Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-003Prior Year Finding:2021-007Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 - Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:EligibilityType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Regular Unemployment Compensation (UC) Program ? Under state UC laws, a worker?s benefit rights depend on the amount of the worker?s wages and/or weeks of work in covered employment in a ?base period.? While most states define the base period as the first four of the last five completed calendar quarters prior to the filing of the claim, other base periods may be used. To qualify for benefits, a claimant must have earned a certain amount of wages or have worked a certain number of weeks or calendar quarters within the base period or meet some combination of wage and employment requirements. Some states require a waiting period of one week of total or partial unemployment before UC is payable. A ?waiting period? is a non-compensable period of unemployment in which the worker is otherwise eligible for benefits. To be eligible to receive UC, all states provide that a claimant must have been separated from suitable work for non-disqualifying reasons under state law (i.e., not because of such acts as leaving voluntarily without good cause or discharge for misconduct connected with work). After separation, he or she must be able and available for work, actively seeking work, legally authorized to work in the United States and must not have refused an offer of suitable work.Pandemic Unemployment Assistance (PUA) ? PUA provides benefits to covered individuals, who are those individuals not eligible for regular unemployment compensation (UC or extended benefits under state or federal law or Pandemic Emergency Unemployment Compensation (PEUC), including those who have exhausted all rights to such benefits. Covered individuals also include self-employed, those seeking part-time employment, individuals lacking sufficient work history, and those who otherwise do not qualify for regular unemployment compensation or extended benefits under state or federal law or PEUC.PUA is payable to individuals who are ineligible for regular UC, and are unemployed, partially unemployed, or unable or unavailable to work due to one of the COVID-19 related reasons identified Attachment I to UIPL No. 16-20, Change 5. Section 2102(a)(3)(A)(ii)(I) of the CARES Act included 10 specific COVID-19 related reasons. The Department, under the authority provided by Section 2102(a)(3)(A)(ii)(I)(kk) of the CARES Act, has added additional COVID-19 related reasons; these are discussed in more detail in Section 4.a. of UIPL No. 16-20, Change 5. While three of these new COVID-19 related reasons were introduced to states with the publication of UIPL No. 16-20, Change 5 on February 25, 2021, all COVID-19 related reasons apply retroactively to the beginning of the PUA program.Additionally, as described in Section 4.b.i. of UIPL No. 16-20, Change 5, paraphrasing of the COVID-19 related reasons is not permissible; individuals must be permitted to select more than one COVID-19 related reason; individuals must be permitted to select different COVID-19 related reasons each week; and individuals must be permitted to file and select no COVID-19 related reasons.Federal Pandemic Unemployment Compensation (FPUC) ? To be eligible for FPUC during the program dates described in Section 8 above, individuals must be eligible to receive at least $1 of underlying benefits for the week in question (including regular UC, UCFE, UCX, PEUC, PUA, EB, STC, TRA, DUA, and SEA). FPUC does not require the individual to submit a separate initial application or continued claim.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:CLA noted that ineligible claimants were being paid unemployment insurance. The Department of Labor and Workforce Development (DLWD) did not maintain an effective control environment over eligibility requirements of the New Jersey Local Office Online Payment System (NJLOOPS) for both FPUC and PUA.Context:Sixty claimants were selected for testing which included 24 claimants for Regular UC and Extended Benefits, 25 claimants for FPUC and 11 claimants for PUA. We noted the following exceptions:? FPUC: 2 of 25 claimants receiving benefits did not receive at least $1 of other benefits for the payment period.? PUA: 4 of 11 claimants receiving PUA did not identify a COVID-19 reason for their unemployment and were ineligible for the program.Questioned costs:$2,320 - The total amount of benefits received by ineligible recipients:? FPUC: $600? PUA: $1,720Cause:The Department began providing benefits to claimants before NJLOOPS had completed the eligibility determination process.Effect:Ineligible claimants received unemployment compensation benefits.Recommendation:We recommend the Department review and enhance procedures and controls to ensure that only eligible claimants receive unemployment compensation benefits.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) has controls in place to only allow an FPUC payment to be made when an underlying Unemployment Insurance (UI) payment has also been processed. FPUC payments should not be issued to any claim without the underlying UI payment being made for the same week. The two FPUC payments issued and noted as exceptions during eligibility testing will be reviewed independently by DLWD to determine if the payments issued were to eligible recipients or not.For the PUA exceptions noted during Eligibility testing, overall the DLWD issued PUA payments to over 680,000 claimants during the COVID-19 pandemic. DLWD had controls in place to require a COVID related reason to make the claim PUA eligible and the weekly PUA certification required claimants to choose a COVID related reason for why they were out of work before they could get paid. The PUA payments in question will be reviewed independently by the DLWD to determine if the payments issued under PUA were appropriate or if they should have been paid instead under the regular UI program.
Reference Number:2022-004Prior Year Finding:2021-010Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Reporting ? ETA 9050 and ETA 9052Type of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: The ETA 9050 ? Time Lapse of All First Payments except Workshare report contains monthly information on first payment time lapse. This report concerns the time it takes states to pay benefits to claimants for the first compensable week of unemployment. First Payments are considered timely at 14/21 days, Interstate and Intrastate UI, UCFE, and UCX, full and partial weeks. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.The ETA 9052 ? Nonmonetary Determination Time Lapse Detection report contains monthly information on the time it take states to issue nonmonetary determinations from the date the issues are first detected by the agency. Single-claimant and multi-claimant nonmonetary determinations are included in the report. Nonmonetary determinations made by organizational units such as Benefits Accuracy Measurement (BAM) and Benefit Payment Control (BPC) are also included in the report. Nonmonetary determinations are considered timely if completed within 21 days. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Reports submitted by the Department of Labor and Workforce Development (Department) indicate that First Payment Time Lapse and Nonmonetary Determinations were untimely during FY 2022.Context:Four ETA 9050 and four ETA 9052 reports were selected for testing for the months of September 2021, November 2021, February 2022, and May 2022. We noted the following exceptions:? ETA 9050: 4 of 4 reports indicate that First Payments were made in more than 14/21 days.? ETA 9052: 4 of 4 reports indicate that nonmonetary determinations were completed in more than 21 days.Questioned costs:None noted.Cause:The Department?s procedures and controls were not operating effectively to ensure that first payments and nonmonetary determinations were completed timely.Effect:First Payments and Nonmonetary Determinations were not completed timely as required by the program.Recommendation:We recommend that the Department review its policies and procedures to ensure that it makes first payments within 14/21 days and that nonmonetary determinations are completed within 21 days per program requirements.Views of responsible officials:New Jersey continues to make progress towards meeting the first payment and non-monetary time lapse standards as recovery from the historic claims filing related to the COVID-19 pandemic continues. As indicated in the prior year update, time lapse standards for both first payment and non-monetary continue to increase from the lows seen during the pandemic. Most recent figures for February 2023 show first payment time lapse at 65.1% and year-to-date at 54.5%, both up from what was reported last November 2022 at 40% and 36.4%, respectively. Non-monetary time lapse figures have also improved, with the most recent February 2023 figures reported as 62.6% for the month and 44.1% year-to-date, which is up from 24.0% for March 2022 and year-to-date at that time of 33.0%).It is important to note that before the pandemic hit in March 2020, New Jersey current figures at that time met all first payment and non-monetary time lapse standards for the reporting year that ended March 2020. The decrease to the timeliness figures is a direct result of the significant increase to workload volumes resulting from the pandemic and not due to a lack of proper internal controls.In addition to the high workloads, New Jersey has also implemented strict anti-fraud measures that include all new claims filed going through an identity proofing process before any payments can be issued. Delays on the claimant end to complete the verification process ? either by the claimant not going through the process or having difficulty with completing it ? also will have a direct impact on first payment time lapse. Increased education to claimants on the requirement to verify their ID, as well as increasing the tools and greater availability of support for ID verification will provide claimants with more options to meet this requirement. New Jersey has worked with our identity verification partner to allow for three different methods of verification; 1) self-service online, 2) connect to a `Trusted Referee? with our identity verification partner who will provide the verification online through a video call, or 3) an in-person appointment at a walk-in center to complete the process. In addition to what is offered by the vendor, One Stop centers throughout the State have been equipped with upgraded monitors with cameras that will allow claimants that are unable to complete the process with our vendor to report to one of these centers and complete the process there.As New Jersey continues to work through the backlog of claims, it is anticipated that overall time lapse figures will continue to improve and for the reporting year ending March 2024 progress will be made towards meeting the established standards.
