REPORT OF THE AUDIT COMMITTEE

 

October 8, 2008

 

The Honorable,

The Board of Commissioners of Cook County

 

ATTENDANCE

 

Present:

Chairman Daley, Vice Chairman Goslin, Commissioners Butler, Gorman, Quigley and Schneider (6)

 

Ex-Officio Members:  Laura A. Burman – Cook County Auditor; and Donna L. Dunnings – Chief Financial Officer, Bureau of Finance (2)

 

Absent:

Commissioner Maldonado (1)

 

Also Present:

Commissioner Collins (1); Alexis A. Herrera – Chief Financial Officer, Office of the Sheriff; Lisa M. Walik – Director, Department of Risk Management; – John Morales – Cook County Comptroller; Wasiu Fashina – Chief Financial Officer, Clerk of the Circuit Court and David Small – Interim Chief Executive Officer, Cook County Health and Hospitals System

 

Court Reporter:     Anthony W. Lisanti, C.S.R.

 

Ladies and Gentlemen:

 

        Your Audit Committee of the Board of Commissioners of Cook County met pursuant to notice on Wednesday, October 8, 2008 at the hour of 11:00 A.M. in the Board Room, Room 569, County Building, 118 North Clark Street, Chicago, Illinois.

 

Chairman Daley entered into the record questions pertaining to various items on the agenda.  (see attached).

 

Commissioner Quigley stated his intention to submit questions at a later date.

 

        Your Committee has considered the following items and upon adoption of this report, the recommendations are as follows:

 

294136

MOTOR FUEL TAX FUND AUDIT REPORT NUMBER 38.  Transmitting a Communication, dated April 11, 2008 from Rupert F. Graham, Jr., P.E., Superintendent of Highways:

 

Submitting the Motor Fuel Tax Fund Audit Report Number 38 completed by the Illinois Department of Transportation for the County Fiscal Years 2005 and 2006, beginning December 1, 2004 and ending November 30, 2006.  This audit covers the Cook County’s allotments and expenditures of the Motor Fuel Tax Fund for the improvement and maintenance of the highway infrastructure and appurtenances.

 

The Illinois Department of Transportation is authorized to conduct an audit of the Cook County Motor Fuel Tax Fund by the Road, Bridge and Other Related Laws of Illinois, under the citations of ILCS 5/5-701.0 through 701.16, ILCS 5/5-402.0, and 30 ILCS 235/0.01 through 235/8.

 

*Referred to the Audit Committee on May 20, 2008.

 

Commissioner Quigley, seconded by Commissioner Butler, moved to receive and file Communication Number 294136.  The motion carried.

 

294145

INDEPENDENT AUDITOR’S REPORT OF THE FINANCIAL STATEMENTS.  Transmitting a Communication, dated May 6, 2008 from Maria Pappas, Cook County Treasurer:

 

Submitting herewith a copy of the Independent Auditor’s Report of the financial statements of the Cook County Treasurer’s Office as of November 30, 2007 and 2006.

 

*Referred to the Audit Committee on May 20, 2008.

 

Commissioner Quigley, seconded by Commissioner Butler, moved to receive and file Communication Number 294145.  The motion carried.

 

295908

CLERK OF THE CIRCUIT COURT, Transmitting a communication, dated August 18, 2008, by Dorothy Brown, Clerk of the Circuit Court:

 

Please find the submitted Fiscal Year 2007 Independent Auditor Report, which includes the Report of Independent Accountants on Compliance and Internal Controls for the Office of the Clerk of the Circuit Court.  Please accept this report and refer it to the Cook County Audit Committee for review.

 

* Referred to the Audit Committee on September 3, 2008.

 

Commissioner Gorman asked if the report contained any findings.

 

Laura Burman, Cook County Auditor, replied that one finding is detailed on page 36.  The auditors observed unreconciled differences in liability accounts.  The differences are being rectified.

 

Chairman Daley asked for a further explanation regarding management’s statement that a staff shortage is the reason why the Clerk of the Circuit Court was not able to reconcile the discrepancies between general ledgers and auxiliary ledgers.

 

Wasiu Fashina, Chief Financial Officer, Clerk of the Circuit Court, stated the 40 budgeted positions in the Accounting & Bookkeeping division for Fiscal Year 2008 are not all Certified Public Accountant positions.  The ledger discrepancy problem goes back many years, and has proven difficult to solve.  Staff must go to the record storage warehouse to locate old documents.  They will continue working on this problem.

 

Commissioner Quigley, seconded by Commissioner Butler, moved to receive and file Communication Number 295908.  The motion carried.

 

296222

INDEPENDENT AUDITOR’S REPORT – SHERIFF’S OFFICE.  Transmitting a Communication, dated August 20, 2008 from Thomas J. Dart, Sheriff of Cook County by Alexis A. Herrera, Chief Financial Officer:

 

Submitting the Independent Auditor’s Report dated July 21, 2008 from Sam Macaluso & Associates, Inc., Certified Public Accountants for the period ending November 30, 2007.  This audit contains a Statement of Revenues Collected, Expenditures Paid and Changes in Fund Balances for the Federal Equitable Sharing Program and the State Equitable Sharing Program administered by the Cook County Sheriff’s Office.

