Key Audit Issues 2017 Points Out Impact of Repeat Findings, Lack of Effective Financial Controls, $1.6 Billion in Waste and Inefficiencies
Louisiana continues to be challenged by a failure to address repeat audit findings, a lack of effective internal fiscal controls, and at least $1.6 billion in waste and inefficiencies across state and local government, the Legislative Auditor said in the LLA’s annual report, which was released today.
The audits summarized in Key Audit Issues 2017 reflect a portion of nearly 4,500 reports released in calendar year 2016 and are representative of issues, findings, and/or problems deemed important by the LLA. The $1.6 billion figure was calculated from findings reported to the Joint Legislative Committee on the Budget. State law requires that the LLA report all audit findings that exceed $150,000 to the JLCB both quarterly and annually.
The annual report takes on more importance as Louisiana struggles with another year of fiscal crisis, Legislative Auditor Daryl Purpera said. For the most part, he said, the state has the statutory and constitutional tools in place to encourage efficient financial operations. However, those tools need to be used in a consistent and disciplined manner to be effective.
“The goal of the annual report is to call these issues to the attention of lawmakers, agency management, and the public,” Purpera said, “and to encourage open, transparent discussion on how best to address these concerns.”
While the approximately $1.6 billion identified in the Act 461 Reports cannot be looked at as a possible solution to the state’s current budget problems in its entirety, it does represent at least:
· $15.5 million owed to the state that was not collected;
· $413.2 million in revenue lost because the state either paid out or potentially paid out more money than it needed;
· $13.6 million in revenue lost because of weak internal fiscal controls;
· $591.3 million that could be lost if the federal government requires repayment of funds;
· $87.3 million that could be lost because of the failure to keep track of movable property;
· $124.6 million in revenue lost because the expenditures did not have the expected results.
For more information contact:
Daryl G. Purpera, CPA, CFE