“How are we able to effectively deal with our budget situation if we don’t know where we stand financially?” – Senator Linda Holmes

AURORA, IL – Illinois’ financial reporting process is antiquated and costly, according to the Auditor General. That’s a big problem for a state that’s billions in the red.

“How are we able to effectively deal with our budget situation if we don’t know where we stand financially?” Senator Linda Holmes (D – Aurora) said.

To address the problem, State Senator Linda Holmes created the Financial Reporting Standards Board, which will work with state agencies to improve the state’s overall financial reporting process.

Illinois’ outdated reporting systems have resulted in untimely financial reporting of the true financial position of the State, negatively affecting the State’s bond rating and jeopardizing federal funding opportunities.

“Using a system that is outdated and untimely gives us an inaccurate portrait of our current fiscal situation,” Holmes added. “Anyone who has ever created a budget knows up to date information is key when making any kind of financial decision.”

Working with the Comptroller’s Division of Financial Reporting, the board will assist state agencies by establishing minimum qualifications, training and continuing education requirements, and best practice guidelines for generally accepted auditing practices (GAAP) coordinators at state agencies. The Comptroller’s office will also assist state agencies when preparing the Comprehensive Annual Financial Report that is required by state law.

“I am confident the modernization and streamlining of our financial reporting systems will allow us to better prepare a long-term financial plan for Illinois,” Holmes continued.

Senate Bill 3794 was signed by the governor today and will take effect January 1, 2013.

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