Reference Number:2022-005Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Special Tests and Provisions: UI Reemployment Programs: RESEAType of Finding:Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 42 U.S. Code ? 506 (a) The Secretary of Labor (in this section referred to as the ?Secretary?) shall award grants under this section for a fiscal year to eligible States to conduct a program of reemployment services and eligibility assessments for individuals referred to reemployment services as described in section 503(j) of this title for weeks in such fiscal year for which such individuals receive unemployment compensation. Further, per 42 U.S. Code ? 506 (c) (1), In carrying out a State program of reemployment services and eligibility assessments using grant funds awarded to the State under this section, a State shall use such funds only for interventions demonstrated to reduce the number of weeks for which program participants receive unemployment compensation by improving employment outcomes for program participants.The UI program serves as one of the principal ?gateways? to the workforce system. It is often the first workforce program accessed by individuals who need workforce services. The WPRS and RESEA programs serve as UI?s primary programs that facilitate the reemployment needs of UI claimants.WPRS, which is mandated by Section 303(j) of the Social Security Act, is designed to identify UI claimants who are most likely to exhaust their benefits and need reemployment assistance to return to work, and refer them to appropriate reemployment services, such as: job search and job placement assistance; counseling; testing; provision of occupational and labor market information; and assessments. WPRS provides reemployment services to selected claimants through an early intervention process. The number of individuals served under WPRS is determined by the state (and/or local areas) based on its capacity to serve these individuals. UIPL No. 41-94 provides guidance on WPRS requirements.RESEA is authorized by Section 306 of the Social Security Act and builds on the success of RESEA?s predecessor, the former UI Reemployment and Eligibility Assessment (REA) program. RESEA uses an evidence-based integrated approach that combines an eligibility assessment for continuing UI eligibility and the provision of reemployment services. State administration of the RESEA is voluntary and under certain circumstances may be designed to also satisfy WPRS requirements. Operating guidance for the RESEA program is updated annually. UIPL 13-21 provides RESEA operating Guidance for FY 2021.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor (Department) did not retain documentation required by the RESEA program to verify compliance with federal program regulations. Controls were not working sufficiently to document that a staff member at the Department with knowledge of the program reviewed eligibility requirements prior to admission of participants to the RESEA program.Context:The Department?s policy is that RESEA eligibility interviews must be conducted and eligibility review forms completed. Both steps are to be reviewed and signed by the participant and an Unemployment Insurance (UI) staff member who is knowledgeable of the program requirements. For three of sixty cases selected for testing, the Department was unable to provide a signed RESEA worksheet indicating the interview had been completed and the claimant was reviewed and approved by a UI supervisor.Questioned costs:Undetermined.Cause:The Department?s procedures and internal controls are not sufficient to ensure compliance with RESEA requirements.Effect:Without clear documentation supporting a participant?s eligibility and supervisory review, ineligible participants could go undetected and federal funds could be paid to recipients who do not qualify to participate in the RESEA program.Recommendation:We recommend that policies and procedures be implemented to ensure that internal controls over RESEA include retention of documentation of each participant?s eligibility and review and approval by a UI supervisor.Views of responsible officials:The RESEA policy and controls presently in place at the Department of Labor and Workforce Development (DLWD) require eligibility interviews to be conducted and eligibility review forms to be completed and signed by the participant and UI program representative. DLWD will work to strengthen and reinforce these controls with responsible staff in an effort to ensure that all interviews are properly documented and eligibility review forms are signed and maintained on file for future reference and compliance support.
Reference Number: 2022-006Prior Year Finding: 2021-012Federal Agency: U.S. Department of LaborState Agency: Department of Labor and Workforce DevelopmentFederal Program: Unemployment InsuranceAssistance Listing Number: 17.225Award Number and Year: UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022)Compliance Requirement: Information Technology General ControlsType of Finding Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As part of an entity?s internal controls to reasonably ensure compliance over Federal laws and regulations, an entity must maintain an effective control environment over their information technology systems used to generate and process information to administer Federal programs in accordance with the respective rules and regulations that govern the program.Condition:The Department of Labor and Workforce Development (Department) did not maintain an effective control environment over change management of the New Jersey Local Office Online Payment System (NJLOOPS).Context:The NJLOOPS application is an essential system hosted within the Office of Information Technology?s (OIT) infrastructure used by the Department for unemployment insurance eligibility, claims, benefit calculations, and payments. NJLOOPS application management is provided by Department staff. We noted that the prior year finding for internal controls over change management was not corrected. Specifically, we noted that while tickets have been documented for the sample of changes tested for the NJLOOPS change management procedures, they do not maintain key information described in the change management policy. Further, we noted that two individuals have the ability to develop and promote their own changes to production which poses a segregation of duties issue.Questioned costs:Undetermined.Cause:Due to limitations on staffing and increased demand on IT resources due to the additional requirements of the pandemic's unemployment program, the agency was unable to comply with its internal change management procedures requirements.Effect:Noncompliance with the requirements of internal change management procedures and a lack of segregation of duties could increase the risk of potential unauthorized or unapproved changes occurring to the application.Recommendation:We recommend the Department follow the statewide change management policy and formally document the request, testing, and approval of all changes related to the NJLOOPS application. We further recommend that the Department implement segregation of duties controls to prevent the same user from developing, approving, and promoting a system change to the production environment.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) Office of Information Management, Services & Solutions (OIMSS) will continue its efforts to strengthen and improve staff compliance with existing controls over program change controls for the New Jersey Local Office Online Payment System (NJLOOPs). OIMSS management will conduct a meeting with all staff involved in program changes to reiterate that existing control requirements must be adhered to at all times. DLWD expects to achieve full compliance with exiting controls by June 30, 2023.
Reference Number:2022-003Prior Year Finding:2021-007Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 - Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:EligibilityType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Regular Unemployment Compensation (UC) Program ? Under state UC laws, a worker?s benefit rights depend on the amount of the worker?s wages and/or weeks of work in covered employment in a ?base period.? While most states define the base period as the first four of the last five completed calendar quarters prior to the filing of the claim, other base periods may be used. To qualify for benefits, a claimant must have earned a certain amount of wages or have worked a certain number of weeks or calendar quarters within the base period or meet some combination of wage and employment requirements. Some states require a waiting period of one week of total or partial unemployment before UC is payable. A ?waiting period? is a non-compensable period of unemployment in which the worker is otherwise eligible for benefits. To be eligible to receive UC, all states provide that a claimant must have been separated from suitable work for non-disqualifying reasons under state law (i.e., not because of such acts as leaving voluntarily without good cause or discharge for misconduct connected with work). After separation, he or she must be able and available for work, actively seeking work, legally authorized to work in the United States and must not have refused an offer of suitable work.Pandemic Unemployment Assistance (PUA) ? PUA provides benefits to covered individuals, who are those individuals not eligible for regular unemployment compensation (UC or extended benefits under state or federal law or Pandemic Emergency Unemployment Compensation (PEUC), including those who have exhausted all rights to such benefits. Covered individuals also include self-employed, those seeking part-time employment, individuals lacking sufficient work history, and those who otherwise do not qualify for regular unemployment compensation or extended benefits under state or federal law or PEUC.PUA is payable to individuals who are ineligible for regular UC, and are unemployed, partially unemployed, or unable or unavailable to work due to one of the COVID-19 related reasons identified Attachment I to UIPL No. 16-20, Change 5. Section 2102(a)(3)(A)(ii)(I) of the CARES Act included 10 specific COVID-19 related reasons. The Department, under the authority provided by Section 2102(a)(3)(A)(ii)(I)(kk) of the CARES Act, has added additional COVID-19 related reasons; these are discussed in more detail in Section 4.a. of UIPL No. 16-20, Change 5. While three of these new COVID-19 related reasons were introduced to states with the publication of UIPL No. 16-20, Change 5 on February 25, 2021, all COVID-19 related reasons apply retroactively to the beginning of the PUA program.Additionally, as described in Section 4.b.i. of UIPL No. 16-20, Change 5, paraphrasing of the COVID-19 related reasons is not permissible; individuals must be permitted to select more than one COVID-19 related reason; individuals must be permitted to select different COVID-19 related reasons each week; and individuals must be permitted to file and select no COVID-19 related reasons.Federal Pandemic Unemployment Compensation (FPUC) ? To be eligible for FPUC during the program dates described in Section 8 above, individuals must be eligible to receive at least $1 of underlying benefits for the week in question (including regular UC, UCFE, UCX, PEUC, PUA, EB, STC, TRA, DUA, and SEA). FPUC does not require the individual to submit a separate initial application or continued claim.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:CLA noted that ineligible claimants were being paid unemployment insurance. The Department of Labor and Workforce Development (DLWD) did not maintain an effective control environment over eligibility requirements of the New Jersey Local Office Online Payment System (NJLOOPS) for both FPUC and PUA.Context:Sixty claimants were selected for testing which included 24 claimants for Regular UC and Extended Benefits, 25 claimants for FPUC and 11 claimants for PUA. We noted the following exceptions:? FPUC: 2 of 25 claimants receiving benefits did not receive at least $1 of other benefits for the payment period.? PUA: 4 of 11 claimants receiving PUA did not identify a COVID-19 reason for their unemployment and were ineligible for the program.Questioned costs:$2,320 - The total amount of benefits received by ineligible recipients:? FPUC: $600? PUA: $1,720Cause:The Department began providing benefits to claimants before NJLOOPS had completed the eligibility determination process.Effect:Ineligible claimants received unemployment compensation benefits.Recommendation:We recommend the Department review and enhance procedures and controls to ensure that only eligible claimants receive unemployment compensation benefits.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) has controls in place to only allow an FPUC payment to be made when an underlying Unemployment Insurance (UI) payment has also been processed. FPUC payments should not be issued to any claim without the underlying UI payment being made for the same week. The two FPUC payments issued and noted as exceptions during eligibility testing will be reviewed independently by DLWD to determine if the payments issued were to eligible recipients or not.For the PUA exceptions noted during Eligibility testing, overall the DLWD issued PUA payments to over 680,000 claimants during the COVID-19 pandemic. DLWD had controls in place to require a COVID related reason to make the claim PUA eligible and the weekly PUA certification required claimants to choose a COVID related reason for why they were out of work before they could get paid. The PUA payments in question will be reviewed independently by the DLWD to determine if the payments issued under PUA were appropriate or if they should have been paid instead under the regular UI program.
