Illinois ranked as one of the least financially-transparent states in the nation.
That’s according to a new report from the nonpartisan watchdog organization Truth in Accounting, based on fiscal year 2018 data, the most recent year available.
Illinois was listed as the ninth-worst state in the country, scoring 72 out of 100 possible points. The state was marked down for the late delivery of its annual documents.
“They issued their financial report some 418 days after their fiscal year-end,” said Sheila Weinberg, CEO and founder of Truth In Accounting. “The standard policy for that is 180 days. We're obviously far from that 180-day criteria, and unfortunately, Illinois was the very last state to issue their financial report.”
Weinberg said the consequences of that delay could be far-reaching because decisions in Springfield could have been made without a proper understanding of the state’s financial numbers.
“We really think that it would be very valuable during the budget process for the elected officials to look at the financial condition of the state before they make additional spending and tax policy,” Weinberg said. “But unfortunately this audited financial report was not available during the budget process because it was issued so late.”
The organization measures each state’s Comprehensive Annual Financial Report against a framework of best practices. The scores are based on eight criteria: Accessibility, searchability, if the states used an outside auditor, the auditor’s opinion, timeliness of the report, percentage of off-balance sheet liabilities, pension data timing, and deferred items.
Weinberg said Illinois’ score was further harmed by the failure to have an external auditor look at the numbers.
“We believe that to get accuracy having an independent auditor would be the best situation,” Weinberg said, “instead of having a government official who is paid by the state and has a full-time position from the state actually audit the report.”
The report also dinged the state for showing a distorted net financial position due to misleading and confusing deferred items on its report.
“It means that the citizens in Illinois are not getting a clear picture of their government's true financial condition,” Weinberg said. “And if you don't get a true picture of that, you might make a tax and spending policy that you would not make if you really knew the true financial condition. That is very applicable in Illinois who has a balanced budget clause in their constitution, yet the state finds itself more than $200 billion in the hole.”
Idaho, North Dakota and Nevada ranked at the top of this year’s report, while Connecticut came in at number 50.