Legislative auditors tell JFAC many findings are recent; some long‑running issues persist

April Renfro, legislative audits, Legislative Services Office, told the Joint Finance and Appropriation Committee on Jan. 7 that the office performs a range of audits—annual state financial statements, single audits of federal awards and recurring accountability reports—and that the committee’s co‑chairs have delegated authority under Idaho Code 67435 to release audit reports.

Renfro said the office issues an annual report of uncorrected findings so legislators can see which agencies have open items and how long those findings have remained outstanding. “Seventy percent of our uncorrected findings are from the current reporting period,” she said, adding that the remaining 30 percent have remained open longer than a year and may require additional follow‑up.

The auditors described three common categories of findings: internal control weaknesses, noncompliance with statutes or rules, and substantive financial errors. Renfro said internal‑control findings often reflect missing policies, insufficient training, or weak documentation that raises the risk of error even when a specific mistake has not yet been identified.

Renfro used specific examples to illustrate risk and persistence. For the Department of Fish and Game, an older, partially corrected finding concerned noncompliance with state travel policy and missing travel documentation; after an organizational transition to a new system called LUMA, auditors could not verify corrections and the finding reverted to “uncorrected.” For the Department of Health and Welfare, auditors reported numerous problems in the 2023 accountability report tied to qualified residential treatment program placements for youth: missing assessments, absent court orders or notices, placement timing outside required windows and missing case consultations. Renfro said those deficiencies—some quantitative, some qualitative—leave foster children at risk of not receiving appropriate or timely care.

Auditors also described systemic risks tied to information systems. As an example from the single audit, auditors found that updates to the Low Income Home Energy Assistance Program benefits matrix lacked documented review and approval; while no payment errors were found in the sample, the absence of documented review increases the risk that incorrect rates could be applied.

Committee members asked why some findings remain uncorrected for multiple years. Renfro said causes vary: some programs receive funds or make reports only periodically, which slows follow‑up; others require legislative changes, systems updates, or time‑intensive training. She said the auditors use a staged follow‑up process—90‑day, first annual and second annual visits—to test whether corrective actions were taken and whether those actions resolved the deficiency.

Renfro warned that consequences can range from internal control improvements to criminal investigations in rare cases. Committee members and co‑chairs discussed enforcement options, including withholding funding when agencies decline to accept corrective action recommendations.

The office also warned the committee that delays in receiving the state’s financial statements—caused this year in part by late agency and system submissions tied to LUMA—will likely push the audit opinion and the single audit past statutory deadlines. Renfro said the office is communicating with federal cognizant agencies and expects the delay to affect the timing of single‑audit issuance, though she had not yet identified credit‑rating impacts.

The auditors said they will distribute the uncorrected findings report to committee members the same day and noted their strategic plan authorizes work on local government audits as requested by the Committee on Uniform Accounting and Transparency.

The presentation prompted committee discussion about the role of audit findings in budget decisions and the duty of members in work groups to consider outstanding findings when reviewing agency budgets. The committee co‑chairs encouraged members to use the legislative budget website and the new audits tab to locate open findings tied to agencies they oversee.