Reference Number:2022-004Prior Year Finding:2021-010Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Reporting ? ETA 9050 and ETA 9052Type of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: The ETA 9050 ? Time Lapse of All First Payments except Workshare report contains monthly information on first payment time lapse. This report concerns the time it takes states to pay benefits to claimants for the first compensable week of unemployment. First Payments are considered timely at 14/21 days, Interstate and Intrastate UI, UCFE, and UCX, full and partial weeks. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.The ETA 9052 ? Nonmonetary Determination Time Lapse Detection report contains monthly information on the time it take states to issue nonmonetary determinations from the date the issues are first detected by the agency. Single-claimant and multi-claimant nonmonetary determinations are included in the report. Nonmonetary determinations made by organizational units such as Benefits Accuracy Measurement (BAM) and Benefit Payment Control (BPC) are also included in the report. Nonmonetary determinations are considered timely if completed within 21 days. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Reports submitted by the Department of Labor and Workforce Development (Department) indicate that First Payment Time Lapse and Nonmonetary Determinations were untimely during FY 2022.Context:Four ETA 9050 and four ETA 9052 reports were selected for testing for the months of September 2021, November 2021, February 2022, and May 2022. We noted the following exceptions:? ETA 9050: 4 of 4 reports indicate that First Payments were made in more than 14/21 days.? ETA 9052: 4 of 4 reports indicate that nonmonetary determinations were completed in more than 21 days.Questioned costs:None noted.Cause:The Department?s procedures and controls were not operating effectively to ensure that first payments and nonmonetary determinations were completed timely.Effect:First Payments and Nonmonetary Determinations were not completed timely as required by the program.Recommendation:We recommend that the Department review its policies and procedures to ensure that it makes first payments within 14/21 days and that nonmonetary determinations are completed within 21 days per program requirements.Views of responsible officials:New Jersey continues to make progress towards meeting the first payment and non-monetary time lapse standards as recovery from the historic claims filing related to the COVID-19 pandemic continues. As indicated in the prior year update, time lapse standards for both first payment and non-monetary continue to increase from the lows seen during the pandemic. Most recent figures for February 2023 show first payment time lapse at 65.1% and year-to-date at 54.5%, both up from what was reported last November 2022 at 40% and 36.4%, respectively. Non-monetary time lapse figures have also improved, with the most recent February 2023 figures reported as 62.6% for the month and 44.1% year-to-date, which is up from 24.0% for March 2022 and year-to-date at that time of 33.0%).It is important to note that before the pandemic hit in March 2020, New Jersey current figures at that time met all first payment and non-monetary time lapse standards for the reporting year that ended March 2020. The decrease to the timeliness figures is a direct result of the significant increase to workload volumes resulting from the pandemic and not due to a lack of proper internal controls.In addition to the high workloads, New Jersey has also implemented strict anti-fraud measures that include all new claims filed going through an identity proofing process before any payments can be issued. Delays on the claimant end to complete the verification process ? either by the claimant not going through the process or having difficulty with completing it ? also will have a direct impact on first payment time lapse. Increased education to claimants on the requirement to verify their ID, as well as increasing the tools and greater availability of support for ID verification will provide claimants with more options to meet this requirement. New Jersey has worked with our identity verification partner to allow for three different methods of verification; 1) self-service online, 2) connect to a `Trusted Referee? with our identity verification partner who will provide the verification online through a video call, or 3) an in-person appointment at a walk-in center to complete the process. In addition to what is offered by the vendor, One Stop centers throughout the State have been equipped with upgraded monitors with cameras that will allow claimants that are unable to complete the process with our vendor to report to one of these centers and complete the process there.As New Jersey continues to work through the backlog of claims, it is anticipated that overall time lapse figures will continue to improve and for the reporting year ending March 2024 progress will be made towards meeting the established standards.
Reference Number:2022-005Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Special Tests and Provisions: UI Reemployment Programs: RESEAType of Finding:Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 42 U.S. Code ? 506 (a) The Secretary of Labor (in this section referred to as the ?Secretary?) shall award grants under this section for a fiscal year to eligible States to conduct a program of reemployment services and eligibility assessments for individuals referred to reemployment services as described in section 503(j) of this title for weeks in such fiscal year for which such individuals receive unemployment compensation. Further, per 42 U.S. Code ? 506 (c) (1), In carrying out a State program of reemployment services and eligibility assessments using grant funds awarded to the State under this section, a State shall use such funds only for interventions demonstrated to reduce the number of weeks for which program participants receive unemployment compensation by improving employment outcomes for program participants.The UI program serves as one of the principal ?gateways? to the workforce system. It is often the first workforce program accessed by individuals who need workforce services. The WPRS and RESEA programs serve as UI?s primary programs that facilitate the reemployment needs of UI claimants.WPRS, which is mandated by Section 303(j) of the Social Security Act, is designed to identify UI claimants who are most likely to exhaust their benefits and need reemployment assistance to return to work, and refer them to appropriate reemployment services, such as: job search and job placement assistance; counseling; testing; provision of occupational and labor market information; and assessments. WPRS provides reemployment services to selected claimants through an early intervention process. The number of individuals served under WPRS is determined by the state (and/or local areas) based on its capacity to serve these individuals. UIPL No. 41-94 provides guidance on WPRS requirements.RESEA is authorized by Section 306 of the Social Security Act and builds on the success of RESEA?s predecessor, the former UI Reemployment and Eligibility Assessment (REA) program. RESEA uses an evidence-based integrated approach that combines an eligibility assessment for continuing UI eligibility and the provision of reemployment services. State administration of the RESEA is voluntary and under certain circumstances may be designed to also satisfy WPRS requirements. Operating guidance for the RESEA program is updated annually. UIPL 13-21 provides RESEA operating Guidance for FY 2021.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor (Department) did not retain documentation required by the RESEA program to verify compliance with federal program regulations. Controls were not working sufficiently to document that a staff member at the Department with knowledge of the program reviewed eligibility requirements prior to admission of participants to the RESEA program.Context:The Department?s policy is that RESEA eligibility interviews must be conducted and eligibility review forms completed. Both steps are to be reviewed and signed by the participant and an Unemployment Insurance (UI) staff member who is knowledgeable of the program requirements. For three of sixty cases selected for testing, the Department was unable to provide a signed RESEA worksheet indicating the interview had been completed and the claimant was reviewed and approved by a UI supervisor.Questioned costs:Undetermined.Cause:The Department?s procedures and internal controls are not sufficient to ensure compliance with RESEA requirements.Effect:Without clear documentation supporting a participant?s eligibility and supervisory review, ineligible participants could go undetected and federal funds could be paid to recipients who do not qualify to participate in the RESEA program.Recommendation:We recommend that policies and procedures be implemented to ensure that internal controls over RESEA include retention of documentation of each participant?s eligibility and review and approval by a UI supervisor.Views of responsible officials:The RESEA policy and controls presently in place at the Department of Labor and Workforce Development (DLWD) require eligibility interviews to be conducted and eligibility review forms to be completed and signed by the participant and UI program representative. DLWD will work to strengthen and reinforce these controls with responsible staff in an effort to ensure that all interviews are properly documented and eligibility review forms are signed and maintained on file for future reference and compliance support.
Reference Number: 2022-006Prior Year Finding: 2021-012Federal Agency: U.S. Department of LaborState Agency: Department of Labor and Workforce DevelopmentFederal Program: Unemployment InsuranceAssistance Listing Number: 17.225Award Number and Year: UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022)Compliance Requirement: Information Technology General ControlsType of Finding Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As part of an entity?s internal controls to reasonably ensure compliance over Federal laws and regulations, an entity must maintain an effective control environment over their information technology systems used to generate and process information to administer Federal programs in accordance with the respective rules and regulations that govern the program.Condition:The Department of Labor and Workforce Development (Department) did not maintain an effective control environment over change management of the New Jersey Local Office Online Payment System (NJLOOPS).Context:The NJLOOPS application is an essential system hosted within the Office of Information Technology?s (OIT) infrastructure used by the Department for unemployment insurance eligibility, claims, benefit calculations, and payments. NJLOOPS application management is provided by Department staff. We noted that the prior year finding for internal controls over change management was not corrected. Specifically, we noted that while tickets have been documented for the sample of changes tested for the NJLOOPS change management procedures, they do not maintain key information described in the change management policy. Further, we noted that two individuals have the ability to develop and promote their own changes to production which poses a segregation of duties issue.Questioned costs:Undetermined.Cause:Due to limitations on staffing and increased demand on IT resources due to the additional requirements of the pandemic's unemployment program, the agency was unable to comply with its internal change management procedures requirements.Effect:Noncompliance with the requirements of internal change management procedures and a lack of segregation of duties could increase the risk of potential unauthorized or unapproved changes occurring to the application.Recommendation:We recommend the Department follow the statewide change management policy and formally document the request, testing, and approval of all changes related to the NJLOOPS application. We further recommend that the Department implement segregation of duties controls to prevent the same user from developing, approving, and promoting a system change to the production environment.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) Office of Information Management, Services & Solutions (OIMSS) will continue its efforts to strengthen and improve staff compliance with existing controls over program change controls for the New Jersey Local Office Online Payment System (NJLOOPs). OIMSS management will conduct a meeting with all staff involved in program changes to reiterate that existing control requirements must be adhered to at all times. DLWD expects to achieve full compliance with exiting controls by June 30, 2023.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-008Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Emergency Rental Assistance ProgramAssistance Listing Number:21.023Award Number and Year:ERA0222 (3/13/2020 ? 9/30/2025), ERAE0490 (3/13/2020 - 9/30/2025)Compliance Requirement:ReportingType of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Emergency Rental Assistance (ERA) 1 and ERA 2 state, local, and territorial recipients were required to submit monthly and quarterly reports to the United States Department of the Treasury (U.S. Treasury). The monthly reports are brief two-question updates through which ERA recipients provide U.S. Treasury with very high-level counts of the numbers of households receiving assistance and the amounts of ERA funds distributed. The quarterly reports are in-depth reports with data on an array of programmatic and financial information to provide transparency in the use and progress of ERA funds. Monthly reports were required for each month of Fiscal Year 2022 and were due 15 days after the end of the month. Quarterly reports were required for each quarter of Fiscal Year 2022 and were due October 29, 2021, February 1, 2022, April 15, 2022, and July 15, 2022.The Emergency Rental Assistance Program Reporting Guidance published by the U.S. Treasury identifies several steps in the reporting process:? Recipients gather and maintain required information such as counts of applicants and participants; amounts paid directly or indirectly to tenants, landlords, and utility/home energy providers; amounts paid to subrecipients and contractors; and administrative expenses.? Recipients will need to communicate with and gather required information from their subrecipients and contractors, if applicable.? After manually entering or uploading the report information, Recipients must review the information entered or submitted to the online reporting forms for any errors and completeness. Following completion of the report in Treasury?s portal, the Recipient?s designated Authorized Representative for Reporting must certify to the authenticity and accuracy of the information provided and formally submit the report to Treasury.SF-425, Federal Financial Report: As stated in the award terms and conditions of the award agreement, a final SF-425, Federal Financial Report, is due 90 days after the expiration of the award and should be submitted electronically. The awardee shall report program outlays and program income on the same accounting basis (i.e., cash or accrual) that it uses in its normal accounting system. When submitting a final SF-425, Federal Financial Report, the total matching contribution, if required, should be shown in the report. The final SF-425 must not show any unliquidated obligations. If the awardee still has valid obligations that remain unpaid when the report is due, it shall request an extension of time for submitting the report pursuant to paragraph (c) of this section; submit a provisional report (showing the unliquidated obligations) by the due date; and submit a final report when all obligations have been liquidated, but no later than the approved extension date. SF-425, Federal Financial Reports, must be submitted by all awardees, including Federal agencies and national laboratories.