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* Right of Center Square…
Illinois is the only state in America that has yet to release its official report from fiscal year 2018 and state officials don’t yet know when it will be released.
Every state, most cities, and other forms of government must have a comprehensive annual financial report, or CAFR, done as a way for not only citizens to better understand their local government finances, but also to give officials a better idea on the baseline costs for upcoming budgets.
Illinois is often one of the last states to finish its report and this year, state officials have yet to do it, making it the latest since 2011 when Comptroller-turned Deputy Gov. Dan Hynes released it on June 30, 2012, a full year after the fiscal year ended. […]
A 2011 report from the Governmental Accounting Standards Board, which dictates best practices for many functions in public governance, found the average amount of time it took for a state to release a CAFR was less than 7 months.
In surveys, GASB found that the information released via these reports “diminishes quickly” in value after six months. Bondholders often use the information found in CAFRs to gauge the creditworthiness of a unit of government before bidding on an offering, which Illinois plans to do soon.
According to the Auditor General’s office, the latest a CAFR was ever released was August 24, 2006, for the previous fiscal year that ended June 30, 2005. The CAFR for fiscal years 2008, 2009 and 2010 were all issued in July of the following years. So, as mentioned above, this isn’t new.
* Comptroller Mendoza…
State Comptroller Susana A. Mendoza Wednesday declared her continued displeasure with the pace of release of the State’s Comprehensive Annual Financial Report (CAFR). Monday marks the beginning of a new fiscal year, and we are still without the fiscal year 2018 CAFR.
The Illinois Office of Comptroller compiles the CAFR from reports submitted to the Office from individual state agencies that are required to be audited by the Illinois Auditor General. If any of those audits are not complete, the Comptroller cannot publish the CAFR.
The timeliness of the issuance of the CAFR has been an issue that spans back since fiscal year 1999, marking the last time the report met its reporting date. In six of the last 12 years, the CAFR has come out in June or later, a year after the end of the fiscal year. In 2009, it came out in July. The state appears on-track to match or beat that dubious record this year.
The lateness this year does not fall on the Comptroller’s Office, the Auditor General or the current leadership of the state agencies. It appears there are issues from this audit period dating from the previous administration’s management. The current administration and leadership of those agencies are working to resolve them and account for them in their reports to the Auditor General.
The Comptroller’s Office stands ready, as it has been since December, to publish the CAFR as soon as the remaining audits are completed.
“My first year in office, we got the CAFR out in February. Last year, the CAFR was issued in early March,” Mendoza said. “I am highly concerned and disappointed that this process is taking so long. My hands are tied until we get the final audited reports from the Auditor General.” [Emphasis added.]
CAFRs are hugely important, but Illinois, as usual, is so backwards that we lag behind the rest of the country. We are the only state that doesn’t have a single financial reporting system. And despite hundreds of millions of dollars spent on new systems, way too many agency systems are one-offs that can’t communicate with anyone else.
The auditor general has to put together an audited financial report by going through each individual agency, and if some big agencies are found not to be in compliance, that can really mess things up.
Auditor General Frank Mautino told me today that these problems are especially acute “when you have dysfunctional government, dysfunctional agencies.” He couldn’t be more specific because the audit process is confidential.
posted by Rich Miller
Wednesday, Jun 26, 19 @ 11:30 am
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Thanks Rauner.
Comment by Former State Worker Wednesday, Jun 26, 19 @ 11:42 am
Aside from the traditional very tardy completion, is anyone else wondering how accurate it is once it is deemed “completed”?
Comment by A guy Wednesday, Jun 26, 19 @ 11:45 am
Former State Worker-This issue goes beyond Rauner, though he did not help resolve it. Why does Illinois not have a single financial reporting system? That is the question we should be asking.
Comment by SpfdNewb Wednesday, Jun 26, 19 @ 11:47 am
When the news is so bad, why be in a hurry to publish?
Comment by SSL Wednesday, Jun 26, 19 @ 11:49 am
Former State Worker-This issue goes beyond Rauner, though he did not help resolve it. Why does Illinois not have a single financial reporting system? That is the question we should be asking
Because they paid billions for an ERP system that can’t produce reports. Be careful
what is wished sometimes the beans are not magical.
Comment by Anon Y Wednesday, Jun 26, 19 @ 11:52 am
-Because they paid billions for an ERP system that can’t produce reports. Be careful
what is wished sometimes the beans are not magical.-
So incompetence strikes again is what you are saying. I expected as much but its nice to see it spelled out.
Comment by SpfdNewb Wednesday, Jun 26, 19 @ 11:55 am
“It appears there are issues from this audit period dating from the previous administration’s management”
Shouldn’t this have come up in one of the previous 3 audits?
