Minnesota Office of the Legislative Auditor
Financial Audit Division

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Report Summary
Department of Transportation

Selected Programs
Fiscal Year 1997 Statewide Audit

 

Public Release Date: February 27, 1998 No. 98-11

Agency Background

The Department of Transportation (MnDOT) is responsible to provide a balanced transportation system in Minnesota. The system includes aeronautics, highways, motor carriers, ports, public transit, railroads, and pipelines. The department funds its activities mainly from Trunk Highway Fund appropriations, federal grants, and bond proceeds. Department expenditures for fiscal year 1997 totaled approximately $1.4 billion. James N. Denn is the commissioner of the department.

Selected Audit Areas and Conclusions

Our audit scope included those areas material to the state of Minnesota's Comprehensive Annual Financial Report for the year ended June 30, 1997, and to the Single Audit objectives. It included the Highway Planning and Construction Program (CFDA 20.205), the Airport Improvement Program (CFDA 20.106), County State-Aid Highway Fund grants, Municipal State-Aid-Street Fund grants, and bridge construction.

We found that the Department of Transportation's financial activities for the programs included in the Statewide Audit scope are fairly presented in the state of Minnesota's Comprehensive Annual Financial Report for fiscal year 1997. The department properly processed and recorded state aid and grant payments to counties and municipalities. The department complied with the material financial-related legal provisions for the items tested.

The Department of Transportation properly recorded financial activities in the state's accounting system for the Highway Planning and Construction Program (CFDA 20.205) and the Airport Improvement Program (CFDA 20.106). We and the MnDOT Internal Audit Section noted the following reportable conditions involving internal control over compliance related to the Highway Planning and Construction Program: 1) The department did not enter the correct record date for certain expenditures for federal/county road and bridge projects. 2) The department did not complete supplemental agreements for some construction projects prior to starting the additional work. 3) The department did not properly monitor compliance with the Davis-Bacon Act nor with specification for product material testing.

The Department of Transportation agrees with the findings in this report. The department has indicated that it has taken steps to resolve these issues.

 

Office of the Legislative Auditor ♦ Room 140, 658 Cedar St., St. Paul, MN 55155