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:As the direct recipient of ERA funds, the Department of Community Affairs (DCA) is responsible for ensuring the timeliness and accuracy of report submissions. We noted that monthly and quarterly special reports and quarterly financial reports submitted during FY 2022 did not agree with supporting documentation.Context:We selected eight monthly special reports, four quarterly special reports, and two quarterly financial reports for testing and we noted that for 13 of 14 reports selected, amounts reported did not agree to supporting documentation. Specifically, we noted the following exceptions:? Four of four quarterly special reports submitted did not agree to supporting documentation.? Five of eight monthly special reports submitted were missing expenditures that were included in supporting documentation.? For two of eight monthly reports submitted, DCA was unable to provide supporting documentation for reported expenditures.? Two of two quarterly financial reports submitted did not agree to supporting documentation.We noted that the reports contained all required data elements, however, DCA was unable to provide supporting documentation that agreed with the information reported. We also noted that DCA used the same data used for the quarterly reports with their submission of the financial SF-425 reports.Cause:DCA?s procedures were not sufficient to ensure the accuracy of the reports submitted to the U.S. Treasury nor that it maintained documentation supporting the information reported. Internal controls did not prevent or detect the errors.Effect:Information reported to the U.S. Treasury may have been inaccurate since it did not agree to supporting documentation.Questioned costs:Undetermined.Recommendation:We recommend that DCA implement formal policies and procedures to verify the information reported and that reports are reviewed for accuracy before they are submitted to U.S. Treasury to ensure that reports filed are complete and accurate. We further recommend that DCA retains supporting documentation used when preparing reports, and that this documentation is available for audit.Views of responsible officials:U.S. Treasury?s COVID-19 Emergency Rental Assistance Program (ERA) was established in 2021 to support housing stability throughout the pandemic by providing assistance payments for renters facing eviction. The Department of Community Affairs (DCA) is a direct recipient of ERA funding for use in preventing evictions for over 70,000 families throughout the State of New Jersey.Since the rollout of the new ERA program back in 2021, the reporting requirements and guidance provided by U.S. Treasury to ERA recipients evolved with numerous changes and updates posted that also required DCA to change and update systems over time. As the programs continued to evolve so did DCA?s reporting process. U.S. Treasury initially required monthly reporting starting in April 2021, through which ERA recipients provided U.S. Treasury with very high-level counts of the numbers of households receiving assistance and the amounts of ERA funds distributed. The monthly reporting requirement was then discontinued after the June 30, 2022 submission and thereafter, U.S. Treasury shifted the ERA Reporting guidance to be focused primarily on the quarterly reporting requirements and also amended those reporting requirements going forward.When preparing monthly and quarterly reports, DCA?s data source used has always been the most reliable one at the time the report was due in order to ensure accuracy of information reported to U.S. Treasury. As previously stated, DCA?s systems evolved as needed in order to keep up with the constant changes in reporting requirements for the ERA program.? At the inception of the program, reporting was done from the primary Podio system that obligated and requested payments.? DCA then worked to build the necessary reports from the MRI system that generated ERA payments in order to trace payments back to checks issued ? representing distributions incurred.? Most recently DCA has been working to reconcile MRI with the State?s NJCFS accounting system to further validate the MRI data. Over time variances have been identified that affect reporting such as void and uncashed check actions.DCA recognizes the need to ensure supporting documentation used to prepare quarterly and other required reports for Treasury is captured and retained for audit purposes. DCA continues to build?a three-way reconciliation between the three primary systems to document explainable variances among the systems, such as timing differences, voids, returned items, etc. DCA has implemented a corrective action plan to enhance the availability of supporting documentation for ERA Treasury reporting as detailed in the State?s official corrective action plan.
Reference Number:2022-009Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Homeowner Assistance FundAssistance Listing Number:21.026Award Number and Year:HAF0019 (2021)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:One subaward was issued by the Department of Community Affairs (Department) during FY 2022 which was selected for testing. The subaward was issued on 8/23/2021 and it was not reported to FSRS until 2/7/2022, or 130 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Community Affairs (DCA) has internal controls and procedures in place to ensure that required subawards are reported timely to FSRS in accordance with FFATA reporting requirements. The Homeowner Assistance Fund award received by DCA was unique in that it was planned and fully reallocated via Memorandum of Understanding (MOU) agreement to a DCA affiliate organization to administer on the State?s behalf. As a result, the DCA did not initially believe this single reallocation transaction was subject to FFATA reporting requirements. The Accountability Officer at the affiliate organization will be involved should another program and contractual arrangement of this type occur and will ensure that the FSRS reporting is done timely. No further subaward transactions are expected to be processed by DCA as the full allocation was disbursed to our affiliate organization upon receipt of the award and execution of the MOU.
Reference Number:2022-010Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Homeowner Assistance FundAssistance Listing Number:21.026Award Number and Year:HAF0019 (2021)Compliance Requirement:Subrecipient MonitoringType of FindingSignificant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR section 200.332(a), all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.Required information includes:i. Subrecipient name (which must match the name associated with its unique entity identifier);ii. Subrecipient's unique entity identifier;iii. Federal Award Identification Number (FAIN);iv. Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency;v. Subaward Period of Performance Start and End Date;vi. Subaward Budget Period Start and End Date;vii. Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient;viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation;ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity;x. Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA);xi. Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity;xii. Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement;xiii. Identification of whether the award is R&D; andxiv. Indirect cost rate for the Federal award (including if the de minimis rate is charged) per section 200.414.2 CFR section 200.332 also states that pass-through entities must:(d) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as:1) The subrecipient's prior experience with the same or similar subawards;2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F - Audit Requirements of this part, and the extent to which the same or similar subaward has been audited as a major program;3) Whether the subrecipient has new personnel or new or substantially changed systems;4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency).(e) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include:(1) Reviewing financial and performance reports required by the pass-through entity.(2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means.(3) Issuing a management decision for audit findings pertaining to the Federal award provided to the subrecipient from the pass-through entity as required by ? 200.521 Management decision.(f) Verify that every subrecipient is audited as required by Subpart F - Audit Requirements of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in ? 200.501 Audit requirements.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not comply with subrecipient monitoring requirements for the program.Context:The Department issued one subaward under the program and it was noted that the subaward did not include all required Federal Award information, nor did the Department perform a risk assessment of the subrecipient or perform monitoring activities for the award.Questioned costs:None noted.Cause:The Department?s procedures and controls were not effective to ensure the subaward was issued in compliance with Federal requirements, nor that it performed a risk assessment or timely monitoring of subrecipient.Effect:Excluding the required federal grant award information at the time of the subaward may cause subrecipients and their auditors to be uninformed about specific program and other regulations that apply to the funds they receive. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in their Single Audit reports, and federal funds may not be properly audited at the subrecipient level in accordance with the Uniform Guidance.Not conducting during the award monitoring may result in a failure of the Division to detect that its subrecipients used subawards for unauthorized purposes, managed them in violation of the terms and conditions of the subawards, or that subaward performance goals were not achieved.Without ensuring subrecipients have obtained audits as required by Subpart F, there is an increased risk that subrecipients could be inappropriately spending and/or inaccurately tracking and reporting federal funds over multiple year periods, and these discrepancies may not be properly monitored, detected, and corrected by Division personnel on a timely basis.Recommendation:The Department should review and enhance internal controls and procedures to ensure that all required information is included in all subawards, that proper subrecipient monitoring is conducted, and that evaluation of independent audits is performed.Views of responsible officials:As recommended, the Department of Community Affairs (DCA) will review current procedures to ensure that all subaward information required by the federal Uniform Guidance is included in all subaward contracts and grant agreements. The DCA has also reviewed its current subrecipient monitoring procedures for standard subawards made by the agency and has determined that no internal control enhancements are required. The HAF award was a unique grant relationship for DCA in that the entire award was passed through to another New Jersey State government agency that is a direct affiliate of the Department. Monitoring procedures were determined based on the close working relationship with our affiliate organization and the fact that less than 1 percent of the grant award was expended through June 30, 2022. Current procedures included a risk assessment of the subrecipient and performance of the single audit desk review of the independent audit report. In addition, the Director of Audit, and the Executive Director of the subgrantee affiliate participate in weekly meetings where updates on the program status can be determined. DCA?s subrecipient monitoring plan also includes the hiring of an Integrity Monitor to oversee and monitor the use of the HAF funds as well as compliance with all HAF program reporting requirements. As program disbursement activity is continuing to increase with the HAF program(s) created more fully up and running, DCA is currently targeting the Integrity Monitor hire to take place sometime within the next three to six months.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-014Prior Year Finding:2021-016Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6 NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Suspension and DebarmentType of FindingMaterial Weakness in Internal Control Over ComplianceCriteria or specific requirement:Compliance: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department could not provide support that it ensured its vendors were not suspended or debarred before issuing contracts to the entity.Context:The suspension and debarment status for eight of eight vendors was not documented. DRAFT4/18/2023Questioned costs:There are no questioned costs related to this finding as the vendors were not federally suspended or debarred.Cause:The Department did not establish effective internal controls for maintaining sufficient evidence that a suspension and debarment check was completed before issuing contracts to its vendors.Effect:If the suspension and debarment status of vendors is not verified when entering into covered transactions, it is possible that a contract could be issued to an ineligible vendor.Recommendation:We recommend the Department implement controls and procedures to ensure suspension and debarments checks are adequately documented and maintained in the vendor procurement files.Views of responsible officials:The New Jersey Department of Health?s (DOH) Central Procurement recently implemented revised Department policy FMC-23-02 and is working with the DOH divisional procurement staff within the agency to achieve full compliance. The revised policy circular includes the debarment language identified as missing in the previous FMC 21-02 policy.
