Multiple Agencies
The 1999 Statewide Single Audit Report
May 2000
Report Number 00-555
Overall Conclusion
In general, State agencies and universities do a good job of controlling financial resources and complying with state and federal laws and regulations. However, we found some serious exceptions.
The annual Statewide Single Audit includes audits of the State's annual financial report and major federal programs. Because the same business processes are used for state and federal dollars, the federal program audit provides assurance that state funds are spent appropriately. The 33 audited federal programs represent 73 percent of $18.7 billion of fiscal year 1999 federal funding.
Key Facts and Findings
Contract administration continues to be a serious problem at the Commission on Alcohol and Drug Abuse, the Department of Housing and Community Affairs, the Department of Protective and Regulatory Services, and the Texas Education Agency. Despite improvements, monitoring of contractors is still not adequate to ensure the State receives agreed-upon services. In fiscal year 1999, the State paid contractors at least $9.5 billion in federal funds to provide services to citizens.
The accounting system and financial reporting continue to be a concern at the Texas Education Agency (Agency). Although the Agency has improved, policies and procedures do not ensure that financial data is accurate. For example, the federal program report did not show all federal award activity accurately. The Agency accounts for expenditures of approximately $12 billion, which includes $2 billion in federal funds.
Five of eight universities audited did not report enrollment changes on time as required by the Federal Family Education Loans program (CFDA 84.032). Reporting changes in enrollment lets lenders know when students should begin repaying loans. Since 1995, 21 universities have not complied with these reporting requirements. Follow-up audits at 12 universities indicate that 11 have corrected the issue or made progress in correcting it.
Four agencies-Department on Aging, Comptroller of Public Accounts, Department of Criminal Justice, and Teacher Retirement System-had no findings in all areas tested. In addition, all 29 agencies and universities audited for compliance with bond covenant requirements had no findings.
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