Audit 309493

Criteria:To obtain benefits from the Organization’s Low-Income Home Energy Assistance Program (LIHEAP), clients are required by policy to schedule an appointment and come into the office and complete an application. Clients who are unable to come to the office can complete a form authorizing another person to act on their behalf. Condition: A relative of the LIHEAP Manager of the Organization received benefits that helped to pay utility bills without following the policies and procedures of the Organization’s LIHEAP program. Specifically, the relative was not required to make an appointment and come into the office to file for benefits as is required by policy. Additionally, the client’s file did not contain the Organization’s form authorizing another party to act on their behalf. The signatures on the two case files in question were dated June 28, 2024 and December 18, 2024, and did not appear to match the signatures on the same client’s application when there was evidence that the person came into the office to complete the application for a separate case in 2024. Cause: Lack of internal controls over clients that are relatives of employees. LIHEAP applications were not required to be approved by a management level employee and the LIHEAP Manager had her subordinates approve the applications for relatives. In addition, there is no disclosure for an employee’s relatives as part of the application and intake process. Effect: A relative of the LIHEAP Manager may have received preferential treatment when applying for assistance. Questioned Cost: $1,050. Other Information: Two of seventy files tested were for a relative that did not have evidence of following the Organization’s policies and procedures for completing applications for assistance. Ten of the seventy clients tested were identified as family members of employees. The Executive Director of the Organization notified the Legislative Auditor and the local District attorney of the matter on June 10, 2024. No investigation has started, and no adjudication has taken place as of the date of this report. The LIHEAP manager is currently on administrative leave and restitution has not been made as of the date of this report. Recommendation:Clients should be required to complete a disclosure that identifies any relationship between them and any employee of the Organization. Additionally, clients that are relatives should have their application approved by a management level employee or supervisor of that employee. A subordinate should not be allowed to approve an application for a relative of their supervisor. Reply: Management agrees with this finding and will implement policies and procedures for identifying family members of relatives that apply for benefits and for approving their applications.

LIHEAP Agency Invoice Reports maintained by the Organization should have sufficient supporting documentation that reports the details of the weekly benefits paid to clients. Condition: LIHEAP Agency Invoice Reports maintained by the Organization did not contain sufficient supporting documentation to agree the details of the weekly benefits paid to the weekly summary report of benefits paid. Cause: Supporting documentation was misplaced or misfiled. In addition, one weekly report was not documented as reviewed and approved. Effect: Reports submitted may contain errors. Questioned Costs: None Other Information: Management should ensure all weekly LIHEAP Agency Invoice Reports are reviewed for completeness and correctness and marked as approved prior to filing. All copies maintained should be complete. Recommendation: Management should ensure all weekly LIHEAP Agency Invoice Reports are reviewed for completeness and correctness and marked as approved prior to filing. All copies maintained should be complete. Reply: Management agrees with this finding and will develop stronger policies and procedures to ensure sufficient supporting documentation is maintained for each weekly LIHEAP Agency Invoice Report.

Criteria:All clients’ applications for assistance should be approved by an appropriate independent party. Condition: Clients that are relatives of employees are not required to be approved by a management level employee or a supervisor of the employee and on occasion are approved by the employees’ subordinates. Cause: Lack of polices and procedures over clients that are relatives of employees. Effect: Clients that are relatives of employees may have received preferential treatment. Recommendation: Clients that are relatives of employees should have their applications approved by a supervisor that is at least a management level employee. As part of the application and intake process clients should complete a disclosure to report any relatives that are employed by the agency and their relationship. Reply: Management agrees with this finding and will develop policies and procedures for identifying family members of relatives that apply for benefits and for approving their applications.

Criteria:The LIHEAP Agency Invoice Reports are used to monitor the cash management of the LIHEAP grant and should have verification that the reports are reviewed and approved prior to submission. Condition:There was no verification of the approval on the LIHEAP Agency Invoice Reports. Cause: Lack of oversight in monitoring the LIHEAP Agency Invoice Reports.Effect: Reports submitted could contain errors if not properly reviewed. Questioned Costs:None Other Information: Four of nine reports tested were not approved. Recommendation: Management should document the approval process by having the reviewer sign each weekly report. Reply: Management agrees that the LIHEAP Agency Invoice Reports did not contain documentation of approval and will review its approval process to ensure all future reports are reviewed and marked as approved.

