The state auditor released another report Thursday relating to Honolulu's $9.2 billion rail project.

This audit focuses on the State Department of Accounting and General Services also known as DAGS.

The Department is responsible for making sure the Honolulu Authority for Rapid Transportation uses the State's  funding as lawmakers intended it to.

According to the state auditor DAGS is incapable of doing the job because it failed to set up administrative rules and it lacks construction knowledge.

The state auditor also says DAGS shortcomings do not affect the overall cost of the project but it does give a false sense of assurance state money is being spent as it should.

The Department of Accounting and General Services responded to the audit late Thursday saying it does have written procedures in place and they've shared them with the auditors and the State Attorney General's office. 

According to DAGS they review invoices for accuracy using a sampling approach claiming it's a generally accepted audit procedure.