Baton Rouge, LA: Audit says transportation department computer upgrade caused financial reporting problems

BATON ROUGE, La. (AP) — A multimillion dollar computer upgrade at the state transportation department has been plagued with problems, causing financial statement errors topping $42 million and shortchanging the state of federal reimbursement dollars, according to an audit released Monday.

Louisiana Legislative Auditor Daryl Purpera’s office reviewed the financial systems of the Department of Transportation and Development, which was the first agency to get the computer system upgrade planned for more departments. The study was for the fiscal year that ended in June 2011.

The auditor said the new computer system had coding errors, weaknesses in development and maintenance and other problems that damaged compliance with federal and state financial reporting requirements.

“Failure to properly develop, implement and maintain key system and internal controls could result in untimely and inaccurate financial reporting; noncompliance with federal requirements, which could result in disallowed costs; and a potential loss of federal funds,” the audit says.

The 54-page report says more than $26 million in federal expenses weren’t billed for reimbursement and financial statement errors exceeded $42 million.

Also, monthly reconciliations of cost reports on construction projects weren’t done for three months, making it more likely to have undetected errors, the audit says. The agency didn’t properly report all of its spending of federal stimulus dollars, the review says.

DOTD Secretary Sherri LeBas disagreed with several individual audit findings and defended the computer system upgrade as a huge success, replacing a system at risk to total failure. She said deficiencies identified by the audit have been corrected.

“As with any implementation of this size, there will be improvements made for years to come,” LeBas wrote.

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