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3 golden objects Minnesota Legislature

Office of the Legislative Auditor - Financial Audit Division

Report Summary
Department of Employee Relations

Statewide Audit Selected Audit Areas
For the Fiscal Year Ended June 30, 1998


Public Release Date: February 4, 1999 No. 99-7


The Department of Employee Relations (DOER) serves as the central human resource agency, including personnel administration and labor relations, for the executive branch of government. The department manages the State Employee Management (SEMA4) human resource/payroll system in conjunction with the Department of Finance. DOER also operates the insurance and workers' compensation programs for state employees, as well as employee insurance benefit plans for participating public and private employers. Karen Carpenter was appointed department commissioner in October 1997.

Selected Audit Areas and Conclusions

Our audit scope was limited to the financial activities within the Department of Employee Relations that were material to the State of Minnesota's Comprehensive Annual Financial Report for fiscal year ended June 30, 1998. Our scope included statewide payroll expenditures, compensated absence liabilities, revenues and expenses of the State Employees Insurance Fund, the Public Employees Insurance Program (PEIP), and the Minnesota Employees Insurance Program (MEIP), and workers' compensation.

We qualified our report, dated December 1, 1998, on the State of Minnesota's Comprehensive Annual Financial Report because insufficient audit evidence exists to support the State of Minnesota's disclosures with respect to the year 2000. Auditing the state's year 2000 compliance efforts was not an objective of this audit. As a result, we do not provide assurance that the Department of Employee Relations is or will be year 2000 ready, that its year 2000 remediation efforts will be successful in whole or in part, or that parties with which the Department of Employee Relations does business will be year 2000 ready.

For the areas audited, the Department of Employee Relations' financial activities were fairly presented in the State of Minnesota's general purpose financial statements for the year ended June 30, 1998. As a result of our procedures, we identified one issue at the Department of Employee Relations involving the reporting of investment balances and activities in accordance with generally accepted accounting principles (GAAP).

The department agreed with the audit report finding and recommendation. They plan to familiarize accounting staff with the necessary financial reporting requirements for investments.

More Information

Office of the Legislative Auditor, Room 140, 658 Cedar St., St. Paul, MN 55155 : or 651‑296‑4708