Reference Number:2022-015Prior Year Finding:2021-017Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS by the Department of Health (Department) during FY 2022.Context:Twenty-one of twenty-one subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following:? 13 of 13 subawards issued between July and December 2020 were reported to FSRS between 273 and 725 days late.? 8 of 8 subawards issued in July and October 2021 were reported to FSRS between 244 and 512 days late.? Of the exceptions noted, 12 subawards totaling $10.6 million were not reported to FSRS until January 2023.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:With the Corrective Action Plan (CAP) previously developed as a result of the prior year 2021 audit finding, the Department?s Grants Unit with coordination from ELC program fiscal staff added a new function to the SAGE system that pulls all subaward data for all of ELC using its assigned ALN number 93.323. This system change was implemented in September 2022 that allows SAGE to pull data by CFDA number and enables the ELC fiscal staff to access all ELC subawards. ELC fiscal staff also has a reminder set to report at the end of each month, to enter FFATA information into FSRS, and to upload each report to SharePoint ELC Document Library at the end of each month.As per the prior year CAP created in September 2022, FFATA information for ELC subawards began being entered into FSRS on September 1, 2022.
Reference Number:2022-016Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6 NU62PS924524-01-04 (2018), 18NU62PS924524 (2019), 5 NU62PS924524-03-00 (2020), 6 NU62PS924524-03-02 (2020)Compliance Requirement:Allowable Costs/Cost PrinciplesType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per 2 CFR 200.403, except where otherwise authorized by statute, costs must meet the following general criteria to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocable under these principles.(b) Conform to any limitations or exclusions outlined in these principles or the Federal award regarding types or amount of cost items.(c) Be consistent with policies and procedures that apply uniformly to Federally financed and other activities of the non-Federal entity.(d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost.(e) Be determined following generally accepted accounting principles (GAAP), except for state and local governments and Indian tribes only, as otherwise provided for in this part.(f) Not be included as a cost or used to meet cost sharing or matching requirements of any other Federally financed program in either the current or a prior period. See also ?200.306 Cost sharing or matching paragraph (b).(g) Be adequately documented.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control-Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health (Department) was unable to provide supporting documentation for disbursement transactions charged to the program.Context:The Department was unable to provide supporting documentation for 17 of 60 disbursement transactions selected for testing. Auditors were not able to verify whether the expenditures were allowable per program requirements nor that they had been properly reviewed and approved.Questioned costs:Questioned costs of $59,466 represent the total of unsupported disbursements charged to the program.Cause:The Department?s procedures and controls were not sufficient to ensure that expenditures charged to the program were allowable and properly documented in accordance with federal requirements.Effect:Unallowable and unapproved costs may have been charged to the program.Recommendation:We recommend that the Department review its current procedures and controls to ensure that all expenditures charged to the program are supported by documentation, are properly reviewed and approved, and that documentation is readily available for audit. The Department should not seek federal reimbursement unless it can substantiate that disbursements are allowable and properly approved.Views of responsible officials:Due to the COVID-19 pandemic and the resulting remote teleworking period that was in place at the Department of Health (DOH) during the FY 2022 audit period, some payment documents were approved remotely without physical documents in hand, and the payment documentation for the 17 of 60 ELC general disbursement transactions examined were either not delivered to the office to be filed yet or have been delivered but misfiled. DOH Central Accounts Payable will review and improve its current procedures and controls to ensure all physical payment documents are reviewed, approved, and filed correctly under the current hybrid remote working conditions in place now since the pandemic ceased.
Reference Number:2022-014Prior Year Finding:2021-016Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6 NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Suspension and DebarmentType of FindingMaterial Weakness in Internal Control Over ComplianceCriteria or specific requirement:Compliance: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department could not provide support that it ensured its vendors were not suspended or debarred before issuing contracts to the entity.Context:The suspension and debarment status for eight of eight vendors was not documented. DRAFT4/18/2023Questioned costs:There are no questioned costs related to this finding as the vendors were not federally suspended or debarred.Cause:The Department did not establish effective internal controls for maintaining sufficient evidence that a suspension and debarment check was completed before issuing contracts to its vendors.Effect:If the suspension and debarment status of vendors is not verified when entering into covered transactions, it is possible that a contract could be issued to an ineligible vendor.Recommendation:We recommend the Department implement controls and procedures to ensure suspension and debarments checks are adequately documented and maintained in the vendor procurement files.Views of responsible officials:The New Jersey Department of Health?s (DOH) Central Procurement recently implemented revised Department policy FMC-23-02 and is working with the DOH divisional procurement staff within the agency to achieve full compliance. The revised policy circular includes the debarment language identified as missing in the previous FMC 21-02 policy.
Reference Number:2022-015Prior Year Finding:2021-017Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS by the Department of Health (Department) during FY 2022.Context:Twenty-one of twenty-one subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following:? 13 of 13 subawards issued between July and December 2020 were reported to FSRS between 273 and 725 days late.? 8 of 8 subawards issued in July and October 2021 were reported to FSRS between 244 and 512 days late.? Of the exceptions noted, 12 subawards totaling $10.6 million were not reported to FSRS until January 2023.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:With the Corrective Action Plan (CAP) previously developed as a result of the prior year 2021 audit finding, the Department?s Grants Unit with coordination from ELC program fiscal staff added a new function to the SAGE system that pulls all subaward data for all of ELC using its assigned ALN number 93.323. This system change was implemented in September 2022 that allows SAGE to pull data by CFDA number and enables the ELC fiscal staff to access all ELC subawards. ELC fiscal staff also has a reminder set to report at the end of each month, to enter FFATA information into FSRS, and to upload each report to SharePoint ELC Document Library at the end of each month.As per the prior year CAP created in September 2022, FFATA information for ELC subawards began being entered into FSRS on September 1, 2022.
Reference Number:2022-016Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6 NU62PS924524-01-04 (2018), 18NU62PS924524 (2019), 5 NU62PS924524-03-00 (2020), 6 NU62PS924524-03-02 (2020)Compliance Requirement:Allowable Costs/Cost PrinciplesType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per 2 CFR 200.403, except where otherwise authorized by statute, costs must meet the following general criteria to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocable under these principles.(b) Conform to any limitations or exclusions outlined in these principles or the Federal award regarding types or amount of cost items.(c) Be consistent with policies and procedures that apply uniformly to Federally financed and other activities of the non-Federal entity.(d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost.(e) Be determined following generally accepted accounting principles (GAAP), except for state and local governments and Indian tribes only, as otherwise provided for in this part.(f) Not be included as a cost or used to meet cost sharing or matching requirements of any other Federally financed program in either the current or a prior period. See also ?200.306 Cost sharing or matching paragraph (b).(g) Be adequately documented.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control-Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health (Department) was unable to provide supporting documentation for disbursement transactions charged to the program.Context:The Department was unable to provide supporting documentation for 17 of 60 disbursement transactions selected for testing. Auditors were not able to verify whether the expenditures were allowable per program requirements nor that they had been properly reviewed and approved.Questioned costs:Questioned costs of $59,466 represent the total of unsupported disbursements charged to the program.Cause:The Department?s procedures and controls were not sufficient to ensure that expenditures charged to the program were allowable and properly documented in accordance with federal requirements.Effect:Unallowable and unapproved costs may have been charged to the program.Recommendation:We recommend that the Department review its current procedures and controls to ensure that all expenditures charged to the program are supported by documentation, are properly reviewed and approved, and that documentation is readily available for audit. The Department should not seek federal reimbursement unless it can substantiate that disbursements are allowable and properly approved.Views of responsible officials:Due to the COVID-19 pandemic and the resulting remote teleworking period that was in place at the Department of Health (DOH) during the FY 2022 audit period, some payment documents were approved remotely without physical documents in hand, and the payment documentation for the 17 of 60 ELC general disbursement transactions examined were either not delivered to the office to be filed yet or have been delivered but misfiled. DOH Central Accounts Payable will review and improve its current procedures and controls to ensure all physical payment documents are reviewed, approved, and filed correctly under the current hybrid remote working conditions in place now since the pandemic ceased.
Reference Number:2022-017Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $3,241,668, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:During FY 2022, there was a vacancy in the Department?s staffing assigned to FFATA reporting, a breakdown in the transition responsibilities for the position, and a delay in hiring a replacement.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department cross-train staff to ensure it maintains capacity to meet FFATA requirements in the event that a staffing vacancy occurs in the future.Views of responsible officials:The Department of Community Affairs (DCA) now has a staff member in place with assigned responsibility for the FFATA reporting in the Federal Subaward Reporting System (FSRS) and other required federal reporting. To ensure that all required reporting in FSRS is completed timely, the process and procedures will be fully documented and the LIHEAP program manager will verify completion each month. DCA will also hire additional staff or cross-train current staff to further support the federal reporting function.
