurred during the quarter being reported and to maintain property information
at a summary level, which includes a description of each asset, its location, its purchase
date, and its tag number. SAMS (Procedure 29.20.1 0) also states that the C-15 is to be
filed on a quarterly basis and should be submitted to the Office of the Comptroller no
later than the last day of the month following the last day of the quarter.
Further, the Department did not exercise adequate control over the recording of State
property. We noted the following:
• We were unable to trace $774 of property additions to the Department's property
inventory register.
• We noted the dollar amounts for $1,635 in property additions did not agree to the dollar
amounts per the Department's property inventory register.
• Forty-three items acquired during the period were recorded at the incorrect purchase
price, resulting in their values being overstated by a total of$15,639.
• Seven of 7 (100%) surplus items did not have sufficient documentation to determine
that they were sent to the Department of Central Management Services (CMS), and if
so, when they were sent.
• For 2 of 7 (29%) transferred out items tested, the Department did not provide the
purchase price and/or purchase date to the receiving agency.
• One item was transferred during Fiscal Year 2011 that had an original purchase price of
$14,842 in 2006. According to Department records and the March 31, 2011 C-15
report, the cost of the transferred item was $14,100. In addition, this item was still
listed on the Department's property inventory register as of October 2011.
• Eight of30 (27%) items tested, totaling $3,006, appeared on the Department's property
inventory register but could not be located within the Department.
• One of30 (3%) items tested, totaling $1,385, did not have a Department asset tag on it,
but was entered on the Department's property inventory register.
• The Department's property inventory register did not include a purchase date for 21 of
59 (36%) items tested, totaling $5,757.
17
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• Two of 59 (3%) items tested were visibly broken upon our inspection. These items had
a combined original cost of$1,407 on the Department's property inventory register.
• One of 30 (3%) items tested, totaling $1,685, was left off the property listing sent to
CMS.
• Six of 59 (1 0%) items tested were found in another location, other than the proper
location according to the Department's property inventory register.
• Two of 59 (3%) items tested had duplicate Department asset tag numbers on the
Department's prope1iy inventory register.
• The Department's property inventory register did not include a purchase price for 17 of
59 (29%) items tested.
SAMS (Procedure 29.10.10) requires an agency to report all additions, deletions, and net
transfers affecting each asset class that occurred during the quarter being report and to
maintain property information at a summary level, which includes a description of each
asset, its location, its purchase date, and its tag number. SAMS (Procedure 29.10.1 0) also
states that the objective of fixed asset reporting is to ensure that agencies are updating
property records to reflect the current balance of fixed assets and to enhance the accuracy
of information reported. In addition to SAMS procedures, good business practices
require an agency to review all reported information for accuracy before submission and
require proper internal controls to be established to ensure the accuracy and reliability of
accounting data. The State Records Act (5 ILCS 160/8) requires the head of each agency
to cause to be made and preserved records containing adequate and proper documentation
of the decisions and essential transactions of the agency designed to furnish information
to protect the legal and financial rights of the State and of persons directly affected by the
agency's activities. The Illinois Administrative Code (44 Ill. Adm. Code 5010.400) states
that agencies shall adjust property records within 30 days of acquisition, change or
deletion of equipment items. The Code (44 Ill. Adm. Code 5010.210) also requires
agencies to be responsible for marking each piece of State-owned equipment with a
unique six-digit identification number to be assigned by the agency holding the property.
The Code (44 Ill. Adm. Code 5010.500) requires agencies to report the theft of State
property immediately to the Property Control Division and the Department of State
Police. In addition, SAMS (Procedure 29.1 0.25) states that the objective of property
control is to minimize the burden placed on State government to replace lost, stolen, or
damaged property. SAMS (Procedure 29.10.25) also states that property control
procedures are generally designed to prevent or, at least, promptly detect loss or damage
to property.
18
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
The Department did not exercise adequate control over equipment leases. The
Department did not complete the applicable Accounting for Leases-Lessee Form (SC0-
560) for the two equipment lease agreements in place during the audit period. One of the
equipment leases was started in April 2005 for 36 months, however it was renewed for 3
additional years, and ended in April 2011. Total payments over the 6-year life of the
lease were approximately $50,000. The other equipment lease began in May 2011 and
covers 36 months. Payments on this lease totaled $7,737 during the year ended June 30,
2011.
SAMS (Procedure 27.20.60) requires the SC0-560 be completed on a transaction by
transaction basis as new lease agreements are initiated and sent to the Comptroller's
Office. The SC0-560 needs to be prepared if the fair market value of the new asset being
leased is greater than $5,000. The SC0-560 also needs to be prepared when there is an
early termination of an existing lease, or when changes are made to existing lease
provisions, including changes in the appropriation from which payments are made.
Department personnel stated that the errors were because many of the items being
referenced were not purchased, but were acquired from CMS salvage many years ago
when older inventory acquired from salvage did not always contain the level of detail
now required, including purchase date and purchase price. These items were other
agencies' "scrap" items that had no book value.
Failure to exercise adequate control over property and to maintain accurate property
control records increases the potential for fraud and possible loss or theft of State
property. In addition, inaccurate and untimely reporting on the C-15 reports could lead to
inaccuracies and delays in statewide financial information. The completion of the
SC0-560 allows the Comptroller's Office to determine if a leased asset should be
considered a capital lease asset. If the lease is a capital lease, the SC0-560 is used by the
Comptroller's Office to determine the cost of the asset to be recorded on the
Department's books, including the C-15.
19
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
In addition, during the prior examination period, it was noted the Department reported
equipment items on the C-15s late. During the current examination period, we noted the
Department reported equipment items on the C-15's timely. Also, during the prior
examination period, it was noted the Department did not timely record equipment
additions to the property inventory register. During the current examination period, it
was noted the Department timely recorded equipment additions to the property inventory
register. Lastly, during the prior examination period, it was noted the Department could
not provide documentation that it reported theft of equipment to the State Police. During
the current examination period, we inquired of Department personnel and were informed
that there was no theft of equipment during the two years ended June 30, 2011. (Finding
Code No. 11-3, 09-3, 07-3, 05-7, 03-6)
RECOMMENDATION
We recommend the Department strengthen controls over the recording and reporting of
State property by reviewing their inventory and recordkeeping practices to ensure
compliance with statutory and regulatory requirements. Also, the Department should
ensure all equipment is accurately and timely recorded on the Department's property
records and are properly valued. Further, the Department should thoroughly review all
reports prepared from internal records for accuracy before submission to the State
Comptroller and the Department of Central Management Services.
DEPARTMENT RESPONSE
The Department agrees with the recommendation. A corrective action plan is being
developed. Additional detail on some issues is as follows:
Differences in property additions: The difference is a $3 or $7 shipping and handling
charge per item that was not included in the pricing information available when the items
were added to inventory. There is often a time lag between the receipt of items and the
receipt of actual invoices. In order to get equipment into the hands of staff, list prices are
entered in the inventory database prior to receipt of actual invoices. The database is being
adjusted for these minor differences.
Forty-three items at the incorrect purchase price: This amount of$15,639 includes items on
three vouchers, numbers 1195, 1196 and 1198. These vouchers were in the inventory
database because they are the cost of the cubicles (staff workstations) that are
interconnected. The program has a comments field that contains this explanatory
information.
20
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Surplus items: The electronic upload to CMS's salvage system is mandatory and does not
leave an automatic paper trail. The Department will need to develop some additional
procedures.
Missing purchase price and/or date: These items were not purchased, but acquired from
CMS salvage and are part of the data set that was imported from the old mainframe
database. Previously, older inventory acquired from salvage did not contain the level of
detail currently being required, including purchase price and purchase date since most of
it had no book value and was "scrap" from other agencies.
Missing Tag: The item was tagged. It is Tag# 567 that was transferred to another
agency on 03/25/2011.
Items that could not be located: The Department is aware of 4 items that could not be
located. A further search will be conducted and all missing items will be reported.
Missing asset tag for $1,3 85 item: This is the conference table and it does have a tag #.
The number is 688.
Broken items: The $1,407 is the original purchase price of these items which are many
years old and have no book value. One item is a typewriter that is many years old and
well past its useful life. It can easily be salvaged. The other is a Brother desktop printer
that is slightly broken but still works.
Items moved from one location to another: "Location" in this context means "a room or
office in the same building." Items are allowed to be moved between work areas in the
same building for use by Department personnel. A revised form to track items that have
been moved has recently been implemented.
