The information on the Department's follow-up on audit recommendations covers 2005. It includes information on the status of recommendations more than one year old without fi nal management decisions, and the dollar value of those reports in which funds could be put to better use or costs could be disallowed.

During 2005, the Department of State tracked 19 audit reports that were more than one year old and included a total of 60 recommendations in which final action was not taken, which would have brought closure to the reports. These audits contain over $2,070,718 in disallowed costs and funds put to better use. The Department is working to bring closure to the 19 audits and recognizes that the follow-up actions and compliance to the recommendations are essential to improving the effectiveness and efficiency of program operations.

Management Statistical Summary
19 Audits Over One Year Old Requiring Final Action

Program Area	Number of Audit Reports	Recommendations
Financial Management	11	44
Information Management	1	6
Security Oversight	-	-
Support Programs	-	-
Property Management and Procurement	2	5
Contracts and Grants	5	5
TOTALS	19	60

Status of Audits with Recommendations that Funds Be Put to Better Use or Costs be Disallowed

On October 1, 2004, there were no audits with recommendations to put funds to better use. One audit was completed during the year with disallowed costs of $1,800,000. The balance on September 30, 2005 was $1,800,000.

Status of Audits of Disallowed Costs

On October 1, 2004, there was one audit with management decision on which final action had not been taken with a dollar value of disallowed costs totaling $110,851. During the year, two audits were completed that included disallowed costs of $159,867. Therefore, the resulting balance on September 30, 2005 was $270,718.

Funds Put to Better Use and Disallowed Costs in Audit Reports

	Number of Audit Reports Identifying Amount of Funds Put to Better Use	Amount of Funds Put to Better Use	Number of Audit Reports Identifying Disallowed Costs	Disallowed Costs
Beginning Balance	-	-	1	$110,851
New Audits	1	$1,800,000	2	159,867
Implemented Actions	-	-	-	-
Ending Balance	1	$1,800,000	3	$270,718

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