Reference Number:2022-018Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Cash ManagementType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 2 CFR 200.302, each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) was not able to provide documentation that drawdown requests had been properly approved.Context:Two of eight drawdown requests selected did not have evidence of supervisory approval prior to submission of the requests to the federal agency. The amounts drawn down for the two samples were $282,956 and $74,916 respectively.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that drawdown requests were reviewed and approved prior to submission. Internal controls did not prevent or detect the errors.Effect:Without proper review and approval of drawdown requests, the amounts requested could be inaccurate which could result in the Department receiving program funds to which it is not entitled.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that cash drawdowns are reviewed and approved prior to submission to the federal agency.Views of responsible officials:The Department of Community Affairs (DCA) staff responsible for the LIHEAP cash management function retired prior to this audit period without a proper transition of these tasks and there was also a delay in refilling the position. As recommended, the DCA has reviewed current procedures and controls regarding cash drawdown approvals and has developed a Policy Memo that details the Payment Management System (PMS) drawdown procedures going forward. For each request made, a Contract Administrator will produce a Business Object report for all transactions to be included in the drawdown and will send the report to the Program staff for review and approval that the amounts contained in the report are correct. Once the Program staff review is complete, the approved Business Object report will be forwarded with a cover email to the Division Fiscal Unit staff responsible for drawing down the funds in PMS for final processing.Views of responsible officials:
Reference Number:2022-019Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Performance and Special ReportingType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: LIHEAP Performance Data Form (OMB No 0970-0449) ? State grantees must submit this report by January 31st regarding the prior federal fiscal year. The first section of the report is the Grantee Survey that covers sources and allocation of funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service.Carryover and Reallotment Report (OMB No. 0970-0106) ? Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported.Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) ? As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Indian tribes are required to report only on the number of households served for each program component.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not submit performance and special reports timely. The LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted after their respective due dates.Context:We selected for testing the LIHEAP Performance Data Form, the LIHEAP Carryover and Reallotment Report, and the Annual Report on Households Assisted by LIHEAP which were due during FY2022. The following exceptions were noted:? One of one LIHEAP Performance Data Forms was not submitted timely. The report for the period ending 9/30/2021 was due by 1/31/2022 but was not submitted until 4/22/2022, or 81 days late.? One of one LIHEAP Carryover and Reallotment Reports was not submitted timely. The report was due by 8/1/2021, but was not submitted until 11/16/2021, or 107 days late.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that the LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted timely. Internal controls did not prevent or detect the errors.Effect:Delays in submission of annual performance and special reports could impact the Federal agency?s ability to manage the program, could result in delays in annual awards, and possible penalties or sanctions could be imposed by the grantor.Recommendation:We recommend that the Department review and enhance its procedures and internal controls to ensure that performance and special reports are submitted timely.Views of responsible officials:All performance and special reports noted in the audit finding must be approved by the Applied Public Policy Research Institute for Study and Evaluation (APPRISE - U.S. Department of Health and Human Services (USDHHS) Consultants) before they are submitted to USDHHS. The final reports noted as exceptions were not submitted on time due to pandemic related complications, staff retirements and communication issues with APPRISE. As recommended, the Department of Community Affairs (DCA) has reviewed current reporting procedures and Program staff will be assigned the responsibility to prepare all reports, work with APPRISE to obtain required approvals, and submit the all required reports on a timely basis. Reporting due dates and deadlines will be documented to ensure that initial reports are produced timely. The timeframe needed to coordinate with the APPRISE consultants for reviews and updates to the reports will also be built into the process so that final reports are submitted to USDHHS by the due date. All reporting procedures will be documented and distributed to LIHEAP program staff.
Reference Number:2022-017Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $3,241,668, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:During FY 2022, there was a vacancy in the Department?s staffing assigned to FFATA reporting, a breakdown in the transition responsibilities for the position, and a delay in hiring a replacement.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department cross-train staff to ensure it maintains capacity to meet FFATA requirements in the event that a staffing vacancy occurs in the future.Views of responsible officials:The Department of Community Affairs (DCA) now has a staff member in place with assigned responsibility for the FFATA reporting in the Federal Subaward Reporting System (FSRS) and other required federal reporting. To ensure that all required reporting in FSRS is completed timely, the process and procedures will be fully documented and the LIHEAP program manager will verify completion each month. DCA will also hire additional staff or cross-train current staff to further support the federal reporting function.
Reference Number:2022-018Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Cash ManagementType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 2 CFR 200.302, each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) was not able to provide documentation that drawdown requests had been properly approved.Context:Two of eight drawdown requests selected did not have evidence of supervisory approval prior to submission of the requests to the federal agency. The amounts drawn down for the two samples were $282,956 and $74,916 respectively.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that drawdown requests were reviewed and approved prior to submission. Internal controls did not prevent or detect the errors.Effect:Without proper review and approval of drawdown requests, the amounts requested could be inaccurate which could result in the Department receiving program funds to which it is not entitled.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that cash drawdowns are reviewed and approved prior to submission to the federal agency.Views of responsible officials:The Department of Community Affairs (DCA) staff responsible for the LIHEAP cash management function retired prior to this audit period without a proper transition of these tasks and there was also a delay in refilling the position. As recommended, the DCA has reviewed current procedures and controls regarding cash drawdown approvals and has developed a Policy Memo that details the Payment Management System (PMS) drawdown procedures going forward. For each request made, a Contract Administrator will produce a Business Object report for all transactions to be included in the drawdown and will send the report to the Program staff for review and approval that the amounts contained in the report are correct. Once the Program staff review is complete, the approved Business Object report will be forwarded with a cover email to the Division Fiscal Unit staff responsible for drawing down the funds in PMS for final processing.Views of responsible officials:
Reference Number:2022-019Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Performance and Special ReportingType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: LIHEAP Performance Data Form (OMB No 0970-0449) ? State grantees must submit this report by January 31st regarding the prior federal fiscal year. The first section of the report is the Grantee Survey that covers sources and allocation of funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service.Carryover and Reallotment Report (OMB No. 0970-0106) ? Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported.Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) ? As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Indian tribes are required to report only on the number of households served for each program component.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not submit performance and special reports timely. The LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted after their respective due dates.Context:We selected for testing the LIHEAP Performance Data Form, the LIHEAP Carryover and Reallotment Report, and the Annual Report on Households Assisted by LIHEAP which were due during FY2022. The following exceptions were noted:? One of one LIHEAP Performance Data Forms was not submitted timely. The report for the period ending 9/30/2021 was due by 1/31/2022 but was not submitted until 4/22/2022, or 81 days late.? One of one LIHEAP Carryover and Reallotment Reports was not submitted timely. The report was due by 8/1/2021, but was not submitted until 11/16/2021, or 107 days late.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that the LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted timely. Internal controls did not prevent or detect the errors.Effect:Delays in submission of annual performance and special reports could impact the Federal agency?s ability to manage the program, could result in delays in annual awards, and possible penalties or sanctions could be imposed by the grantor.Recommendation:We recommend that the Department review and enhance its procedures and internal controls to ensure that performance and special reports are submitted timely.Views of responsible officials:All performance and special reports noted in the audit finding must be approved by the Applied Public Policy Research Institute for Study and Evaluation (APPRISE - U.S. Department of Health and Human Services (USDHHS) Consultants) before they are submitted to USDHHS. The final reports noted as exceptions were not submitted on time due to pandemic related complications, staff retirements and communication issues with APPRISE. As recommended, the Department of Community Affairs (DCA) has reviewed current reporting procedures and Program staff will be assigned the responsibility to prepare all reports, work with APPRISE to obtain required approvals, and submit the all required reports on a timely basis. Reporting due dates and deadlines will be documented to ensure that initial reports are produced timely. The timeframe needed to coordinate with the APPRISE consultants for reviews and updates to the reports will also be built into the process so that final reports are submitted to USDHHS by the due date. All reporting procedures will be documented and distributed to LIHEAP program staff.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-021Prior Year Finding:NoFederal Agency:Department of Health and Human ServicesState Agency:Department of Children and FamiliesFederal Program:Social Services Block GrantAssistance Listing Number:93.667Award Number and Year:G-2200NJSOSR (10/1/2021 ? 3/30/2023)Compliance Requirement:Period of PerformanceType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award?s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods. Social Services Block Grant funds must be expended by the state in the fiscal year allotted or in the succeeding fiscal year.Control ? Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Children and Families (Department) charged costs to the program that were incurred outside of the grant award?s period of performance.Context:Four of forty expenditure transactions selected for testing, totaling $842, were incurred prior to the award start date of October 1, 2021.Questioned costs:$842, the total of expenditures charged to the program that were incurred outside of the grant award?s period of performance.Cause:Accounting staff identified and charged program costs to the incorrect grant. The Department?s review process did not detect the errors nor take timely corrective action.Effect:The Department was not compliant with the grant?s period of performance which could result in the grantor?s disallowance of the costs.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that expenditures charged to the program are incurred within the grant?s period of performance.Views of responsible officials:The Department of Children and Families (DCF) will review and enhance its procedures and controls to ensure that expenditures charged to the program are incurred within each grant award?s specified period of performance.Further, as the federal SSBG grant award cited has a period of performance that remains open through September 2023, DCF has adjusted the four transactions that were posted incorrectly to another available funding source and ensured that all transactions presently recorded are now in compliance and within the specified period of performance.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-024Prior Year Finding:NoFederal Agency:Social Security AdministrationState Agency:Department of Labor and Workforce DevelopmentFederal Program:Disability Insurance/SSI ClusterAssistance Listing Number:96.001Award Number and Year:04-2204NJD100 (10/1/2021 ? 3/30/2023), 04-2104NJD100 (10/1/2020 ? 3/30/2022), 04-2004NJD100 (10/1/2019 ? 3/30/2021)Compliance Requirement:Period of PerformanceType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award?s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods.Control ? Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor and Workforce Development (Department) charged costs to the program that were incurred outside of the grant award?s period of performance.Context:Two of six expenditure transactions selected for testing, totaling $435, were incurred prior to the award start date of October 1, 2021.Questioned costs:$435, the total of expenditures charged to the program that were incurred outside of the grant?s period of performance.Cause:Accounting staff identified and charged program costs to the incorrect grant. The Program?s review process did not detect the errors nor take timely corrective action.Effect:The Department was not compliant with the grant?s period of performance which could result in the grantor?s disallowance of the costs.Recommendation:We recommend that the Department review its procedures to ensure that expenditures charged to the program are incurred within the grant?s period of performance.Views of responsible officials:The New Jersey Department of Labor and Workforce Development (DLWD) has a policy in place for processing tuition reimbursements that are performed by the Department?s Accounts Payable unit. The policy was reviewed by the Office of Finance & Accounting (F&A) and internal control procedures were enhanced to ensure that fiscal cutoff measures were appropriately addressed. Tuition reimbursement procedures include having the requests forwarded to the responsible Supervising Analyst in the Appropriations/Accounting unit for final review and approval to ensure the proper fiscal period is charged. The correcting transactions were completed during the Single Audit timeframe to remediate the findings by charging and reimbursing the proper fiscal year accounts. The DLWD will continue its efforts to ensure compliance and that all charges applied to Federal awards are within the specified period of performance going forward.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-002Prior Year Finding:NoFederal Agency:U.S. Department of AgricultureState Agency:Department of AgricultureFederal Program:Child Nutrition ClusterAssistance Listing Number:10.553, 10.555, 10.556, 10.559, 10.582Award Number and Year:INJ300304 (10/1/2020-9/30/2022)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Agriculture (Department) did not report subaward information timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were issued on 10/1/2021 and were not reported to FSRS until 9/30/2022, or 304 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Agriculture, Division of Food and Nutrition (DOA) was delinquent in submitting required reporting in the FFFATA Subaward Reporting System (FSRS) due to the inability to make system updates for the UEI change during the pandemic. This prevented the DOA from pulling data to submit the reports to the FSRS. The DOA has two technical staff members assigned to query the data fields required to upload the report. Once the query is complete the data is converted to a CSV file and uploaded to FSRS. As of December 2022, monthly reporting has resumed. Successful monthly upload documentation will now be provided and monitored by the Assistant Division Director and Fiscal Coordinator.