21
11-4. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Inadequate controls over Special State Trust Fund)
The Illinois Department of Labor (Department) did not exercise adequate controls over
its Special State Trust Fund (Fund 251). We noted the following control weaknesses:
• For 1 of the 40 (3%) expenditures selected for testing in Fund 251, the Department's
records for amounts due to a claimant did not agree to the underlying supporting
documentation. The underlying support for this case shows that the claimant should be
paid $6,600; however, the Department's case file showed the claimant is due $6,768.
• The Department did not maintain a ledger of claimants and corresponding dollar
amounts comprising the balance held in Fund 251. The State Comptroller's Office
records showed balances of $1,524,265 and $1,513,315 held in Fund 251 as of June 30,
2010 and June 30, 2011, respectively.
The Department operates the Special State Trust Fund as an agency fund in the State
Treasury. The purpose of this fund is to hold wage claims collected from employers by
the Department ·on behalf of Illinois workers (claimants) and hold those monies until the
claimants can be located and properly paid. Good business practices require sufficient
and properly designed accounting records to be maintained to adequately control fiscal
operations. The Illinois State Records Act (Act) (5 ILCS 160/8-9) requires agency heads
to preserve records and essential transactions of the agency designed to furnish
information to protect the legal and financial rights of the State and to establish and
maintain an active, continuing program for the economical and efficient management of
the records.
According to Department officials, the Department lacks the resources to maintain such a
ledger.
Failure to exercise adequate control over the Special State Trust Fund is noncompliance
with the Act and could result in inaccurate statewide financial statement reporting.
(Finding Code No. 11-4, 09-4, 07-4).
22
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
RECOMMENDATION
We recommend the Department maintain detailed records for all Special State Trust Fund
transactions. We also recommend that case files and proposed claimant expenditures are
thoroughly reviewed for accuracy prior to authorization.
DEPARTMENT RESPONSE
The Department is seeking funding to upgrade its computerized systems and will explore
the feasibility of having an electronic accounts receivable subsidiary ledger.
23
11-5. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Inadequate controls over voucher processing)
The Illinois Department of Labor (Department) did not exercise adequate controls over
voucher processing. We noted the following:
• Fifty-three of 234 (23%) vouchers tested, totaling $28,595, were approved for payment
from 2 to 193 days late. Six of234 (3%) vouchers tested, totaling $3,127, contained no
signature and/or date from the agency head. Nine of234 (4%) vouchers tested, totaling
$102,048, were not properly approved.
The Illinois Administrative Code (74 Ill. Adm. Code Section 900.70) requires an
agency to review a bill and either deny the bill in whole or part, ask for more
information necessary to review the bill, or approve the bill in whole or in part, within
30 days after physical receipt of bill.
• The Department could not locate 2 of 234 (1 %) vouchers, totaling $468, selected for
testing.
The Illinois State Records Act (5 ILCS 160/9) requires the head of each agency
establish and maintain an active, continuing program for the economical and efficient
management ofthe records of the agency.
• Three of234 (1 %) vouchers tested, totaling $1,907, were missing information and were
therefore not properly completed, or the information on the voucher did not agree to
Department records. One of 234 (1 %) vouchers tested, totaling $320, had expenses that
were charged to the wrong fiscal year.
Statewide Accounting Management System (SAMS) (Procedure 17.20.20) requires
that each State agency enter specific information on the top-third of the voucher.
Good business practices require that this information be accurate and agree to the
underlying accounting system. In addition, the voucher should be charged against the
correct fiscal year so that expenditures do not exceed the appropriated amounts.
• Nine of 234 (4%) vouchers tested, totaling $5,946, were not charged to the correct
SAMS detail object code.
SAMS (Procedure 17.20.20) requires that each State agency enter the correct SAMS
detail object code for which the expenditure should be expensed.
24
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• Twenty-nine of234 (12%) vouchers tested, totaling $18,365, were not signed and dated
by the receiving officer.
SAMS (Procedure 17.20.20) states each invoice-voucher, upon receipt of goods or
services must be signed by the receiving officer verifying goods or services meet the
stated specifications.
• Forty-one of234 (18%) vouchers tested, totaling $21,449, did not have required interest
paid to the vendor in Fiscal Year 2010. Forty-four of 234 (19%) vouchers tested,
totaling $20,341, did not have required interest paid to the vendor for Fiscal Year 2011,
as of October 31, 2011.
The State Prompt Payment Act generally provides for a late payment interest penalty to
be paid to a vendor under certain conditions. Any bill, except a bill submitted under
Article V of the Illinois Public Aid Code, approved for payment under this Section must
be paid or the payment issued to the payee within 60 days of receipt of a proper bill or
invoice. If payment is not issued to the payee within this 60 days period, an interest
penalty of 1.0% of any amount approved and unpaid shall be added for each month or
fraction thereof after the end of this 60 days period, until final payment is made.
Through June 30, 2010, P.A. 96-555 required that all interest for all amounts must be
paid. Effective July 1, 2010, P.A. 96-959 requires interest less than $50 not be paid but
shall be accrued until all interest due the vendor for all similar warrants exceeds $50, at
which time the accrued interest shall be payable and interest will begin accruing again,
except that interest accrued as of the end of the fiscal year that does not exceed $50 shall
be payable at that time. Through Fiscal Year 2011, interest shall begin accruing on the
61 st day after receipt of a proper bill and shall continue to accrue until the bill is paid by
the Comptroller's Office. Amounts due for interest should be measured and paid in
accordance with the law that was in effect on the day the State of Illinois issued
payment.
• Three of234 (1 %) vouchers tested, totaling $1,448, did not properly trace to supporting
documentation.
SAMS (Procedure 17.1 0.20) requires that each State agency maintain all supporting
documentation necessary to substantiate their expenditures.
• One of 234 (1 %) invoices tested, totaling $1,193, was paid twice by two separate
vouchers.
Good business practices require that invoices are only paid once.
25
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Department personnel stated that the Department's goal is to perform all functions in a
timely and effective manner. However, as a result of staffing shortages, especially in the
Fiscal Division, there are times when other competing critical projects take precedence
over this goal.
Failure to approve vouchers timely could subject the State to unnecessary interest
charges. The lack of adequate approval, including a signature by the Agency head and a
receiving officer, reduces the overall control over expenditures and may lead to
inappropriate expenditures. Failure to maintain vouchers results in noncompliance with
the Illinois State Records Act. The failure to provide accurate information could result in
inaccurate accounting information. The failure to use the correct SAMS account code and
SAMS detail object code could cause inaccurate reporting. Failure to pay the required
interest on vouchers results in noncompliance with the State Prompt Payment Act. The
failure to maintain adequate supporting documentation for expenditures could result in
incorrect accounting information and could cause unnecessary expenditures. Paying an
invoice twice results in unnecessary expenditures. (Finding Code No. 11-5, 09-11, 07-
12 05-9 03-2 01-1 99-1)
' ' ' '
RECOMMENDATION
We recommend the Department implement procedures to ensure all vouchers are
approved timely in accordance with the Illinois Administrative Code and develop and
implement procedures to identify all vouchers not paid within 60 days to ensure the
proper amount of interest is paid in accordance with the State Prompt Payment Act.
Also, the Department should comply with the Illinois State Records Act and ensure it
maintains an adequate system of recordkeeping. Further, the Department should comply
with SAMS procedures by having a receiving officer sign each voucher to indicate goods
were received according to stated specifications. In addition, the Department should keep
adequate supporting documentation for all vouchers and ensure the correct SAMS
information and accurate general information is reported on all vouchers. Also, the
Department should recover the duplicate payment made of $1,193.
DEPARTMENT RESPONSE
The Department agrees with this recommendation. The Department will continue to seek
additional resources for the Fiscal Division so that the voucher review and approval
processes can be performed by separate individuals. A procedure that requires written
approval from the receiving officer has been implemented. Interest payments are automatically
calculated by CMS 's AIS system. The Department routinely reviews interest due
payment vouchers and approves vouchers that meet the $50 threshold.
26
11-6. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
(Inadequate controls over contracts)
The Illinois Department of Labor (Department) did not exercise adequate controls over
the contractual agreements. We noted the following:
• The Department did not file a Contract Obligation Document (COD) with the Office
of the Comptroller after issuing a request to lease printing equipment through the
Department of Central Management Services (CMS) Master Contract. The contract
set forth a maximum of $36,693 to be paid to the vendor for the period May 1, 2011
through April30, 2014.
