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Illinois Department of Human Services Financial Reporting Requirements Have Changed for FY2011

In an effort to reduce the number, variety, and redundancy of financial reports required of community service providers, Illinois Department of Human Services (DHS) has replaced the grant report and consolidated financial report (CFR) with an Annual Financial Report (AFR). 

The AFR is almost identical to the form used to submit program budgets at the beginning of each fiscal year; however, the AFR reports actual numbers.

The DHS FY11 financial reporting checklist includes the due date and specific reporting requirements for your organization. In addition to the new AFR, one of the most significant changes to the FY11 reporting package is that DHS now requires organizations to submit their annual tax filings along with their reporting package. 

A summary of the DHS FY11 reporting requirements follows:

• Providers paid or awarded $300,000 or more under Community Services Agreements with agencies of the state of Illinois, regardless of the types of programs or funds, must submit their audited financial statements.
• Providers that expended $500,000 or more of federal funds from all sources, including funds received through DHS, must submit their OMB Circular A-133 Single Audit report.
• An AFR is required for each DHS-funded program. 
  • The format is similar to the program budgets submitted at the beginning of the fiscal year.
  • AFR will include the actual numbers rather than budgeted numbers.
  • AFR must be prepared for the period July 1, 2010 through June 30, 2011.
  • May require an “In Relation to Opinion" or “Agreed Upon Procedures Report” for each AFR, if required.*
  • Use the AFR template and instructions that are available online: 
    • FY11 Annual Financial Report (AFR) Form (xls) 
    • FY11 Annual Financial Report (AFR) Form Instructions (pdf) 
      NOTE: The instructions for the AFR are labeled “Instructions for the Budgeted Statement of Functional Expenses” but apply to the AFR
• All financial reports are to be submitted in paper copy — references to websites or other electronic documents will not be accepted.
• IRS Form 990, 990T, and AG 990-IL must be submitted with financial reporting package.
• ARRA (Recovery Act) Funds, regardless of the amount received, must be reported separately.
• Reports are due 120 days  after year-end (or 180 days after year-end for organizations that receive $500,000 or more in Federal funds from DHS during the state fiscal year as of May 1)*

*See your DHS FY11 Financial Reporting Checklist for auditor report requirements and due dates.

Due to the volume of calls related to the new reporting requirements, DHS has established the following e-mail address for questions: DHS.DHSOCA@Illinois.gov.

For further information please contact Toni Diprizio, Partner, at tdiprizio@BlackmanKallick.com or 312-980-3227 or your Blackman Kallick representative.

This publication is part of Blackman Kallick’s marketing of professional services, and is not written tax advice directed at the specific facts and circumstances of any person and/or entity. Contents of this publication are of a general nature, and you should not act on this information without obtaining professional advice from your business advisor that is appropriately tailored to your individual needs and circumstances. This written advice is not intended or written to be used, and cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code.