Office of the Legislative Auditor - Financial Audit Division

Report Summary

Management Letter

Department of Labor and Industry

Fiscal Year Ended June 30, 2000

Key Finding and Recommendation:

• The Department of Labor and Industry did not properly calculate the general long-term obligation for injured workers of uninsured or bankrupt employers. We found that the department overstated the liability due to historical data that had not been properly updated in its computerized system. We also noted inconsistent use of the computerized system by department claims managers. Recommendations were made to develop consistent practices and to consider training for claims managers.

Management letters address internal control weaknesses and noncompliance issues found during our annual audit of the state's financial statements and federally-funded programs. The scope of work in individual agencies is limited. During the fiscal year 2000 audit, our work at the Department of Labor and Industry focused on financial activities of the Special Workers' Compensation Fund and the Occupational and Safety Health Act (OSHA) federal program administered by the department.