Office of the Legislative Auditor - Financial Audit Division

Report Summary
Department of Employment and Economic Development
and the
Minnesota Opportunities Industrialization Centers State Council Special Review

 

Financial Audit Division Report 11-01

Released January 13, 2011

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Conclusion

The Minnesota Opportunities Industrialization Centers State Council is a private, nonprofit organization that receives state grant funds through the Department of Employment and Economic Development. The council is the state level affiliate of a national organization whose mission is to provide education, training, employment, and housing services to economically disadvantaged people of all races and backgrounds. We undertook this special review because of concerns raised during an audit of the Department of Employment and Economic Development that examined grants the department made to a wide variety of organizations, including nonprofit organizations. That report concluded that the department needed to improve its oversight of grant recipients to ensure that they complied with applicable legal provisions, including laws, state policies, and grant agreements.

Our review covered the time period from July 1, 2007, through June 30, 2010, and included a review of how the State Council spent state grant funds it received through the Department of Employment and Economic Development.

Findings

• The State Council did not have adequate internal controls to ensure that it used state grant funds in compliance with state law and grant agreements with the Department of Employment and Economic Development.
• The State Council was unable to show that approximately $20,000 of its costs were appropriate uses of state grant funds.
• The Department of Employment and Economic Development provided “in kind” assistance to the State Council beyond the amount of support authorized in state law.