Sincerely,
Robert G. Cramer
Secretary
Referred to committee on Government Operations and Spending Limitations.
__________________
Agency Reports
State of Wisconsin
Legislative Audit Bureau
Madison
March 31, 2003
To the Honorable, the Legislature:
We have completed our financial and compliance audit of the State of Wisconsin, as requested by state agencies to meet the audit requirements of the federal Single Audit Act of 1984, as amended, and the provisions of federal Office of Management and Budget Circular A-133. Our audit covered the period July 1, 2001 through June 30, 2002. In addition to satisfying federal audit requirements, the audit assists us in meeting state audit requirements under s.
13.94, Wis. Stats.
A154
Audit procedures performed at the larger state agencies that administer federal financial assistance programs, including the University of Wisconsin System, consisted of gaining an understanding of the internal controls at the agencies, assessing the propriety of revenues and expenditures, and testing compliance with laws and regulations related to the administration of federal grant programs. For the smaller agencies and selected University of Wisconsin campuses, our audit procedures were limited to verifying information included in the federally required State of Wisconsin Schedule of Expenditures of Federal Awards and following up on prior-year audit findings. Our review focused on the 25 federal grants that either exceeded the $22.2 million threshold used to define major grants or were below this threshold but were selected for review based on the risk-based assessment criteria established by the federal government.
Our report contains the auditor's reports on compliance and internal control. Because of material noncompliance by the Department of Health and Family Services and the Department of Corrections related to the Foster Care - Title IV-E program, we qualify our opinion on the State's compliance with federal requirements. Our audit opinion on the State of Wisconsin Schedule of Expenditures of Federal Awards for the audited period is unqualified.
The agency narratives contain our comments on internal control deficiencies related to the administration of federal grants, findings of noncompliance for each agency, and the results of our follow-up to prior audit findings. A summary schedule of findings and questioned costs for the current year's audit is also provided, as well as a summary of the status of findings included in our prior audit report for the State of Wisconsin (report 02-7). We note that, overall, state agencies have complied with federal grant requirements and have taken steps to address findings included in the prior year's single audit report. However, we report internal control deficiencies and several areas of noncompliance, and we identify $847,283 in questioned costs. While higher than last year's questioned costs, this year's amount represents a small portion of the $8.1 billion in federal financial assistance to the State of Wisconsin.
The federal government will resolve the findings and questioned costs included in our report. Federal agencies are expected to contact state agencies regarding resolution. To assist federal officials in their efforts, state agency contact information is provided in appendices to this report.
In addition to the comments and recommendations included in our report, separate audit communications will be issued to various state agencies addressing technical accounting and internal control issues, including those relating to the preparation of the State's financial statements.
We appreciate the courtesy and cooperation extended to us by agency staff during our audit. Agencies' comments on individual findings, along with their corrective action plans to address our concerns, are included within the agency narratives.
Respectfully submitted,
Janice Mueller
State Auditor
__________________
State of Wisconsin
Legislative Audit Bureau
Madison
April 4, 2003
To the Honorable, the Legislature:
We have completed a review of the Office of Justice Assistance's (OJA's) administration of the Juvenile Accountability Incentive Block Grants program at the request of several legislators, including Representative David Cullen, who first requested it. The purpose of the program is to assist states and localities in making delinquent juveniles accountable for the crimes they commit. From the program's inception in 1998 through September 2001, the State received $17.3 million in federal grant funds, and an additional $1.1 million in interest earnings from these funds.
We found serious deficiencies in OJA's management of the program, which resulted from a noncompetitive grant award process, inadequate oversight by the 27-member Juvenile Justice Commission, and the significant discretion allowed OJA's former Executive Director. We question a total of $279,033 in expenditures that were funded primarily by the program and are either inconsistent with its purpose or excessive for a state agency. This amount includes $149,784 in expenditures incurred during fiscal year 2001-02, which are reported in our 2001-02 single audit report (report 03-5).
From federal fiscal year 1997-98 through federal fiscal year 2001-02, the Department of Corrections was awarded $3.7 million in Juvenile Accountability Incentive Block Grants funds without consideration of statewide priorities, which had not been developed. We include a recommendation for OJA to establish a competitive process for distributing all program funds to local governments and state agencies.
We appreciate the courtesy and cooperation extended to us by OJA staff during our review.
Respectfully submitted,
Janice Mueller
State Auditor