== is anyone else wondering how accurate it is once it is deemed “completed”?==
It’ll be GASB accurate. The only question is what new GASB statement will be adopted this year that’ll send us into a deeper tailspin.
Comment by City Zen Wednesday, Jun 26, 19 @ 12:06 pm
More taxes will fix this I’m sure.
Comment by DuPage Moderate Wednesday, Jun 26, 19 @ 12:08 pm
I’m suspect part of those issues is all the money shuffling between the revolving funds under the previous administration to get around spending restrictions when there was no budget.
Comment by RNUG Wednesday, Jun 26, 19 @ 12:11 pm
Blame it on the previous administration. So weak. So so weak.
Comment by allknowingmasterofraccoodom Wednesday, Jun 26, 19 @ 12:18 pm
This has been going on for years. May have gotten worse under Rauner, but from my experience with DHS none of this surprises me. Asking DHS for any financial information, and you will get several answers….no one seems to know anything….
Comment by Wondering Wendy Wednesday, Jun 26, 19 @ 12:30 pm
RNUG for the win.
That’s exactly what happened.
I doubt they will ever truly figured out what happened.
Comment by Honeybear Wednesday, Jun 26, 19 @ 1:00 pm
not sure if quoting Mautino about transparency adds or detracts from delinquency?
Comment by icky Wednesday, Jun 26, 19 @ 1:14 pm
Center Obtuse Triangle
Comment by Da Lobsta Wednesday, Jun 26, 19 @ 1:40 pm
It’s also not helpful that fiscal years never seem to end. When you stretch the fiscal year lapse through the end of October and then pay bills for the prior year through December you aren’t even closing out the year until 6 months into the next fiscal year.
Comment by Demoralized Wednesday, Jun 26, 19 @ 1:45 pm
I blame Dan Hynes.
That is some good reading on the Opaque Oblong.
Comment by Al Wednesday, Jun 26, 19 @ 1:48 pm
Many State agencies, just like the private sector, did piecemeal computerization, since there was no vision of completely computerizing operations. As a result, many systems are still stand-alone, some antique by today’s standards, and building integrated cross-agency platforms for common purposes (such as budgets and reporting) are unfunded or under-funded (Auditor General reports are full of such references) that impact ability to answer standard financial questions or generate data for trends. Overall State computing is stuck in 1990’s if not earlier despite pretty websites (some of which are terrible to work with).
Comment by revvedup Wednesday, Jun 26, 19 @ 2:46 pm
There is no such thing as an Oracle or SAP “State of Illinois accounting software package” that is updated on an ongoing basis. And using Commercial Off The Shelf software packages isn’t really feasible - anyone have any horror stories to share about the financial ERP?
Comment by Anyone Remember Wednesday, Jun 26, 19 @ 3:09 pm
The link to Center Sqaure is incorrect - link takes you to Kankakee Daily Journal
Comment by Marko Wednesday, Jun 26, 19 @ 4:13 pm
What is Mautino’s job again?
Comment by Chicagonk Wednesday, Jun 26, 19 @ 4:32 pm
A recent letter from the governor said all agencies will be on the ERP system so there will be a single financial reporting system. Except for the Comptroller’s office, which makes no sense.
Comment by IT Guy Wednesday, Jun 26, 19 @ 6:52 pm
===I’m suspect part of those issues is all the money shuffling between the revolving funds under the previous administration to get around spending restrictions when there was no budget.===
More likely it is one large “material” agency (e.g., HFS, DHS, Lottery, Revenue) that has a major audit issue that the external auditor that the auditor general contracts with will not sign off on.
That being said, it’s not the Comptroller’s Office fault. The auditor general, however, has the authority to control the audit by requiring an opinion or qualifying or disclaiming an opinion on that agency’s financial statements if not timely completed. I’m not sure former legislator Mautino isn’t playing politics. Our sorry state.
Comment by Justacitizen Wednesday, Jun 26, 19 @ 7:18 pm
Justacitizen
What if they qualified / disclaimed opinion for the agency results in the State CAFR getting a qualified / disclaimed opinions? The effect on bond sales would be disastrous.
Comment by Anyone Remember Wednesday, Jun 26, 19 @ 7:53 pm
Audits look back at the fiscal year that already happened. So I’m not sure how waiting a year can fix a problem or problems that already happened. Materiality could also save the statewide CAFR (I.e., something material at the agency level may not be material at the statewide level).
Comment by Justacitizen Thursday, Jun 27, 19 @ 9:11 am
Same story. Different year.
Comment by Dirty Red Thursday, Jun 27, 19 @ 9:42 am