Criteria:To obtain benefits from the Organization’s Low-Income Home Energy Assistance Program (LIHEAP), clients are required by policy to schedule an appointment and come into the office and complete an application. Clients who are unable to come to the office can complete a form authorizing another person to act on their behalf. Condition: A relative of the LIHEAP Manager of the Organization received benefits that helped to pay utility bills without following the policies and procedures of the Organization’s LIHEAP program. Specifically, the relative was not required to make an appointment and come into the office to file for benefits as is required by policy. Additionally, the client’s file did not contain the Organization’s form authorizing another party to act on their behalf. The signatures on the two case files in question were dated June 28, 2024 and December 18, 2024, and did not appear to match the signatures on the same client’s application when there was evidence that the person came into the office to complete the application for a separate case in 2024. Cause: Lack of internal controls over clients that are relatives of employees. LIHEAP applications were not required to be approved by a management level employee and the LIHEAP Manager had her subordinates approve the applications for relatives. In addition, there is no disclosure for an employee’s relatives as part of the application and intake process. Effect: A relative of the LIHEAP Manager may have received preferential treatment when applying for assistance. Questioned Cost: $1,050. Other Information: Two of seventy files tested were for a relative that did not have evidence of following the Organization’s policies and procedures for completing applications for assistance. Ten of the seventy clients tested were identified as family members of employees. The Executive Director of the Organization notified the Legislative Auditor and the local District attorney of the matter on June 10, 2024. No investigation has started, and no adjudication has taken place as of the date of this report. The LIHEAP manager is currently on administrative leave and restitution has not been made as of the date of this report. Recommendation:Clients should be required to complete a disclosure that identifies any relationship between them and any employee of the Organization. Additionally, clients that are relatives should have their application approved by a management level employee or supervisor of that employee. A subordinate should not be allowed to approve an application for a relative of their supervisor. Reply: Management agrees with this finding and will implement policies and procedures for identifying family members of relatives that apply for benefits and for approving their applications.

LIHEAP Agency Invoice Reports maintained by the Organization should have sufficient supporting documentation that reports the details of the weekly benefits paid to clients. Condition: LIHEAP Agency Invoice Reports maintained by the Organization did not contain sufficient supporting documentation to agree the details of the weekly benefits paid to the weekly summary report of benefits paid. Cause: Supporting documentation was misplaced or misfiled. In addition, one weekly report was not documented as reviewed and approved. Effect: Reports submitted may contain errors. Questioned Costs: None Other Information: Management should ensure all weekly LIHEAP Agency Invoice Reports are reviewed for completeness and correctness and marked as approved prior to filing. All copies maintained should be complete. Recommendation: Management should ensure all weekly LIHEAP Agency Invoice Reports are reviewed for completeness and correctness and marked as approved prior to filing. All copies maintained should be complete. Reply: Management agrees with this finding and will develop stronger policies and procedures to ensure sufficient supporting documentation is maintained for each weekly LIHEAP Agency Invoice Report.

Criteria:All clients’ applications for assistance should be approved by an appropriate independent party. Condition: Clients that are relatives of employees are not required to be approved by a management level employee or a supervisor of the employee and on occasion are approved by the employees’ subordinates. Cause: Lack of polices and procedures over clients that are relatives of employees. Effect: Clients that are relatives of employees may have received preferential treatment. Recommendation: Clients that are relatives of employees should have their applications approved by a supervisor that is at least a management level employee. As part of the application and intake process clients should complete a disclosure to report any relatives that are employed by the agency and their relationship. Reply: Management agrees with this finding and will develop policies and procedures for identifying family members of relatives that apply for benefits and for approving their applications.

Criteria:The LIHEAP Agency Invoice Reports are used to monitor the cash management of the LIHEAP grant and should have verification that the reports are reviewed and approved prior to submission. Condition:There was no verification of the approval on the LIHEAP Agency Invoice Reports. Cause: Lack of oversight in monitoring the LIHEAP Agency Invoice Reports.Effect: Reports submitted could contain errors if not properly reviewed. Questioned Costs:None Other Information: Four of nine reports tested were not approved. Recommendation: Management should document the approval process by having the reviewer sign each weekly report. Reply: Management agrees that the LIHEAP Agency Invoice Reports did not contain documentation of approval and will review its approval process to ensure all future reports are reviewed and marked as approved.