Legislative auditor flags late audits, control weaknesses and public‑assistance problems; recommends referrals to budget committees

At the Jan. 29, 2025 meeting of the Legislative Budget and Audit Committee, Legislative Auditor Chris Curtis briefed members on the office’s top audit issues from fiscal 2024 and recommended that several items be referred to the Legislature’s budget subcommittees for continued oversight.

Curtis told the committee that the Division of Legislative Audit is the state’s independent auditor and that the annual financial and federal audits consume the majority of the division’s resources. “The financial and federal audit is our big project, and it takes about 75% to 80 percent of our annual audit hours,” Curtis said.

Nut graf: The briefing identified specific, recurring problems that affect the timeliness and completeness of the state’s audited financial statements and federal compliance reporting — matters the auditor recommended be forwarded to relevant budget or policy committees so they can consider follow-up during the budget process.

Key issues and recommendations presented to the committee:

- Airport financial statements: The auditor reported a disclaimed or late opinion for some international airport financial statements for FY22 and FY23 because required audit information was not produced in a timely way. Curtis recommended referring this matter to the Department of Transportation budget and finance subcommittees for oversight during the budget process.

- Aerospace Corporation: The item was reported as resolved; no further action recommended.

- National Guard and Naval Militia Retirement System: Curtis reported a late audit and a disclaimed opinion tied to the outside auditor’s inability to obtain actuarial information; he did not recommend immediate referral because legislative audit will continue to review the matter as part of the annual financial audit.

- Financial statement errors: A set of errors discovered during FY23 testing were noted; legislative audit will continue to monitor these as part of the FY24 single audit and no referral was recommended at this time.

- Division of Public Assistance (Department of Health): Curtis highlighted ongoing material weaknesses and federal audit findings in the Division of Public Assistance and recommended forwarding those findings to the Department of Health budget subcommittees as well as the House and Senate finance committees for consideration during the budget process. Representative Foster commented, “In my 15 years here I've never seen it so bad,” reflecting constituent contacts about delayed assistance.

- Shortfalls in departmental authorizations: Legislative audit identified three departments that were routinely not addressing apparent shortfalls in their general fund authorizations — the Department of Law, Department of Natural Resources, and Department of Health — and recommended the committee send these findings to the respective budget subcommittees.

- Alcohol and Marijuana licensing delays (AMCO): The auditor reported repeated licensing delays at the Alcohol and Marijuana Control Office and said a new licensing system implementation is expected to address many of the issues. Curtis recommended referring the item to the Labor and Commerce committees for their awareness or further oversight regarding system implementation status.

- Technical Vocational Education Program (TVEP) underpayments: A prior performance audit identified underpayments to seven TVEP beneficiaries in FY22; Curtis reported work with the Office of Management and Budget (OMB) to resolve those underpayments and did not recommend additional committee follow-up based on the agency’s reported corrective actions.

Curtis explained the committee’s adopted audit-finding oversight process: legislative audit identifies top issues, queries affected agencies for corrective-action status, and then the committee determines whether to refer issues to other legislative committees for continued monitoring. Curtis said he will work with the chair to draft letters to the appropriate standing and budget subcommittees describing the recommended referrals; Representative Josephson confirmed that the committee chair will send the letters after the auditor and chair craft them.

No formal votes were taken on the referral recommendations during the meeting; the item was listed as discussion only.