 

*Referred to the Audit Committee on September 17, 2008.

 

Vice Chairman Goslin, seconded by Commissioner Schneider, moved to receive and file Communication Number 296222.  The motion carried.

 

296224

COOK COUNTY’S HEALTH FACILITIES FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED NOVEMBER 30, 2007.  Transmitting a Communication, dated September 15, 2008 from Donna L. Dunnings, Chief Financial Officer, Bureau of Finance:

 

Subject:     Health Facilities Financial Statements for the

Fiscal Year ended November 30, 2007

 

Submitting herewith a copy of Cook County’s Health Facilities Financial Statements for the fiscal year ended November 30, 2007, prepared by the Cook County Bureau of Health Services and audited by Deloitte & Touche, LLP.  Respectfully request that the report be referred to the Cook County Board’s Audit Committee for further consideration.

 

*Referred to the Audit Committee on September 17, 2008.

 

Chairman Daley informed the Committee that this report is also before the Audit Committee of the Cook County Health and Hospitals System Board.

 

Commissioner Goslin asked for an explanation about the statistics showing a decline in the number of patients who were using Cook County health services in 2007.

 

David Small, Interim Chief Executive Officer of the Cook County Health and Hospitals System, replied that after the Board of Commissioners approved a substantially reduced budget for the system at that time, the resulting cutback in services caused the decline in patient census numbers. He further observed that average length of hospital stays is declining as part of a national trend.

 

John Morales, Cook County Comptroller, discussed ongoing efforts to improve the reporting capability of the JD Edwards financial management system. It is his belief that the software is not being utilized to its fullest capacity in the Health and Hospital System. To improve the program may require an additional cost.

 

Commissioner Collins said she is reluctant to approve any more spending on technology-related initiatives until cost savings from previous projects are documented.

 

Vice Chairman Goslin, seconded by Commissioner Butler, moved to receive and file Communication Number 296224.  The motion carried.

 

296225

COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR) FOR THE FISCAL YEAR ENDED NOVEMBER 30, 2007.  Transmitting a Communication, dated September 15, 2008 from Donna L. Dunnings, Chief Financial Officer, Bureau of Finance:

 

Subject:     Comprehensive Annual Financial Report (CAFR)

for the Fiscal Year ended November 30, 2007

 

Submitting a copy of Cook County’s Comprehensive Annual Financial Report (CAFR) for the fiscal year ended November 30, 2007, prepared by the Cook County Office of the Comptroller and audited by Deloitte & Touche, LLP.  Respectfully request that the report be referred to the Cook County Board’s Audit Committee for further consideration.

 

* Referred to the Audit Committee on September 17, 2008.

 

Chairman Daley stated the Management Letter that traditionally accompanies the CAFR is not complete, and therefore it may be appropriate to defer this matter.

 

Ms. Dunnings replied the Management Letter will be complete by October 15, 2008.

 

Vice Chairman Goslin, seconded by Commissioner Gorman, moved to defer consideration of Communication Number 296225.  The motion carried.

 

296226

COOK COUNTY ACTUARIAL ANALYSIS FOR THE FISCAL YEAR ENDED NOVEMBER 30, 2007.  Transmitting a Communication, dated September 15, 2008 from Donna L. Dunnings, Chief Financial Officer, Bureau of Finance:

 

Subject:    Cook County Actuarial Analysis for the year ended November 30, 2007

 

Submitting a copy of Cook County’s Actuarial Analysis for the fiscal year ended November 30, 2007, prepared by ARM Tech, a subsidiary of Aon Corporation.  Respectfully request that the report be referred to the Audit Committee for further consideration.

 

*Referred to the Audit Committee on September 17, 2008.

Commissioner Gorman inquired if there were any efforts to reduce the number of claims identified in the Actuarial Analysis?

 

Lisa Walik, Director of the Department of Risk Management, detailed the department’s ongoing efforts to reduce the number of incidents that result in claims against the County’s Self-Insurance program.

 

Vice Chairman Goslin, seconded by Commissioner Butler, moved to receive and file Communication Number 296226.  The motion carried.

 

Commissioner Butler, seconded by Vice Chairman Goslin, moved to adjourn the meeting.  The motion carried and the meeting was adjourned.

 

YOUR COMMITTEE RECOMMENDS THE FOLLOWING ACTION

WITH REGARD TO THE MATTERS NAMED HEREIN:

 

Communication Number 294136                   Received and Filed

Communication Number 294145                   Received and Filed

Communication Number 295908                   Received and Filed

Communication Number 296222                   Received and Filed

Communication Number 296224                   Received and Filed

Communication Number 296225                   Deferred

Communication Number 296226                   Received and Filed

 

 

 

 

Respectfully submitted,

Audit Committee

 

 

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John P. Daley, Chairman

 

 

Attest:

 

 

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Matthew B. DeLeon, Secretary

 

 

The transcript and audio recording for this meeting is available from the Office of the Secretary to the Board, 118 North Clark Street, Room 567, Chicago, IL 60602.