Statewide Accounting Management System (SAMS) (Procedure 15.10.40), states that
agencies are required to file Contract Obligation Documents (COD) with the
Comptroller within 15 days of execution of a contract, purchase order, grant, lease, or
modification thereto. "Execution" occurs when all required elements of an agreement
have been written and formally approved (in writing) by all parties as required by law
for filing with the Comptroller. Good business practices require the Department to
adequately and timely file a COD with the Comptroller.
• The Department held a contract with a vendor between April2005 and April2011, with
total payments of approximately $50,000 that did not meet the proper procurement
procedures issued by the State. The equipment leasing was procured through the
Department instead of using a Statewide CMS Master Contract and was not in
compliance with the laws, rules and regulations regarding contract content. The contract
and COD were never filed with the Office of the Comptroller or published within the
Illinois Procurement Bulletin. The contract ended in April2011.
In accordance with the Illinois Procurement Code (30 ILCS 500/20-80(b)), whenever a
contract liability exceeding $10,000 is incurred by any State agency, a copy of the
contract, purchase order, grant, or lease shall be filed with the Comptroller within 15
days thereafter. SAMS (Procedure 15.20.20) outlines specific laws, rules, and
regulations that must be included in a contract, such as an appropriation contingency
clause, drug free certification, and domestic products certification, which were not
included in the Department's contract.
27
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Department personnel stated that the Department's goal is to perform all functions in a
timely manner. However, current staffing shortages makes this an on-going challenge.
Filing a COD with the Office of the Comptroller allows the money to be set aside for the
appropriate vendor. Not filing such document results in outstanding contracts that the
Comptroller is not aware of. Failure to obtain proper contractual agreements could lead to
the inefficient use of State resources and is not in compliance with the Illinois Procurement
Code. (Finding Code No. 11-6)
RECOMMENDATION
We recommend the Department ensure that CODs are filed timely with the Office of the
Comptroller. In addition, the Department should abide by the rules set forth in SAMS and
the Illinois Procurement Code as it relates to procuring contracts.
DEPARTMENT RESPONSE
The Department agrees with this recommendation. A Contract Obligation Document has
been filed. However, because this is based on an existing CMS master contract, no late
execution waiver is required. The Department acted appropriately in Fiscal Year 2011 by
terminating the contract that was executed in 2005.
28
11-7. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
(Inadequate maintenance and reconciliation of expenditure records)
The Illinois Department of Labor (Department) did not perform adequate and/or accurate
expenditure and fund reconciliations during the examination period. In addition, the
Department did not maintain accurate expenditure records. The Department operated 5
funds during the examination period: the General Revenue Fund (Fund 001), Special State
Trust Fund (Fund 251 ), Child Labor Law Enforcement Fund •(Fund 357), Employee
Classification Fund (Fund 446), and the Department of Labor Federal Projects Fund (Fund
724). There were no expenditures in Fiscal Year 2010 or 2011 in Fund 446; therefore, no
expenditure or fund reconciliations were necessary. We noted the following regarding the
Department's reconciliations:
• None of the monthly expenditure reconciliations performed for any of the funds were
signed off and dated by the preparer or reviewer of the reconciliations. As a result, we
could not determine who prepared 107 of 107 (100%) reconciliations, or how timely the
reconciliations were performed.
• We noted errors in 36 of 56 (64%) expenditure reconciliations performed for Fiscal Year
2011. For these reconciliations, the supporting documentation provided by the
Department did not agree to that which was used on the reconciliation.
• Although the Department compared agency records to Comptroller reports, it does not
appear that differences on the reconciliations were investigated in order to determine the
cause and/or necessary course of action. The Department's expenditure records were
incomplete and inaccurate. As such, we noted the following unreconciled differences at
year-end for each of the Fiscal Years:
Fiscal Year 2010 Fiscal Year 2011
Fund 001 $23,585 ($17,302)
Fund 251 $40,388 $34,644
Fund 357 ($5,943) $9,417
Fund 724 ($36,897) ($36,903)
Total Unreconciled Difference $21,133 ($10,144)
29
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
• In addition, the Department was unable to locate documentation to support the "Ending
Balance of Available Cash per IDOL" amounts on 72 of72 (100%) fund reconciliations
for Fund 251, Fund 357, and Fund 724 for the audit period. None of these fund
reconciliations were signed off and dated by the preparer or reviewer of the
reconciliation. As a result, we could not determine who prepared 72 of 72 (100%)
reconciliations, or how timely the reconciliations were performed.
Statewide Accounting Management System (SAMS) (Procedure 11.40.20) requires each
agency to reconcile appropriation expenditures monthly and notify the Comptroller of
irreconcilable differences. The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001)
requires all State agencies to establish and maintain a system, or systems, of internal fiscal
and administrative controls. Good internal controls require sufficient and properly designed
accounting records be maintained to adequately control fiscal operations and provide
reliable data for necessary management reports. The Illinois State Records Act (5 ILCS
160/9) requires the head of each agency establish and maintain an active, continuing
program for the economical and efficient management of the records of the agency. Good
internal controls require agencies administering funds to reconcile all fund activity,
including expenditures, revenues, and fund balance, to protect the integrity of the fund and
those owed monies currently being held in the fund.
Department personnel stated that the Department's goal is to perform all functions in a
timely and effective manner. However, as a result of staffing shortages, especially in the
Fiscal Division, there are times when other competing critical projects take precedence
over this goal.
Failure to maintain accurate and complete expenditure records could result in expenditures
made in excess of available appropriations. Failure to perform adequate monthly
reconciliations of expenditures and fund balances between Department records and
Comptroller records that actually reconcile and identify differences, impairs the
Department's and the Comptroller's ability to identify possible errors and take corrective
action to ensure accurate accounting for Department expenditures. (Finding Code No. 11-7,
09-5, 07-6)
30
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
RECOMMENDATION
We recommend the Department implement procedures to ensure the completeness and
accuracy of expenditure records maintained. The Department should also perform and
document the results of all monthly reconciliations of Department expenditure and fund
balance records to Comptroller records and promptly notify the Comptroller of any
irreconcilable differences noted.
DEPARTMENT RESPONSE
The differences between the Comptroller's SAMS and CMS's AIS - the Department's
internal expenditures system, are timing differences. The Comptroller's data for
expenditures is a direct feed from the CMS' s AIS and Central Time Keeping and Payroll
System, that is, the Department's records.
31
11-8. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Inadequate controls over travel expenditures)
The Illinois Department of Labor (Department) did not exercise adequate internal
controls over its travel expenditures. We noted the following:
• Eight of 43 (19%) travel vouchers tested totaling $2,209, contained excess
reimbursements of $475 for expenses incurred between the employees' homes and
headquarters.
The illinois Administrative Code (Code) (80 ill. Adm. Code Section 3000.220) states
expenses incurred by employees in commuting from their residence to their headquarters
are not reimbursable.
• Two of 40 (5%) travel vouchers tested totaling $694 had an incorrect charge for per
diem. In one instance an employee charged $21 for per diem for a four hour trip. The
other instance included a trip with a total per diem charge of $36.50 when it should have
been only $28.
The Code (80 Ill. Adm. Code Section 3000.500) states that per diem will be paid to
travelers who have overnight lodging or 18 or more continuous hours. The Code (80 Ill.
Adm. Code Section 3000, Appendix A) also states per diem for each quarter is $7.00 or
$28 per day.
• One of 40 (3%) travel vouchers tested totaling $54 was submitted 52 days late.
The Department of Labor Policy Manual states that vouchers must be submitted within
60 days after the expenses were paid or incurred. If submitted later the Department must
process the payment on payroll with taxes deducted. If a travel voucher does not meet
the 60 day requirement the employee can submit an exception letter along with their
travel voucher. The Department did not follow this procedure and reimbursed the
employee in full.
• One of 40 (3%) travel vouchers tested totaling $305 did not have the associated
certification that the employee was duly licensed and carried the minimum amount of
automobile liability insurance required in the employee's file.
Good business practices require that this certification be kept in a separate file.
32
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
• Four of 40 (10%) travel vouchers tested totaling $1,509, contained discrepancies in the
reported headquarters for the traveler between the travel voucher and the Travel
Headquarters (TA-2) reports. One of 40 (3%) travel vouchers tested totaling $309,
contained a traveler who was not reported on the TA-2 report in the year the expense
was incurred. Two of 4 (50%) TA-2 reports were filed with the Legislative Audit
Commission 4 to 13 days late.
