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

• n?

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

• f 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

• thers

 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.