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Comptroller of Public Accounts

1994 Statewide Financial and Compliance Audit

Report Number 95-119

Overall Conclusion

The Comptroller's Office collected and accurately reported $17 billion in net tax revenues and transfers of $10.6 billion during fiscal year 1994. As the State's financial reporting officer, the Comptroller is responsible for compiling and publishing the State's Comprehensive Annual Financial Report (CAFR). The Comptroller's Office can make improvements to the State's financial reporting process. In addition, the Comptroller's Office had continuing difficulties reconciling cash between the Uniform Statewide Accounting System and the Treasury's cash accounting system during fiscal year 1994.

Key Findings

The Comptroller's Office should improve the effectiveness of the Financial Reporting Section's quality control function to ensure that errors in draft versions of the CAFR are detected and corrected prior to review by the State Auditor's Office. The Comptroller has established an independent quality assurance function that will be responsible for providing more timely detection and correction of such financial reporting errors.

The Uniform Statewide Accounting System (USAS) is not currently used to generate the CAFR. Currently, the State compiles its financial position once a year by an extensive, mostly manual, consolidation of the relevant financial data. The Comptroller's Office is developing a detailed action plan to meet this USAS objective which is required by the Government Code.

The Comptroller's Office and the State Treasury need to improve the system used to reconcile cash between the Uniform Statewide Accounting System and the Treasury's cash accounting system. The Comptroller and the Treasury had continuing difficulties with the reconciliation process during fiscal year 1994. The Comptroller's Office has coordinated its efforts more closely with the State Treasury in developing an effective reconciliation process.

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