The State Finance Act (30 ILCS 105/12-3) requires each State agency to file reports for
all of its officers and employees for whom official headquarters have been designated at
any location other than that at which their official duties require them to spend the
largest part of their working time. The reports are required to be filed with the
Legislative Audit Commission by January 15 and July 15 of each year for the preceding
six month periods ended December 31 and June 30. The report shall list, for each
officer or employee, the place designated as his or her official headquarters and the
reason for that designation. Agencies with no officers or employees in this status shall
file a negative report. In addition, good business practices require a careful review of
source documentation and prepared reports before submission.
Department personnel stated that the Department's goal is to perform all functions in a
timely manner. However, current staffing shortages makes this an on-going challenge.
The Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires all State
agencies to establish and maintain a system, or systems, of internal fiscal and
administrative controls to provide assurance funds and resources are safeguarded against
waste, loss, unauthorized use, and misappropriation. Good internal controls require a
thorough review of all travel vouchers to ensure accurate and timely information and to
prevent improper expenses from being reimbursed. Failure to file reports in a timely
manner reduces effective government oversight and is noncompliant with a statutory
mandate. Improper designation of headquarters could allow the employee to
reimbursement for commuting costs and other travel expenses not otherwise allowed.
In addition, during the prior examination period, it was noted the Department paid
amounts in excess of the allowable lodging rate. During the current examination period,
we did not note any amounts paid in excess of the allowable lodging rate. (Finding
Code No. 11-8, 09-6, 07-11)
33
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
RECOMMENDATION
We recommend the Department carefully and timely review travel vouchers to ensure
accuracy of reported information and to ensure accuracy and reasonableness of travel
claims prior to payment. In addition, we recommend the Department periodically
remind all employees of the allowable per diem rates set forth in the travel regulations,
as well as the required amount of automobile liability insurance required. Lastly, we
recommend the Department obtain reimbursement from those employees overpaid.
DEPARTMENT RESPONSE
The TA-2 report has been updated since the beginning of Fiscal Year 2011. The
employees in question are authorized to work from home and therefore did charge travel
appropriately. The Department will obtain reimbursement for any overpayment of
travel.
34
11-9. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Performance evaluations not completed)
The Illinois Department of Labor (Department) did not conduct employee performance
evaluations timely. We tested 40 employee files, some of which required multiple (2 to
4) evaluations during the two year period. We noted the following:
• The Department did not perform annual employee performance evaluations m
accordance with the Department's Policy Manual for 23 (58%) employees tested.
• Of the 40 employee files tested, 10 employees were required to have an additional
evaluation completed at the 3 Yz month point of a 4 month probationary period due to an
employee promotion. The Department did not perform such evaluations for 5 (50%) of
these employees.
• Of the 40 employee files tested, 6 employees were newly hired during the audit period
and were therefore required to have an additional evaluation completed 6 months after
the effective date of their hire. The Department did not perform such evaluations for 5
(83%) of these employees.
The Illinois Department of Labor Policy Manual states that certified employees are to be
evaluated at least once a year, employees serving a four-month probationary period shall
be evaluated 3Yz months after the probationary period begins, and employees serving a
six-month probationary period shall be evaluated at the end of their third month and
again at the end of 5Yz months of employment, at which time a determination is made as
to whether the employee should be certified in the position or be discharged. The
Illinois Administration Code (80 Ill. Adm. Code 302.270) states performance records
shall include an evaluation of employee performance, and that for every certified
employee, each agency shall prepare such an evaluation not less often than annually. In
addition, good business practices require agencies to ensure accurate and timely
information flow to facilitate operational planning and guide employee actions.
Department personnel stated that some evaluations were not completed due to
management turnover. Other evaluations were not completed due to the multitude of
responsibilities and competing demands on the Department's supervisory and
managerial staff.
35
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Perfonnance evaluations are a systematic and uniform approach used for the development of
employees and communication of performance expectations to employees. Performance
evaluations should serve as a foundation for salary adjustments, promotion, demotion,
discharge, layoff, recall, and reinstatement decisions.
In addition, during the prior examination period, it was noted the Department did not
timely communicate performance evaluations to employees. In the current examination
period, we did not note any untimely communication of performance evaluations.
(Finding Code No. 11-9,09-7, 07-13, 05-10)
RECOMMENDATION
We recommend the Department implement internal controls to ensure required employee
performance evaluations are completed in a timely manner and in accordance with the
Department's policy.
DEPARTMENT RESPONSE
Evaluations were not completed due to management turnover. Other evaluations were not
completed due to the multitude of responsibilities and competing demands on the
Department's supervisory and managerial staff. However, evaluations are not the
foundation for salary adjustments since 93 of our current 98 employees are in bargaining
units and contract language is followed for salary adjustments, promotion, demotion,
discharge, and layoff, recall, and reinstatement decisions. The 5 merit comp staff do not
receive salary adjustments based on evaluations- these adjustments are rare and when they
do occur, are based on a statewide budget-related formula.
36
11-10. FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
(Nonpayment of revolving funds)
The Department of Labor (Department) failed to pay $333,087 to the Department of Central
Management Services (CMS) as of June 30, 2011.
The Department purchases various goods and services from CMS and is billed for these
through revolving funds, which are accounted for as Internal Service Funds. In our
testing, we found the Department still owed CMS revolving funds the following amounts
as of June 30, 2011:
Communications Revolving Fund
Statistical Services Revolving Fund
Total
$144,642
$188,445
$333.087
The above amounts are for goods and services purchased from CMS from Fiscal Year
2009 through Fiscal Year 2010. As of November 30, 2011, the Department has paid
$139,139 to the Statistical Services Revolving Fund.
CMS Administrative Rules (74 Ill. Adm. Code 1000.50) requires user agencies to process
payments within 30 days after physical receipt of Internal Service Funds bills and to make
reasonable efforts to review, approve, and pay all Internal Service Fund bills in the fiscal
year in which the liability was incurred. User agencies are not to leave Internal Service
Fund bills unpaid in order to circumvent fiscal year budgetary controls. In addition, the
Fiscal Control and Internal Auditing Act (30 ILCS 10/3001) requires all State agencies to
establish and maintain a system, or systems of internal fiscal and administrative controls
which shall provide assurance that revenues, expenditures, and transfers of assets, resources,
or funds applicable to operations are properly recorded and accounted for to permit the
preparation of reliable financial and statistical reports and to maintain accountability over
the State's resources.
Department personnel stated that in Fiscal Year 2011, the Department paid all CMS Fiscal
Year 2011 invoices and the amount outstanding is from previous years.
37
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30, 2011
Failure to pay for the services provided to it by CMS represents noncompliance with the
Illinois Administrative Code, obligates the State without authorization, and prevents the
Department from abiding by the appropriation authority given to it by the General
Assembly. (Finding Code No. 11-10, 09-9)
RECOMMENDATION
We recommend the Department work with the Governor's Office of Management and
Budget to determine a method by which to become current with its balance due from
Fiscal Years 2009 and 201 0 to CMS and initiate reductions in other areas to ensure
sufficient funds to pay for the services provided by CMS.
DEPARTMENT RESPONSE
In Fiscal Year 2011, the Department paid all CMS Fiscal Year 2011 invoices; the amount
outstanding is from previous years. The "Catch UP Billing" Statute, 30ILCS 105/25/(i)(3),
permits agencies to pay prior year CMS bills in later years. The Department will continue to
use this authorization and seek additional appropriation to pay CMS outstanding invoices.
38
A.
B.
FINDING
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF FINDINGS
For the Two Years Ended June 30,2011
Prior Findings Not Repeated
(Inadequate control over employee attendance records and personnel
functions)
During the prior examination, the Illinois Department of Labor (Department) did not
exercise adequate controls over employee attendance records and personnel functions.
During the current examination, our testing results indicate the Department did exercise
adequate controls over employee attendance records and personnel functions. (Finding
Code No. 09-8)
FINDING (Improper use of appropriated funds)
During the prior examination, the Illinois Department of Labor (Department) improperly
used funds appropriated by the General Assembly.
