Report of State Auditor 1999

• Year: 1999
• Title: Report of the State Auditor
• CWCB Section: Finance
• Description: Evalation of Actions Taken on the 1998 Colorado Water Conservation Board Construction Fund Loan Program as of December 1999
• Publications - Doc Type: Tech Report

Report of The Colorado State Auditor 29
Implementation date: June 1999.
Water Conservation Board's Update (October 1999):
In progress. The CWCB staff continues to work with the Attorney General's Office, the
State Controller's Office, and the Department's Accounting Section in the preparation of a
standard construction fund loan contract. The two-phase contracting approach suggested by
the auditor has been discounted by the above state agencies as too cumbersome and time
consuming. The residual funds issue was addressed in our response to Recommendation
No. 5.
Office of the State Auditor's Evaluation of Actions Taken
(December 1999):
In progress. In response to our audit, the CWCB developed a standardized contract for
corporate(i.e.,agricultural)users. According to CWCB staff,the contract has been reviewed
' and approved by the Attorney General's Office. Currently it is in the process of being
reviewed by the Department's Accounting Section,and upon its approval,the contract draft
will be submitted to the State Controller's Office for approval and for signature authority
waiver. Once this occurs, the CWCB will be able to use the standardized contract to
streamline its dealings with ditch and reservoir users. The CWCB's goal is to shorten
' contract processing time by two to four weeks.
The CWCB has also developed a database that tracks and reports on the status of all loans.
' According to CWCB staff,this system is used to monitor contracts to ensure they have been
amended when necessary and that any residual funding has been deauthorized in a timely
manner. Finally, CWCB staff have discussed the two-phase contracting process with the
' Department's Accounting Section and the Attorney General's Office and concluded that it
is not practical to pursue at this time.
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Improve Accounting Procedures and Internal Controls
' During the 1998 audit,we identified a number of weaknesses in the CWCB's accounting procedures
and internal controls,including its management of payment vouchers,cash receipt controls,and loan
balance information. For example,we reviewed 187 loan balances maintained in the Board's loan
files and found that 40 did not match the balances in the Department's accounting records. We also
found that nearly one-third of the balances maintained in borrowers' records did not match the
' accounting records.
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