Reference Number:2022-003Prior Year Finding:2021-007Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 - Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:EligibilityType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Regular Unemployment Compensation (UC) Program ? Under state UC laws, a worker?s benefit rights depend on the amount of the worker?s wages and/or weeks of work in covered employment in a ?base period.? While most states define the base period as the first four of the last five completed calendar quarters prior to the filing of the claim, other base periods may be used. To qualify for benefits, a claimant must have earned a certain amount of wages or have worked a certain number of weeks or calendar quarters within the base period or meet some combination of wage and employment requirements. Some states require a waiting period of one week of total or partial unemployment before UC is payable. A ?waiting period? is a non-compensable period of unemployment in which the worker is otherwise eligible for benefits. To be eligible to receive UC, all states provide that a claimant must have been separated from suitable work for non-disqualifying reasons under state law (i.e., not because of such acts as leaving voluntarily without good cause or discharge for misconduct connected with work). After separation, he or she must be able and available for work, actively seeking work, legally authorized to work in the United States and must not have refused an offer of suitable work.Pandemic Unemployment Assistance (PUA) ? PUA provides benefits to covered individuals, who are those individuals not eligible for regular unemployment compensation (UC or extended benefits under state or federal law or Pandemic Emergency Unemployment Compensation (PEUC), including those who have exhausted all rights to such benefits. Covered individuals also include self-employed, those seeking part-time employment, individuals lacking sufficient work history, and those who otherwise do not qualify for regular unemployment compensation or extended benefits under state or federal law or PEUC.PUA is payable to individuals who are ineligible for regular UC, and are unemployed, partially unemployed, or unable or unavailable to work due to one of the COVID-19 related reasons identified Attachment I to UIPL No. 16-20, Change 5. Section 2102(a)(3)(A)(ii)(I) of the CARES Act included 10 specific COVID-19 related reasons. The Department, under the authority provided by Section 2102(a)(3)(A)(ii)(I)(kk) of the CARES Act, has added additional COVID-19 related reasons; these are discussed in more detail in Section 4.a. of UIPL No. 16-20, Change 5. While three of these new COVID-19 related reasons were introduced to states with the publication of UIPL No. 16-20, Change 5 on February 25, 2021, all COVID-19 related reasons apply retroactively to the beginning of the PUA program.Additionally, as described in Section 4.b.i. of UIPL No. 16-20, Change 5, paraphrasing of the COVID-19 related reasons is not permissible; individuals must be permitted to select more than one COVID-19 related reason; individuals must be permitted to select different COVID-19 related reasons each week; and individuals must be permitted to file and select no COVID-19 related reasons.Federal Pandemic Unemployment Compensation (FPUC) ? To be eligible for FPUC during the program dates described in Section 8 above, individuals must be eligible to receive at least $1 of underlying benefits for the week in question (including regular UC, UCFE, UCX, PEUC, PUA, EB, STC, TRA, DUA, and SEA). FPUC does not require the individual to submit a separate initial application or continued claim.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:CLA noted that ineligible claimants were being paid unemployment insurance. The Department of Labor and Workforce Development (DLWD) did not maintain an effective control environment over eligibility requirements of the New Jersey Local Office Online Payment System (NJLOOPS) for both FPUC and PUA.Context:Sixty claimants were selected for testing which included 24 claimants for Regular UC and Extended Benefits, 25 claimants for FPUC and 11 claimants for PUA. We noted the following exceptions:? FPUC: 2 of 25 claimants receiving benefits did not receive at least $1 of other benefits for the payment period.? PUA: 4 of 11 claimants receiving PUA did not identify a COVID-19 reason for their unemployment and were ineligible for the program.Questioned costs:$2,320 - The total amount of benefits received by ineligible recipients:? FPUC: $600? PUA: $1,720Cause:The Department began providing benefits to claimants before NJLOOPS had completed the eligibility determination process.Effect:Ineligible claimants received unemployment compensation benefits.Recommendation:We recommend the Department review and enhance procedures and controls to ensure that only eligible claimants receive unemployment compensation benefits.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) has controls in place to only allow an FPUC payment to be made when an underlying Unemployment Insurance (UI) payment has also been processed. FPUC payments should not be issued to any claim without the underlying UI payment being made for the same week. The two FPUC payments issued and noted as exceptions during eligibility testing will be reviewed independently by DLWD to determine if the payments issued were to eligible recipients or not.For the PUA exceptions noted during Eligibility testing, overall the DLWD issued PUA payments to over 680,000 claimants during the COVID-19 pandemic. DLWD had controls in place to require a COVID related reason to make the claim PUA eligible and the weekly PUA certification required claimants to choose a COVID related reason for why they were out of work before they could get paid. The PUA payments in question will be reviewed independently by the DLWD to determine if the payments issued under PUA were appropriate or if they should have been paid instead under the regular UI program.
Reference Number:2022-004Prior Year Finding:2021-010Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Reporting ? ETA 9050 and ETA 9052Type of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: The ETA 9050 ? Time Lapse of All First Payments except Workshare report contains monthly information on first payment time lapse. This report concerns the time it takes states to pay benefits to claimants for the first compensable week of unemployment. First Payments are considered timely at 14/21 days, Interstate and Intrastate UI, UCFE, and UCX, full and partial weeks. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.The ETA 9052 ? Nonmonetary Determination Time Lapse Detection report contains monthly information on the time it take states to issue nonmonetary determinations from the date the issues are first detected by the agency. Single-claimant and multi-claimant nonmonetary determinations are included in the report. Nonmonetary determinations made by organizational units such as Benefits Accuracy Measurement (BAM) and Benefit Payment Control (BPC) are also included in the report. Nonmonetary determinations are considered timely if completed within 21 days. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Reports submitted by the Department of Labor and Workforce Development (Department) indicate that First Payment Time Lapse and Nonmonetary Determinations were untimely during FY 2022.Context:Four ETA 9050 and four ETA 9052 reports were selected for testing for the months of September 2021, November 2021, February 2022, and May 2022. We noted the following exceptions:? ETA 9050: 4 of 4 reports indicate that First Payments were made in more than 14/21 days.? ETA 9052: 4 of 4 reports indicate that nonmonetary determinations were completed in more than 21 days.Questioned costs:None noted.Cause:The Department?s procedures and controls were not operating effectively to ensure that first payments and nonmonetary determinations were completed timely.Effect:First Payments and Nonmonetary Determinations were not completed timely as required by the program.Recommendation:We recommend that the Department review its policies and procedures to ensure that it makes first payments within 14/21 days and that nonmonetary determinations are completed within 21 days per program requirements.Views of responsible officials:New Jersey continues to make progress towards meeting the first payment and non-monetary time lapse standards as recovery from the historic claims filing related to the COVID-19 pandemic continues. As indicated in the prior year update, time lapse standards for both first payment and non-monetary continue to increase from the lows seen during the pandemic. Most recent figures for February 2023 show first payment time lapse at 65.1% and year-to-date at 54.5%, both up from what was reported last November 2022 at 40% and 36.4%, respectively. Non-monetary time lapse figures have also improved, with the most recent February 2023 figures reported as 62.6% for the month and 44.1% year-to-date, which is up from 24.0% for March 2022 and year-to-date at that time of 33.0%).It is important to note that before the pandemic hit in March 2020, New Jersey current figures at that time met all first payment and non-monetary time lapse standards for the reporting year that ended March 2020. The decrease to the timeliness figures is a direct result of the significant increase to workload volumes resulting from the pandemic and not due to a lack of proper internal controls.In addition to the high workloads, New Jersey has also implemented strict anti-fraud measures that include all new claims filed going through an identity proofing process before any payments can be issued. Delays on the claimant end to complete the verification process ? either by the claimant not going through the process or having difficulty with completing it ? also will have a direct impact on first payment time lapse. Increased education to claimants on the requirement to verify their ID, as well as increasing the tools and greater availability of support for ID verification will provide claimants with more options to meet this requirement. New Jersey has worked with our identity verification partner to allow for three different methods of verification; 1) self-service online, 2) connect to a `Trusted Referee? with our identity verification partner who will provide the verification online through a video call, or 3) an in-person appointment at a walk-in center to complete the process. In addition to what is offered by the vendor, One Stop centers throughout the State have been equipped with upgraded monitors with cameras that will allow claimants that are unable to complete the process with our vendor to report to one of these centers and complete the process there.As New Jersey continues to work through the backlog of claims, it is anticipated that overall time lapse figures will continue to improve and for the reporting year ending March 2024 progress will be made towards meeting the established standards.