During the current examination, according to our test results, the Department properly used
funds appropriated by the General Assembly. (Finding Code No. 09-1 0)
39
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPLIANCE EXAMINATION
For the Two Years Ended June 30, 2011
SUPPLEMENTARY INFORMATION FOR STATE COMPLIANCE PURPOSES
SUMMARY
Supplementary Information for State Compliance Purposes presented in this section of
the report includes the following:
• Fiscal Schedules and Analysis:
Schedule of Expenditures of Federal Awards
Notes to the Schedule of Expenditures ofFederal Awards
Schedule of Appropriations, Expenditures and Lapsed Balances
Comparative Schedule of Net Appropriations, Expenditures and Lapsed Balances
Schedule of Changes in State Property (Not Examined)
Comparative Schedule of Cash Receipts (Not Examined)
Reconciliation Schedule of Cash Receipts to Deposits Remitted to the State
Comptroller (Not Examined)
Analysis of Significant Variations in Expenditures
Analysis of Significant Variations in Receipts
Analysis of Significant Lapse Period Spending
Analysis of Accounts Receivable (Not Examined)
• Analysis of Operations:
Agency Functions and Planning Program
Average Number of Employees
Service Efforts and Accomplishments (Not Examined)
The accountants' report that covers the Supplementary Information for State Compliance
Purposes presented in the Compliance Report Section states the auditors have applied certain
limited procedures as prescribed by the Audit Guide as adopted by the Auditor General, except
for information on Service Efforts and Accomplishments, Schedule of Changes in State Property,
Comparative Schedule of Cash Receipts, Reconciliation Schedule of Cash Receipts to Deposits
Remitted to the State Comptroller, and Analysis of Accounts Receivable, on which they did not
perfonn any procedures. However, the accountants do not express an opinion on the
supplementary information.
40
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Two Years Ended June 30,2011
Federal Grantor/
Pass-through Grantor/
Program or Cluster Title
U.S. Department of Labor
Federal
CFDA
Number
Occupational Safety and Health Administration
Occupational Safety and Health State Program 17.503
TOTAL EXPENDITURES OF FEDERAL AWARDS
Federal Expenditures
$1,146,765 $615,183
$1.146.765 $615.183
See accompanying notes to the Schedule of Expenditures of Federal Awards.
41
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Two Years Ended June 30, 2011
NOTE 1- Significant Accounting Policies
A. Basis of Presentation
The Schedule of Expenditures of Federal Awards presents the activity of all federal
award programs of the State of Illinois, Department of Labor (Department), for the
years ended June 30, 2011 and June 30, 2010.
B. Basis of Accounting
The Schedule of Expenditures of Federal Awards is prepared on the cash basis of
accounting.
NOTE 2- Description of Grant Programs
The following is a brief description of the grant program included in the Schedule of
Expenditures ofFederal Awards:
Occupational Safety and Health State Program- CFDA #17.503
The Department received a grant from the Occupational Safety and Health
Administration to focus on improving workplace safety and health for all workers and to
promote a safe and healthy culture through compliance assistance, cooperative programs
and strong leadership.
NOTE 3- Pass-Through and Subrecipient Awards
The Department received all of its Federal assistance from the U.S. Department of Labor,
passed through the Occupational Safety and Health Administration, and did not provide
any awards to subrecipients.
NOTE 4- Noncash Awards
The Department did not receive any noncash awards.
42
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Appropriations for Fiscal Year 2011
P.A. 96-0956
APPROPRIATED FUNDS
General Revenue Fund - 001
Lump Sum Appropriation
Personal Services
State contributions to
Social Security
Contractual Services
Travel
Commodities
Printing
Equipment
Electronic Data Processing
Telecommunications
Other Purposes
Total General Revenue Fund
Fourteen Months Ended August 31, 2011
$
$
Appropriations
(Net After
Transfers)
5,406,800
5,406,800
$
$
Expenditures
Through
6/30111
4,272,736
318,917
33,293
89,052
10,898
3,017
2,243
6,325
4,736,481
Note: Appropriations, expenditures, and lapsed balances were obtained directly from the records of the State Comptroller,
which have been reconciled to agency records, except as noted in Finding 11-7.
43
$
$
Lapse Period
Expenditures
7/01- 8/31111
67,368
5,154
178,059
24,400
5,541
794
320
2,644
109,221
1,355
394,856
$
$
Total
Expenditures
4,340,104
324,071
211,352
113,452
16,439
3,811
2,563
8,969
109,221
1,355
5,131,337
-
$
Balances
Lapsed
275,463
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Appropriations for Fiscal Year 2011
Fourteen Months Ended August 31, 2011
Appropriations Expenditures
P.A. 96-0956 (Net After Through
APPROPRIATED FUNDS Transfers) 6/30/ll
Child Labor Enforcement Trust Fund - 357
Administration of Child Labor Law $ 500,000 $ 402,623
Total Child Labor Enforcement Trust Fund $ 500,000 $ 402,623
Department of Labor Federal Trust Fund - 724
Administration of Federal Project $ 1,500,000 $ 1,137,585
Total Department of Labor Federal Trust Fund $ 1,500,000 $ 1,137,585
Total- All Appropriated Funds $ 7,406,800 $ 6,276,689
NON-APPROPRIATED FUNDS
Department of Labor Special State Trust Fund - 251
Grants and A wards $ 1,344,135
Total All Non-Appropriated Funds $ 1,344,135
GRAND TOTAL ALL FUNDS $ 7,620,824
Note: Appropriations, expenditures, and lapsed balances were obtained directly from the records of the State Comptroller,
which have been reconciled to agency records, except as noted in Finding 11-7.
44
Lapse Period
Expenditures
7/01 - 8/31111
$ 18,352
$ 18,352
9,180
$ 9,180
$ 422,388
7,057
$ 7,057
$ 429,445
Total Balances
Expenditures Lapsed
$ 420,975 $ 79,025
$ 420,975 $ 79,025
$ 1,146,765 $ 353,235 -
$ 1,146,765 $ 353,235 -
$ 6,699,077 $ 707,723
$ 1,35 1,192
$ 1,35 1,192
-
-
$ 8,050,269
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Appropriations for Fiscal Year 2010
Fourteen Months Ended August 31,2010
Appropriations Expenditures Lapse Period
P.A. 96-0042 (Net After Through Expenditures Total Balances
APPROPRIATED FUNDS Transfers) 6/30/10 7/01- 8/31110 Expenditures Lapsed
General Revenue Fund - 001
Personal Services $ 4,444,500 $ 4,435,783 $ (29,133) $ 4,406,650 $ 37,850
State contributions to
Social Security 340,100 329,409 (9,536) 319,873 20,227
Lump Sum Appropriation 899,900
Contractual Services 62,749 341,067 403,816
Travel 109,037 19,303 128,340
Commodities 13,907 5,831 19,738
Printing 13,160 2,742 15,902
Equipment 1,062 1,461 2,523
Electronic Data Processing 17,230 4,937 22,167
Telecommunications 109,276 109,276
Other Purposes 609 609
Subtotal 197,529
Total General Revenue Fund $ 5,684,500 $ 4,982,946 $ 445,948 $ 5,428,894 $ 255,606
Note: Appropriations, expenditures, and lapsed balances were obtained directly from the records of the State Comptroller,
which have been reconciled to agency records, except as noted in Finding 11-7.
45
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Appropriations for Fiscal Year 20 I 0
Fourteen Months Ended August 31, 2010
Appropriations Expenditures
P.A. 96-0042 (Net After Through
APPROPRIATED FUNDS Transfers) 6/30/10
Child Labor Enforcement Trust Fund - 357
Administration of Child Labor Law $ 500,000 $ 485,424
Total Child Labor Enforcement Trust Fund $ 500,000 $ 485,424
Department of Labor Federal Trust Fund - 724
Administration of Federal Project $ 1,500,000 $ 423,275
Total Department of Labor Federal Trust Fund $ 1,500,000 $ 423,275
Total- All Appropriated Funds $ 7,684,500 $ 5,891,645
NON-APPROPRIATED FUNDS
Department of Labor Special State Trust Fund - 251
Grants and Awards $ 1,085,201
Total All Non-Appropriated Funds $ 1,085,201
GRAND TOTAL ALL FUNDS $ 6,976,846
Note: Appropriations, expenditures, and lapsed balances were obtained directly from the records of the State Comptroller,
which have been reconciled to agency records, except as noted in Finding 11-7.
