West Virginia lawmakers sitting on the Post Audits Subcommittee heard a presentation on the audit at an interim legislative session meeting Sunday.
The audit for the year ending June 30 by Charleston-based accounting firm Suttle & Stalnaker found that the DOH, an agency within the Department of Transportation:
* Couldn't provide a complete record of all the land it owns.
* Risked unauthorized access to critical information systems.
* Allowed inaccuracies in recording year-end accruals that resulted in adjustments to financial statements.
* Failed to capitalize $64 million of construction in progress in prior-year financial statements, resulting in prior-year capital assets being understated and expenses being overstated by that amount.
As it's done with past audits, the DOT agreed with the findings and pledged to take necessary corrective actions.
The failure to provide a complete record of land it owns has been a problem identified by past audits.
DOT pledges to finish real estate records update
Speaking before the subcommittee, DOT Business Manager Carla Rotsch alluded to a DOH response to a Suttle & Stalnaker's previous-year audit in which Rotsch said it would take roughly two years to finish a project to address its incomplete record of real estate owned by the DOH.
The project has included sending correspondence to all districts requesting updated information for property acquisitions since October 2020 after the COVID pandemic halted an agency compilation process and updating a resource planning system with the information.
Rotsch said the agency had made "some substantial efforts" to address the audit finding and has planned a new system to "have all this buttoned up" in the current fiscal year.
House of Delegates Speaker Roger Hanshaw, R-Clay, told Rotsch lawmakers are interested in ownership of freestanding parcels more than rights-of-way.
In another finding carried over from past audits, Suttle & Stalnaker found the DOH hasn't monitored information system controls, with terminated employees not removed from or communicated to state Office of Technology administrators or information systems used by the agency in timely fashion.
Programmers have access to programs in information systems that allow them the same rights as business users and access to data and transactional authority, the audit found.
The audit recommended the DOH establish procedures to create a documented, periodic review of user account management, implement a process to review system administrator activity for division-owned applications and remove programmer access from production applications.
DOH recordkeeping inaccuracies resulted in audit adjustments decreasing the unit's net position by $11.1 million and decreasing its fund balance by $15.1 million, Suttle & Stalnaker reported, prompting a recommendation that management review daily accounting functions to ensure accurate financial reporting.
DOT Secretary and DOH Commissioner Jimmy Wriston underscored how much funding the agency is responsible for at another state lawmaker panel meeting Tuesday. Wriston told the Joint Legislative Oversight Commission on DOT Accountability his agency exceeded $1 billion in contracts let this year, with $4 billion in active construction projects and just under $1 billion in active engineering consultant contracts.
The audit found the DOH's governmental funds had decreased $90 million compared with the prior year, resulting in a combined total fund balance of $1.6 billion.
Federal aid comprised roughly 39% of DOH revenues, by far the largest slice of that pie.
© 2023 The Charleston Gazette (Charleston, W.Va.). Distributed by Tribune Content Agency, LLC.
