Report 2023-29
The Secretary of State Audits Division annually audits the State of Oregon’s financial statements and compliance with federal program requirements. The federal government requires these audits for the financial assistance Oregon receives every year. These audits determine whether amounts reported in Oregon’s financial statements are materially correct and adequately supported; evaluate the state’s administration of major federal programs for compliance with applicable laws, rules, and regulations; conclude on whether the Schedule of Expenditures of Federal Awards is fairly presented in relation to the state’s financial statements; and review accounting and compliance control procedures.
The results of these audits are included in the
State’s Annual Financial Report and the annual
Statewide Single Audit Report. This report summarizes the fiscal year 2022 audits, which went from July 1, 2021, to June 30, 2022.
Audit of the State of Oregon’s Financial Statements
We issued an unmodified opinion on the state’s financial statements for fiscal year 2022.
We identified $4.6 billion in accounting errors and proposed adjustments to correct them in the financial statements.
We issued six material weaknesses and 11 significant deficiencies in internal control with recommendations to improve standard controls used to ensure the accuracy of financial information.
An unmodified opinion, or a clean opinion, means the financial statements, as corrected, are fairly presented in conformance with Generally Accepted Accounting Principles.
An
error is a mistake in an accounting entry that was not intentional.
A
material weakness is a deficiency that could reasonably lead to a material misstatement.
A
significant deficiency is less severe than a material weakness, yet requires corrective action.
Audits of Compliance with Federal Program Requirements
We audited 17 federal programs at seven agencies and issued 50 findings and recommendations.
The state expended more than $20.8 billion in federal funds, including over $5.6 billion in COVID-related funding.
We questioned whether $9.1 million in known expenditures were appropriately paid with federal funds. Total questioned costs, including projected (likely) expenditures, totaled $35.2 million.
We issued an adverse opinion on the Emergency Rental Assistance program, and a disclaimer of opinion on the Emergency Solutions Grant program. This was the first time in 25 years the division has issued either of these types of modified opinions.
We issued qualified opinions on: the Coronavirus State and Local Fiscal Recovery Fund; Temporary Assistance for Needy Families; Low-Income Home Energy Assistance Program; Block Grants for Community Mental Health Services; and Block Grants for Prevention and Treatment of Substance Abuse programs.
We followed up on 54 findings from the prior three years to see if corrective action had been taken at eight agencies.
Questioned costs refers to costs questioned by the auditor for violation of federal award provisions, or lack of supporting documentation, or because the cost appears unreasonable.
An
adverse opinion means audit procedures have identified pervasive weaknesses in a department or program’s internal controls such that it will not prevent or detect significant noncompliance or financial material misstatements.
A
disclaimer of opinion means there is a lack of sufficient, appropriate audit evidence to support an opinion on financial statements or program compliance.
A
qualified opinion is the type of audit opinion given when audit procedures identify a department or program’s internal controls are inadequate to prevent or detect significant noncompliance or financial material misstatements.