46
Lapse Period
Expenditures
7/01-8/31110
$ 12,865
$ 12,865
191,908
$ 191,908
$ 650,721
86,165
$ 86,165
$ 736,886
Total Balances
Expenditures Lapsed
$ 498,289 $ 1,711
$ 498,289 $ 1,711
$ 615,183 $ 884,817 -
$ 615,183 $ 884,817
$ 6,542,366 $ 1, 142,134
$ 1,171,366
$ 1,171,366
-
-
$ 7,713,732
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF NET APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Fiscal Year
2011 2010 2009
P.A. 96-0956 P.A. 96-0042 P.A. 95-0731
General Revenue Fund - 001
Appropriations
(Net of Transfers) $ 5,406,800 $ 5,684,500 $ 6,920,200
Personal Services $ 4,340,104 $ 4,406,650 $ 4,267,690
State contributions to
State Retirement 898,904
State contributions to
Social Security 324,071 319,873 316,821
Contractual Services 211,352 403,816 423,747
Travel 113,452 128,340 163,788
Commodities 16,439 19,738 29,373
Printing 3,811 15,902 18,356
Equipment 2,563 2,523 5,051
Electronic Data Processing 8,969 22,167 37,389
Telecommunications 109,221 109,276 86,053
Admin and Oper. Of Displaced
Homemaker Grant Program 27,389
Other Purposes 1,355 609
Equal Pay 197,253
Total Expenditures $ 5,131,337 $ 5,428,894 $ 6,471,814
Lapsed Balances $ 275,463 $ 255,606 $ 448,386
Child Labor Enforcement Trust Fund - 357
Appropriations
(Net of Transfers) $ 500,000 $ 500,000 $ 400,000
Administration of Child Labor Law $ 420,975 $ 498,289 $ 399,347
Lapsed Balances $ 79,025 $ 1,711 $ 653
Department of Labor Federal Trust Fund - 724
Appropriations
(Net of Transfers) $ 1,500,000 $ 1,500,000 $
Administration of Federal Project $ 1,146,765 $ 615,183 $
Lapsed Balances $ 353,235 $ 884,817 $
47
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF NET APPROPRIATIONS, EXPENDITURES AND LAPSED BALANCES
Fiscal Year
2011 2010 2009
P.A. 96-0956 P.A. 96-0042 P.A. 95-0731
GRAND TOTAL- ALL APPROPRIATED FUNDS
Appropriations (Net of Transfers) $ 7,406,800 $ 7,684,500 $ 7,320,200
Total Expenditures $ 6,699,077 $ 6,542,366 $ 6,871,161
Lapsed Balances $ 707,723 $ 1,142,134 $ 449,039
NON-APPROPRIATED FUNDS
Department of Labor Special State Trust Fund - 251
Grants and A wards $ 1,351,192 $ 1,171,366 $ 1,181 ,453
Total All Non-Appropriated Funds $ 1,351 ,192 $ 1,171 ,366 $ 1,181,453
GRAND TOTAL EXPENDITURES -ALL FUNDS $ 8,050,269 $ 7,713,732 $ 8,052,614
General Revenue Fund- 001 State Comptroller
State Officers' Salaries
Appropriations (Net of Transfers) $ 346,900 $ 346,900 $ 346,900
Director $ 121,493 $ 124,090 $ 124,090
Assistant Director 89,949 113,141 113,141
ChiefFactozy Inspector 49,780 52,179 52,179
Superintendent of Safety Inspection Education 28,698 57,396
Total Expenditures $ 261 ,222 $ 318,108 $ 346,806
Lapsed Balances $ 85,678 $ 28,792 $ 94
48
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SCHEDULE OF CHANGES IN STATE PROPERTY (NOT EXAMINED)
For the Two Years Ended June 30, 2011
Equipment
Balance at July 1, 2009 $ 486,945
Additions 201 ,718
Deletions
Net Transfers
Balance atJune 30, 2010 $ 688,663
Balance at July 1, 2010 $ 688,663
Additions 89,209
Deletions (13 ,332)
Net Transfers (113,613)
Balance at June 30, 2011 $ 650,927
Note: Data presented is considered not examined. The above schedule has been derived from property
reports submitted to the Office of the Comptroller. We were unable to reconcile the property records
submitted to the Office of the Comptroller to records maintained within the Department. See Finding
Code No. 11-3 and the Independent Accountants' Report on State Compliance, on Internal Control
over Compliance, and on Supplementary Information for State Compliance Purposes.
49
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF CASH RECEIPTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
Fiscal Year
GENERAL REVENUE FUND - 001 2011 2010
Private Employment Agencies Inspection Fees $ 95,720 $ 120,346
Labor Standards Fees 2,260 4,150
Carnival-Amusement Ride Inspection Fees 273,510 167,529
Nurse Agencies 64,000 87,775
Miscellaneous 14,997 11 ,166
Fines and Penalties 271,243 321,540
Total Receipts $ 721,730 $ 712,506
RECONCILIATION SCHEDULE OF CASH RECEIPTS TO DEPOSITS
REMITTED TO THE STATE COMPTROLLER (NOT EXAMINED)
For the Fiscal Years Ended June 30,
GENERAL REVENUE FUND - 001 2011 2010
Receipts per Department Records $ 721,730 $ 712,506
Add: Deposits in Transit,
Beginning ofYear * *
Less: Deposits in Transit,
End ofYear * *
Deposits Remitted to the Comptroller $ 719,384 $ 724,219
2009
$ 117,000
3,700
137,690
88,260
5,799
342,759
$ 695,208
2009
$ 695,208
245,127
(117,692)
$ 822,643
*Note: Data presented is considered not examined. See Finding Code No. 11-1 and the Independent
Accountants' Report on State Compliance, on Internal Control Over Compliance, and on
Supplementary Information for State Compliance Purposes.
so
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF CASH RECEIPTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
Fiscal Year
SPECIAL STATE TRUST FUND - 251 2011 2010
Collection of Labor Law Claims $ 1,526,089 $ 1,795,597
RECONCILIATION SCHEDULE OF CASH RECEIPTS TO DEPOSITS
REMITTED TO THE STATE COMPTROLLER (NOT EXAMINED)
For the Fiscal Years Ended June 30,
SPECIAL STATE TRUST FUND- 251 2011 2010
Receipts per Department Records $ 1,526,089 $ 1,795,597
Add: Deposits in Transit,
Beginning ofYear * *
Less: Deposits in Transit,
End ofYear * *
Adjustments
Returned Checks * *
Prior Year Warrant Voids * *
Other Adjustments * *
Deposits Remitted to the Comptroller $ 1,420,350 $ 1,923,191
2009
$ 1,687,235
2009
$ 1,687,235
390,696
(417,827)
(4,127)
2,340
$ 1,658,317
*Note: Data presented is considered not examined. See Finding Code No. 11-1 and the Independent
Accountants' Report on State Compliance, on Internal Control Over Compliance, and on
Supplementary Information for State Compliance Purposes.
51
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF CASH RECEIPTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
Fiscal Year
CHILD LABOR LAW ENFORCEMENT FUND- 357 2011 2010
Civil Penalties $ 20,940 $ 407,945
Day Labor Agencies Fees 390,750 4,500
Total Receipts $ 411,690 $ 412,445
RECONCILIATION SCHEDULE OF CASH RECEIPTS TO DEPOSITS
REMITTED TO THE STATE COMPTROLLER (NOT EXAMINED)
For the Fiscal Years Ended June 30,
CHILD LABOR LAW ENFORCEMENT FUND- 357 2011 2010
Receipts per Department Records l $ 411,690 $ 412,445
Add: Deposits in Transit,
Beginning ofYear * *
Less: Deposits in Transit,
End ofYear * *
Adjustments * *
Deposits Remitted to the Comptroller $ 410,590 $ 419,820
2009
**
**
$ 431,335
2009
$ 431,335
179,945
(11,845)
(1 ,250)
$ 598,185
* Note: Data presented is considered not examined. See Finding Code No. 11-1 and the Independent
Accountants' Report on State Compliance, on Internal Control Over Compliance, and on
Supplementary Information for State Compliance Purposes.
**Note:
Audit report for the fiscal year ending June 30, 2009 did not segregate civil penalty fees from day
labor agency fees. Therefore, these amounts have only been presented in total.
