Nebraska's state auditor said the state Department of Labor overspent nearly $7 million in federal money because of accounting errors.

State Auditor Mike Foley said Thursday that the state could be liable to repay the money.

Foley said the department hasn't properly tracked spending in federal grant programs. Previous audits showed errors in the 1990s and then in 2003, but the department said new accounting software fixed the problem.

But Foley said that assurance was false and called the errors a "complete meltdown" in reporting.

Officials with the Nebraska Department of Labor promised to make changes in the way the department manages money.

Nebraska Labor Commissioner Fernando Lecuona III said he believes that most of the shortfall can be covered without any additional state money, but the next month will be crucial.

Lecuona said the department has already cut administrative staff to reduce costs, and other cost-cutting measures are being considered.

Lecuona said in a statement that he would take responsibility for the shortfall because as agency director, he is responsible for his employees' actions.

The Labor Department's executive director of finance, Kay Marti, was fired in March, although she and the department later made an agreement that let her resign.