ILLINOIS AUDITOR GENERAL HOLLAND TRIES TO PUTS HIS FINGER IN THE DIKE

I have written a number of times about what a great job the Illinois Auditor General is doing in ferreting out waste and mismanagement but there are two major problems with his office.  The first is that because there is such a morass of fraud in state agencies, there is no way that the IAG’s office can publicize all of their findings to the citizens of Illinois.  The second is that when we do hear about fraud, we never find out what has been done to correct the problems.

Last May I wrote about the IAG’s audit of Illinois’ All Kids Health Insurance and the millions wasted in that program.  So what has that agency done to correct the problems?  We have heard nothing about that.  It is so frustrating.  Illinois legislator’s should follow up on Holland’s reports and make sure that the fraud has been stopped.

The most recent IAG report deals with financial problems at Chicago State University (CSU.)  The school had a history of mismanagement and in the spring of 2009 CSU trustees appointed Wayne Watson, the retiring City Colleges of Chicago chancellor, as the university's next president replacing ousted leader Elnora Daniel.

Watson was not a popular choice.  CSU faculty and students had complained that they were excluded during the search process and 13 of the 15 members of the campus' search advisory committee resigned in protest a month before the Watson hiring.  When the Trustees announced Watson was the chosen successor, Yan Seacy, president of the Faculty Senate said, “I feel that I'm at a funeral, and we are presiding over the burial of hope and change.”

So how has CSU performed since May 2009 since Watson came on board?  A synopsis of the IG’s latest report said:

SYNOPSIS

 The University did not perform accounting reconciliations of certain receivables, prepaid expenses, and capital assets at the end of the current accounting period. We noted errors in the prior periods which resulted in adjustments recorded by the University.

 The University did not comply with the Uniform Disposition of Unclaimed Property Act and recorded a prior period adjustment for old accounting errors.

 The University did not properly report financial information for the University Auxiliary Facilities System Revenue Bond Fund.

 The University did not comply with certain requirements related to federal awards received from the United States Agency for International Development (USAID).

 The University did not fully comply with reporting requirements applicable to its Research & Development Cluster programs.

 The University did not reconcile its student financial assistance awards and expenditures on a monthly basis.

 The University did not prepare a complete and accurate Schedule of Expenditures of Federal Awards (SEFA).

 The University did not have adequate controls to ensure that vendors had not been suspended or debarred from participating in contracts funded by Federal awards.

 The University did not have adequate procedures to ensure compliance with OMB Circular A-133’s requirement to notify pass-through grantors of the results of the University’s audit.

 The University did not have adequate internal controls procedures over expenditures and activities related to the University’s Convocation Center.

 The University did not have adequate control over contracting procedures.

 The University allowed students with outstanding balances to register and attend classes in violation of the University’s policies and failed to send formal bills to students.

Now that it has been shown that CSU has not fared any better fiscally under Watson, will the Trustees let him stay?  The school has a pathetic 16% graduation rate (after 6 years).  Does that mean that CSU should wait six years and see if Watson succeeds?  I say expel him now.