FY2013 Annual Audit Presentation May 27, 2014 Committee of the - PowerPoint PPT Presentation

FY2013 Annual Audit Presentation May 27, 2014 Committee of the Whole Wermer, Rogers, Doran, & Ruzon LLC

Why is the County audited?  Required by Illinois Statute.  Resources, such as taxes, are needed to carry out many statutory duties – Sheriff, Coroner, Treasurer, etc.  What has the tax money been spent on?

Audit Basics The objective of the County’s annual audit is:  To form an opinion on the accuracy of the County’s financial statements in conformity with generally accepted accounting principles.  To determine if the County is compliant with federal program requirements (single audit) and certain laws & regulations.

County Board’s Role  Oversight of County operations, including budgeting and financial reporting.

Management’s Role vs. Auditor’s Role  Financial statements are the responsibility of management (Finance Department) - NOT the auditor.  Auditor’s role MUST be limited according to auditing standards (“independent”).

Finance Department  Must maintain effective control over the financial reporting process.  Must maintain effective control over the budgetary process.

Finance Department  Responsible for development and implementation of procedures for various transactions - initiating, authorizing, recording, processing, and reporting.  Responsible for maintaining the accounting records and supporting information.

Support for Accounting Transactions  The County’s policies require all accounting transactions to be supported by proper documentation.  Documentation depends on the type of transaction. Examples include: receipts, invoices, bank deposit slips, etc,.  Auditors must review source documents (usually a sample).

Source documents should answer the following questions:  Where is the money coming from (revenue) – and what fund is going to spend from?  What was the money used for & why (disbursement)?  Who authorized the transaction?  What is the amount of the transaction?  What accounting period is the transaction associated with?

Other Year-End Financial Information  Accrued Receivables – What is owed to County  Accrued Payables – What the County owes to others  Capital Assets – valuation and reporting  Long-term Debt – bonds and debt certificates  Adherence to accounting standards  GFOA Certificate of Achievement

Audit Procedures  Review board minutes.  Assess the risks of fraud.  Test controls and Develop audit programs.  Test transaction classes – revenues, expenditures, assets, liabilities, federal grants.  Prepare draft financial statements for review by Finance, Internal Audit and Treasurer.  Revise drafts, provide auditor’s report.