Ill. Admin. Code tit. 47, § 1.130 - Audits
a) In compliance
with Section 1745(a) of P.L. 97-35 ( 31 U.S.C. 1243 ), the Department shall
have prepared an annual independent financial and compliance audit of its
Community Development Assistance Program, Illinois Home Energy Assistance
Program, and Community Service Block Grant Program (CSBG) grants, and
Neighborhood Corps Program grants supported by CSBG funds.
b) Grantees who are subject to the Single
Audit Act of 1984 (
31
U.S.C. 7501 -
7507 ) and OMB Circular A-128:
Audits of State and Local Governments (50 FR 19114, May 6, 1985) must comply
with the provisions of same.
c)
Grantees intending to procure and manage a financial and compliance audit of
their grant, must inform the Department in writing during the first quarter of
the grant period. The Grantee must set aside grant funds to support such audit;
the Department will not reserve funds for the purpose of auditing a grant for
which the grantee has indicated it will procure and manage an audit. If the
Grantee fails to have an audit performed within one year from the end of its
fiscal year, the Department will withhold current grant funds from the Grantee
until previous audit commitments have been met.
d) The following requirements will apply to
financial and compliance audits procured and managed by the Department .
1) The Department will procure and manage the
audit of grants, except in the case where the Grantee is conducting the audit
in accordance with subsection (c) or an audit is conducted as a mandatory
requirement of a federal OMB Circular. Such audits will satisfy the
Department 's audit requirements where grant activities are included in the
audits and the audits are performed and the reports prepared per federal and
state requirements.
2) The
Department will make payment for audits of Illinois Home Energy Assistance
Program grants. The CSBG Grantee will make payment for audits of CSBG grants
and Neighborhood Corps Programs administered through CSBG grantees.
3) Audits of appropriate program records must
be performed by an independent public accountant, certified and licensed by
authority of the State of Illinois. The audit must be conducted in accordance
with generally accepted government auditing standards adopted by the AICPA
(1981).
4) When audits are procured
by the Department , the Grantee will:
A) work
cooperatively with the audit firm selected;
B) actively work with both the audit firm and
the Department to resolve any and all audit findings; and
C) work cooperatively with the Department 's
staff in preparing for, conducting, and resolving audits.
e) The following requirements will
apply to a Grantee which procures the financial and compliance audit of its
grant(s).
1) The Grantee shall be responsible
for having an annual audit of all grant records and such audit must be
performed by an independent public accountant, certified and licensed by
authority of the State of Illinois. The Audit must be conducted in accordance
with generally accepted government auditing standards adopted by the AICPA
(1981).
2) The Grantee may secure
an independent audit of its grant in the same manner as it secures its regular
audits, provided it provides for maximum open and free competition. The grant
audit should be conducted as part of the Grantee 's annual audit. Where federal
funds are to be audited the Grantee must procure the audit firm in compliance
with Appendix A, Attachment O of this Part.
3) That portion of the Grantee 's annual audit
which addresses grant activities shall be paid for by the Grantee with grant
funds.
4) The Grantee will provide
the Department with 6 copies of its annual audit which addresses Department
grant(s). In instances where the grant period or term does not coincide with
the Grantee's fiscal year, two fiscal audit reports shall be forwarded to the
Department .
f) The
Department 's audit resolution process is as follows:
1) Upon receipt of an audit, Department staff
review the audit to assure it is complete (i.e., required information in
accordance with generally accepted government auditing standards and
contractual requirements with the audit firm such as Statement of Revenues and
Expenditures, report on internal control, report on compliance, audit
concurrence which is written correspondence from the grantee stating that it
agrees with the contents of the audit report, findings, recommendations and
responses, and auditors opinion on the financial statement) and accurate as
evidenced through a verification of any mathematical calculations contained in
the audit. If the audit is incomplete or inaccurate, the audit firm is
contacted in writing and required to submit necessary additional/revised
information.
2) If all audit
findings are resolved (i.e. the grantee repays any misspent funds and/or the
grantee has taken corrective action to ensure that the problems/findings are
corrected), a final determination letter is transmitted to the grantee and
indicates:
A) the Department has accepted
grantee's responses to any audit findings as contained in the audit
report;
B) procedures governing the
grantee 's remittance of any grant funds on hand and due to the
Department ;
C) the Federal grantor
agency has final authority relative to the allowability of costs for funds
audited and the Department reserves the right to obtain any resultant
reimbursement from the grantee; and
D) the decision to disallow certain
questioned costs is subject to the appeal provisions of 47 Ill. Adm. Code 10
(Review and Appeal Procedures).
3) If the audit contains unresolved findings,
the Department transmits a certified letter to the grantee requesting written
response to audit findings within thirty (30) days.
A) If the grantee fails to respond within
thirty (30) days, a final determination letter is transmitted to the grantee
disallowing any costs associated with audit findings and demanding
reimbursement to the Department for such costs within thirty (30) days. Formal
debt collection procedures are then initiated if funds are not received by
final date payment is due.
B) Upon
receipt of grantee 's response, an initial determination letter is transmitted
indicating any responses to audit findings which were accepted by the
Department and requiring payment of funds due to the Department within thirty
(30) days. The grantees's failure to remit funds, as required, to the
Department results in transmittal of a final determination letter to the
grantee demanding payment within thirty (30) days. If reimbursement to the
Department is not received within required time frame, a first demand letter
requiring payment within ten (10) days is transmitted to the grantee. If
payment again is not received by date due, a second demand letter stating that
legal action will be initiated if payment is not received within the required
time frame is transmitted to the grantee. Failure of grantee to comply within
ten (10) days will result in Department initiating formal debt collection
procedures.
g) The Department reserves the right to
conduct special audits, including but not limited to an agency-wide audit, at
any time during normal working hours of funds expended under Department
grants.
h) Any independent public
accounting firm that provides consulting services to a Grantee is prohibited
from conducting an audit of that Grantee for the program year during which
services were rendered.
Notes
Amended at 13 Ill. Reg. 20321, effective December 15, 1989
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