52
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF CASH RECEIPTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
Fiscal Year
EMPLOYEE CLASSIFICATION FUND- 446 2011 2010
Miscellaneous $ 21,917 $ 15,167
RECONCILIATION SCHEDULE OF CASH RECEIPTS TO DEPOSITS
REMITTED TO THE STATE COMPTROLLER (NOT EXAMINED)
For the Fiscal Years Ended June 30,
EMPLOYEE CLASSIFICATION FUND- 446 2011 2010
Receipts per Department Records $ 21,917 $ 15,167
Add: Deposits in Transit,
Beginning ofYear *
Less: Deposits in Transit,
End ofYear *
Adjustments
Returned Checks *
Other Adjustments *
Deposits Remitted to the Comptroller $ 21,917 $ 15,567
2009
$
2009
$
$
*Note: Data presented is considered not examined. See Finding Code No. 11-1 and the Independent
Accountants' Report on State Compliance, on Internal Control Over Compliance, and on
Supplementary Information for State Compliance Purposes.
53
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
COMPARATIVE SCHEDULE OF CASH RECEIPTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
Fiscal Year
FEDERAL PROJECTS FUND - 724 2011 2010
Administration of Federal Project $ 1,212,000 $ 544,663
RECONCILIATION SCHEDULE OF CASH RECEIPTS TO DEPOSITS
REMITTED TO THE STATE COMPTROLLER (NOT EXAMINED)
For the Fiscal Years Ended June 30,
FEDERAL PROJECTS FUND - 724 2011 2010
Receipts per Department Records $ 1,212,000 $ 544,663
Add: Deposits in Transit,
Beginning ofYear
Less: Deposits in Transit,
End ofYear
Adjustments
Returned Checks
Other Adjustments
Deposits Remitted to the Comptroller $ 1,212,000 $ 544,663
54
2009
$
2009
$
$
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF SIGNIFICANT VARIATIONS IN EXPENDITURES
For the Two Years Ended June 30, 2011
ANALYSIS OF SIGNIFICANT VARIATIONS IN EXPENDITURES BETWEEN FISCAL
YEARS 2011 AND 2010
General Revenue Fund (001)
Contractual Services and Electronic Data Processing
Contractual services and electronic data processing expenditures decreased during Fiscal Year
2011 due to the loss in appropriations for the year. The appropriations for Fund 001 decreased
$277,700 from the previous Fiscal Year. Department personnel stated that the amount paid to
the Department of Central Management Services varies according to what the Department can
afford each year, based on the appropriation it receives.
Child Labor Fund (357)
Administration of Child Labor Law
Administration of Child Labor Law expenditures decreased during Fiscal Year 2011 due to a
decrease in the number of employees being paid from this fund.
Department of Labor Federal Projects Fund (724)
Administration of Federal Projects
The increase in administration of Federal Projects was because the Department was able to use
the entire year for expenditures under the grant. The Department paid employees from this fund
and bought approximately $88,000 in equipment.
Special State Trust Fund (251)
Grants & A wards
The increase in grants and awards expenditures in Fiscal Year 2011 was due to an increase in the
number of claims paid. The number of claims paid fluctuates due to the number of wage claim
complaints filed and investigated.
55
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF SIGNIFICANT VARIATIONS IN EXPENDITURES
For the Two Years Ended June 30, 2011
ANALYSIS OF SIGNIFICANT VARIATIONS IN EXPENDITURES BETWEEN FISCAL
YEARS 2010 AND 2009
General Revenue Fund (001)
State Contribution to State Employees' Retirement System
State contributions to State Employees' Retirement System expenditures decreased during Fiscal
Year 2010 because the State did not make a contribution to State Employees' Retirement System.
Department personnel stated the Department has no control over the amount of State
contributions to retirement; this is determined at a Statewide level.
Travel
Due to Statewide cut-backs, the Department received a decrease in appropriations of $1,235,700
for Fund 001 during Fiscal Year 2010. As such, the Department was forced to decrease its
budget accordingly.
Electronic Data Processing and Telecommunications
Electronic data processing and telecommunications expenditures decreased during Fiscal Year
2010 due to the loss in appropriations for the year. The appropriations for Fund 001 decreased
$1,235,700 from the previous Fiscal Year. Department personnel stated that the amount paid to
the Department of Central Management Services varies according to what the Department can
afford each year, based on the appropriation it receives.
Displaced Homemaker Grant Program Administration
The Displaced Homemaker Grant Program was vetoed during Fiscal Year 2009 and therefore the
Department received no appropriations for this program. The amounts expended during Fiscal
Year 2009 were limited to salaries for Department employees for a review of proposals prior to
program deletion.
Equal Pay
Equal pay expenditures decreased during Fiscal Year 2010 because the Department did not
receive any appropriation for it during Fiscal Year 2010. In the previous year, the Department
received $206,400 in appropriations for equal pay expenditures.
56
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF SIGNIFICANT VARIATIONS IN EXPENDITURES
For the Two Years Ended June 30, 2011
Child Labor Fund (357)
Administration of Child Labor Law
Administration of Child Labor Law expenditures increased during Fiscal Year 2010 due to
increased enforcement efforts by the Department. Additionally, the appropriation for these
expenditures increased $100,000 from the previous Fiscal Year.
Department of Labor Federal Projects Fund (724)
Administration of Federal Projects
The Department received a grant in October 2009 to focus on improving workplace safety and
health for workers. The Depru.iment paid employees out of this fund and bought approximately
$106,000 in equipment to aid in achieving the purpose of the grant.
57
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF SIGNIFICANT VARIATIONS IN RECEIPTS
For the Two Years Ended June 30, 2011
ANALYSIS OF SIGNIFICANT VARIATIONS IN RECEIPTS BETWEEN FISCAL
YEARS 2011 AND 2010
General Revenue Fund (001)
Carnival-Amusement Ride Inspection Fees
The increase of $105,981 was due to an increase in carnival inspection fees in Fiscal Year 2011.
Fines and Penalties
The decrease of $50,297 is the result of increased compliance among employers and therefore a
decrease in the number of complaints filed by workers.
Special State Trust Fund (251)
Collection of Labor Law Claims
The decrease of $269,508 was due to a decrease in wage claim complaints by employees and
collections by the Department.
Department of Labor Federal Projects Fund (724)
Administration of Federal Project
The increase of $667,3 3 7 is the result of the Department maximizing its federal funding for the
OSHA Program in Fiscal Year 2011 . In the previous Fiscal Year, the Department only had these
federal funds available for nine months as the grant started in October 2009.
ANALYSIS OF SIGNIFICANT VARIATIONS IN RECEIPTS BETWEEN FISCAL
YEARS 2010 AND 2009
Special State Trust Fund (251)
Collection of Labor Law Claims
The increase of $108,362 was due to an overall increase in wage claim complaints by employees
and collections by the Department.
Department of Labor Federal Projects Fund (724)
Administration of Federal Project
The increase of $544,633 was due to an OSHA grant received in October 2009. The purpose of
the grant is to improve workplace safety and health of workers.
58
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF SIGNIFICANT LAPSE PERIOD SPENDING
For the Two Years Ended June 30, 2011
FISCAL YEAR 2011
General Revenue Fund (001)
Contractual Services, Telecommunications, and Electronic Data Processing
Contractual services, telecommunications, and electronic data processing expenditures during the
lapse period were mainly made as the Department attempted to catch up on payments for
services rendered by the Department of Central Management Services. See Finding Code No.
11-11 for further information.
Travel
Travel expenditures during the lapse period were mainly due to carnival and amusement ride
expenses, as the summer months are the busiest season for carnival and amusement ride
inspections.
Commodities
Commodities expenditures during the lapse period were the result of supply purchases being
delayed until late in the fiscal year in order to make sure the lump-sum appropriation would not
be needed to cover more critical expenditures.
FISCAL YEAR 2010
General Revenue Fund (001)
Contractual Services, Telecommunications and Electronic Data Processing
Contractual services, telecommunications, and electronic data processing expenditures during the
lapse period were mainly made as the Department attempted to catch up on payments for
services rendered by the Department of Central Management Services. See Finding No. 11-11
for further information.
Commodities
Commodities expenditures during the lapse period were the result of supply purchases being
delayed until late in the fiscal year in order to make sure the lump-sum appropriation would not
be needed to cover more critical expenditures.
Department of Labor Federal Projects Fund (724)
Administration ofFederal Project
Administration of federal project expenditures during the lapse period were the result of
expenditure transfers by the Department to better allocate expenditures to the grant.
59
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF ACCOUNTS RECEIVABLE (NOT EXAMINED)
For the Fiscal Years Ended June 30,
(amounts expressed in thousands)
General Revenue Fund (Fund 001) 2011 2010 2009
Age
Current $ 8 $ $
1-30 days
31-90 days 46 44
91-180 days 1,310 51 274
181 days to 1 year 131 154 421
Over 1 year 507 1,949 1,196
Total $ 1,956 $ 2,200 $ 1,935
Less: Allowance for Doubtful Accounts 262 262 262
Net Accounts Receivable $ 1,694 $ 1,938 $ 1,673
Child Labor Enforcement Fund (Fund 357)
Age
Current $ $ $
1-30 days
31-90 days
91-180 days 1
181 days to 1 year
Over 1 year 6 7 9
Total $ 7 $ 7 $ 9
Less: Allowance for Doubtful Accounts
Net Accounts Receivable $ 7 $ 7 $ 9
Note: Data presented is considered not examined. The above schedule has been derived from
Department records submitted to the Office of the Comptroller. We were unable to reconcile the
records maintained within the Department. See Finding No. 11-2 and the Independent Accountants'
Report on State Compliance, on Internal Control over Compliance, and on Supplementary Infonnation
for State Compliance Purposes.
60
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF OPERATIONS
For the Two Years Ended June 30, 2011
AGENCY FUNCTIONS AND PLANNING PROGRAM
The Illinois Department of Labor (Department) was created in 1917 through the Civil
Administrative Code. The Department administers and enforces various Illinois Labor Laws that
regulate wages, hours, working conditions, minors in the workforce, and licensing of employers
in certain businesses. Through the regulation of amusement rides, employment agencies, and
nurse registries, the Department protects and serves the people of the State of Illinois.
The Department promotes and protects the rights, wages, welfare, working conditions, safety and
health of Illinois workers through education and the enforcement of the State labor laws and
standards, and safeguards the public through the regulation of amusement rides.
Departmental operations are carried out through the following seven divisions:
1. The Administration Division provides support services and overall administrative
resources to the program divisions. These include fiscal/budget management,
procurement, legal division, personnel, legislative liaison services, electronic data
processing (EDP), and affirmative action.
2. The Legal Division was formed in 1997 as a separate group. The Division carefully
maintains a strict separation between its hearing and advocacy functions. The
administrative law judges convene informal hearings to determine if any laws
administered and enforced by the Department have been violated, to attempt to resolve
such matters equitably, and to decide whether there is sufficient evidence to recommend
court action. This group also convenes formal administrative hearings to adjudicate a
party's individual rights, duties, or privileges.
The Chief Legal Counsel and Assistant Legal Counsel prosecute on behalf of, or defends,
the Director and the Department in formal administrative hearings; drafts and analyzes
legislation; promulgates regulations; writes articles and issues opinion letters; oversees
the Department's lawsuits handled by the Office of the Illinois Attorney General and
various State's Attorneys offices; and provides advice and training for the Director and
the Department's staff.
The Legal Division administers "Alternative Claims Resolution" (ACR). This program
helps expedite the processing of wage claims filed with the Department. The Law
Division also administers "Court Review." This program ensures that the Department
only refers its strongest cases to the Office of the Illinois Attorney General and the
various State's Attorneys offices for prosecution.
61
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF OPERATIONS
For the Two Years Ended June 30, 2011
AGENCY FUNCTIONS AND PLANNING PROGRAM, continued
3. The Equal Opportunity Workforce Division administers the Equal Pay Act, the Victims
Economic Security and Safety Act (VESSA), the Private Employment Agencies Act, and
the Nurse Agency Licensing Act.
4. The Fair Labor Standards Division is responsible for administering and enforcing nine
statutes. These statutes include the Minimum Wage Law, Wage Payment and Collection
Act, Day and Temporary Labor Services Act, Child Labor Law, One Day Rest in Seven
Act, Farm Labor Contractor Certification Act, Industrial Homework Law, School
Visitation Rights Act, and Street Trades Law.
5. The Conciliation and Mediation Division enforces prevailing wage standards for workers
employed on public works projects. The Division also provides arbitration and mediation
services and enforces certain "whistleblower" protection laws.
6. The Public Employee Safety Division is responsible for occupational safety and health
regulations for an estimated 14,000 state and local governmental work sites. The
Division's jurisdiction extends protection to more than 727,000 employees working in
State, township, county and municipal governments, including park, school and fire
protection districts.
7. The Carnival and Amusement Ride Safety Division enforces safety standards through
annual inspections and the issuance of permits for amusement rides, inflated attractions,
ski lifts, rope tows, go-kart tracks, aerial trams, dry slides and some water amusements.
In addition, bungee cords and other elastic devices came under jurisdiction of the
Division in 1994. All amusement rides and amusement attractions open to the public are
subject to regulation. The Carnival-Amusement Safety Board develops rules, which the
Division enforces.
62
PLANNING PROGRAM
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF OPERATIONS
For the Two Years Ended June 30, 2011
The Department reviews and revises its fiscal year strategic plan annually. The Department's
plan delineates priorities and initiatives on which the Department will be focusing its efforts.
The plan also identifies five key priorities that provide the general framework for the
Department's operations. They are as follows:
1. Administer all state labor laws effectively.
2. Assure minimum wage, overtime, and wage claims are properly paid.
3. Promote and enforce the Equal Pay Act.
4. Assure prevailing wage is paid, when required.
5. Inspect public buildings and amusement rides for health & safety violations.
MONITORING
The progress on individualized tasks identified in the plan is monitored through monthly reports.
Each division prepares a monthly report, which reflects the division's activity during the month.
These reports are especially useful for the divisions that have field inspectors and employees
who work away from their Department's offices, as they show what the field inspectors have
been working on and have accomplished during the reporting period.
Additionally, the Department uses the Governor's Office of Management and Budget
Performance Reporting System and Process to develop and manage performance metrics to help
assess the Department's performance and progress in specific areas. For each metric, a specific
benchmark has been established to help assess the Department's performance. Management and
Department staff members evaluate the Department's progress in each of these areas on a
monthly or quarterly basis, depending on the nature of the metric.
SPECIAL STATE TRUST FUND
The Department operates the Special State Trust Fund (Fund 251) as an agency fund in the State
Treasury. The purpose of Fund 251 is to hold wage claims collected from employers by the
Department on behalf of Illinois workers (claimants) and hold those monies until the claimants
can be located and properly paid. According to records maintained by the Office of the
Comptroller, the balances in Fund 251 as of June 30, 2010 and June 30, 2011 were $1,524,265
and $1,513,315, respectively. We noted sweeps and transfers out of Fund 251, as administered
by the Governor's Office of Management and Budget, during Fiscal Year 2010 totaled $409,000.
We did not note any sweeps out of Fund 251 in Fiscal Year 2011. See Finding IM11-9 for
additional information.
63
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
ANALYSIS OF OPERATIONS
For the Two Years Ended June 30, 2011
AVERAGE NUMBER OF EMPLOYEES
The following table, prepared from Department records, presents the average number of employees,
by function, for the Fiscal Years ended June 30,
2011 2010 2009
Division
General Office 17 18 17
Child Labor and Day and Temporary Labor
Services Enforcement 2 2 8
Public Safety 32 14 17
Fair Labor Standards 39 38 39
Equal Pay Act and Victims Economic Security
and Safety Act 4 4 3
Total Average Full-Time Employees 94 76 84
64
STATE OF ILLINOIS
ILLINOIS DEPARTMENT OF LABOR
SERVICE EFFORTS AND ACCOMPLISHMENTS (NOT EXAMINED)
For the Fiscal Years Ended June 30,
A summary of operating statistics, prepared from Department records, is presented below.
PUBLIC EMPLOYEE SAFETY
Number of complaints received due to safety
problems noted in public buildings
Number of days spent on investigations of safety
problems noted in public buildings
Average number of days needed to investigate a
safety problem in a public building
CARNIV ALl AMUSEMENT RIDE SAFETY
Rides inspected
Number of amusement ride injuries due to
mechanical failure per 10,000,000 riders
CHILD LABOR LAW ENFORCEMENT
Number of child labor law complaints received
Percent of child labor complaints resolved
ILLINOIS PREVAILING WAGE
Prevailing wage complaints completed
Percent of complaints investigated and closed
within 180 days of receipt
2011
*
*
*
*
*
*
*
*
*
Fiscal Year
2010
40
206
5.2
4,736
1.0
45
100%
960
61%
* The Fiscal Year 2011 information was not available as of the date the report was prepared.
65
2009
45
273
6.1
4,348
33
100%
1,033
63%