Reference Number:2022-005Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Special Tests and Provisions: UI Reemployment Programs: RESEAType of Finding:Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 42 U.S. Code ? 506 (a) The Secretary of Labor (in this section referred to as the ?Secretary?) shall award grants under this section for a fiscal year to eligible States to conduct a program of reemployment services and eligibility assessments for individuals referred to reemployment services as described in section 503(j) of this title for weeks in such fiscal year for which such individuals receive unemployment compensation. Further, per 42 U.S. Code ? 506 (c) (1), In carrying out a State program of reemployment services and eligibility assessments using grant funds awarded to the State under this section, a State shall use such funds only for interventions demonstrated to reduce the number of weeks for which program participants receive unemployment compensation by improving employment outcomes for program participants.The UI program serves as one of the principal ?gateways? to the workforce system. It is often the first workforce program accessed by individuals who need workforce services. The WPRS and RESEA programs serve as UI?s primary programs that facilitate the reemployment needs of UI claimants.WPRS, which is mandated by Section 303(j) of the Social Security Act, is designed to identify UI claimants who are most likely to exhaust their benefits and need reemployment assistance to return to work, and refer them to appropriate reemployment services, such as: job search and job placement assistance; counseling; testing; provision of occupational and labor market information; and assessments. WPRS provides reemployment services to selected claimants through an early intervention process. The number of individuals served under WPRS is determined by the state (and/or local areas) based on its capacity to serve these individuals. UIPL No. 41-94 provides guidance on WPRS requirements.RESEA is authorized by Section 306 of the Social Security Act and builds on the success of RESEA?s predecessor, the former UI Reemployment and Eligibility Assessment (REA) program. RESEA uses an evidence-based integrated approach that combines an eligibility assessment for continuing UI eligibility and the provision of reemployment services. State administration of the RESEA is voluntary and under certain circumstances may be designed to also satisfy WPRS requirements. Operating guidance for the RESEA program is updated annually. UIPL 13-21 provides RESEA operating Guidance for FY 2021.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor (Department) did not retain documentation required by the RESEA program to verify compliance with federal program regulations. Controls were not working sufficiently to document that a staff member at the Department with knowledge of the program reviewed eligibility requirements prior to admission of participants to the RESEA program.Context:The Department?s policy is that RESEA eligibility interviews must be conducted and eligibility review forms completed. Both steps are to be reviewed and signed by the participant and an Unemployment Insurance (UI) staff member who is knowledgeable of the program requirements. For three of sixty cases selected for testing, the Department was unable to provide a signed RESEA worksheet indicating the interview had been completed and the claimant was reviewed and approved by a UI supervisor.Questioned costs:Undetermined.Cause:The Department?s procedures and internal controls are not sufficient to ensure compliance with RESEA requirements.Effect:Without clear documentation supporting a participant?s eligibility and supervisory review, ineligible participants could go undetected and federal funds could be paid to recipients who do not qualify to participate in the RESEA program.Recommendation:We recommend that policies and procedures be implemented to ensure that internal controls over RESEA include retention of documentation of each participant?s eligibility and review and approval by a UI supervisor.Views of responsible officials:The RESEA policy and controls presently in place at the Department of Labor and Workforce Development (DLWD) require eligibility interviews to be conducted and eligibility review forms to be completed and signed by the participant and UI program representative. DLWD will work to strengthen and reinforce these controls with responsible staff in an effort to ensure that all interviews are properly documented and eligibility review forms are signed and maintained on file for future reference and compliance support.
Reference Number: 2022-006Prior Year Finding: 2021-012Federal Agency: U.S. Department of LaborState Agency: Department of Labor and Workforce DevelopmentFederal Program: Unemployment InsuranceAssistance Listing Number: 17.225Award Number and Year: UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022)Compliance Requirement: Information Technology General ControlsType of Finding Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As part of an entity?s internal controls to reasonably ensure compliance over Federal laws and regulations, an entity must maintain an effective control environment over their information technology systems used to generate and process information to administer Federal programs in accordance with the respective rules and regulations that govern the program.Condition:The Department of Labor and Workforce Development (Department) did not maintain an effective control environment over change management of the New Jersey Local Office Online Payment System (NJLOOPS).Context:The NJLOOPS application is an essential system hosted within the Office of Information Technology?s (OIT) infrastructure used by the Department for unemployment insurance eligibility, claims, benefit calculations, and payments. NJLOOPS application management is provided by Department staff. We noted that the prior year finding for internal controls over change management was not corrected. Specifically, we noted that while tickets have been documented for the sample of changes tested for the NJLOOPS change management procedures, they do not maintain key information described in the change management policy. Further, we noted that two individuals have the ability to develop and promote their own changes to production which poses a segregation of duties issue.Questioned costs:Undetermined.Cause:Due to limitations on staffing and increased demand on IT resources due to the additional requirements of the pandemic's unemployment program, the agency was unable to comply with its internal change management procedures requirements.Effect:Noncompliance with the requirements of internal change management procedures and a lack of segregation of duties could increase the risk of potential unauthorized or unapproved changes occurring to the application.Recommendation:We recommend the Department follow the statewide change management policy and formally document the request, testing, and approval of all changes related to the NJLOOPS application. We further recommend that the Department implement segregation of duties controls to prevent the same user from developing, approving, and promoting a system change to the production environment.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) Office of Information Management, Services & Solutions (OIMSS) will continue its efforts to strengthen and improve staff compliance with existing controls over program change controls for the New Jersey Local Office Online Payment System (NJLOOPs). OIMSS management will conduct a meeting with all staff involved in program changes to reiterate that existing control requirements must be adhered to at all times. DLWD expects to achieve full compliance with exiting controls by June 30, 2023.
Reference Number:2022-003Prior Year Finding:2021-007Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 - Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:EligibilityType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Regular Unemployment Compensation (UC) Program ? Under state UC laws, a worker?s benefit rights depend on the amount of the worker?s wages and/or weeks of work in covered employment in a ?base period.? While most states define the base period as the first four of the last five completed calendar quarters prior to the filing of the claim, other base periods may be used. To qualify for benefits, a claimant must have earned a certain amount of wages or have worked a certain number of weeks or calendar quarters within the base period or meet some combination of wage and employment requirements. Some states require a waiting period of one week of total or partial unemployment before UC is payable. A ?waiting period? is a non-compensable period of unemployment in which the worker is otherwise eligible for benefits. To be eligible to receive UC, all states provide that a claimant must have been separated from suitable work for non-disqualifying reasons under state law (i.e., not because of such acts as leaving voluntarily without good cause or discharge for misconduct connected with work). After separation, he or she must be able and available for work, actively seeking work, legally authorized to work in the United States and must not have refused an offer of suitable work.Pandemic Unemployment Assistance (PUA) ? PUA provides benefits to covered individuals, who are those individuals not eligible for regular unemployment compensation (UC or extended benefits under state or federal law or Pandemic Emergency Unemployment Compensation (PEUC), including those who have exhausted all rights to such benefits. Covered individuals also include self-employed, those seeking part-time employment, individuals lacking sufficient work history, and those who otherwise do not qualify for regular unemployment compensation or extended benefits under state or federal law or PEUC.PUA is payable to individuals who are ineligible for regular UC, and are unemployed, partially unemployed, or unable or unavailable to work due to one of the COVID-19 related reasons identified Attachment I to UIPL No. 16-20, Change 5. Section 2102(a)(3)(A)(ii)(I) of the CARES Act included 10 specific COVID-19 related reasons. The Department, under the authority provided by Section 2102(a)(3)(A)(ii)(I)(kk) of the CARES Act, has added additional COVID-19 related reasons; these are discussed in more detail in Section 4.a. of UIPL No. 16-20, Change 5. While three of these new COVID-19 related reasons were introduced to states with the publication of UIPL No. 16-20, Change 5 on February 25, 2021, all COVID-19 related reasons apply retroactively to the beginning of the PUA program.Additionally, as described in Section 4.b.i. of UIPL No. 16-20, Change 5, paraphrasing of the COVID-19 related reasons is not permissible; individuals must be permitted to select more than one COVID-19 related reason; individuals must be permitted to select different COVID-19 related reasons each week; and individuals must be permitted to file and select no COVID-19 related reasons.Federal Pandemic Unemployment Compensation (FPUC) ? To be eligible for FPUC during the program dates described in Section 8 above, individuals must be eligible to receive at least $1 of underlying benefits for the week in question (including regular UC, UCFE, UCX, PEUC, PUA, EB, STC, TRA, DUA, and SEA). FPUC does not require the individual to submit a separate initial application or continued claim.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:CLA noted that ineligible claimants were being paid unemployment insurance. The Department of Labor and Workforce Development (DLWD) did not maintain an effective control environment over eligibility requirements of the New Jersey Local Office Online Payment System (NJLOOPS) for both FPUC and PUA.Context:Sixty claimants were selected for testing which included 24 claimants for Regular UC and Extended Benefits, 25 claimants for FPUC and 11 claimants for PUA. We noted the following exceptions:? FPUC: 2 of 25 claimants receiving benefits did not receive at least $1 of other benefits for the payment period.? PUA: 4 of 11 claimants receiving PUA did not identify a COVID-19 reason for their unemployment and were ineligible for the program.Questioned costs:$2,320 - The total amount of benefits received by ineligible recipients:? FPUC: $600? PUA: $1,720Cause:The Department began providing benefits to claimants before NJLOOPS had completed the eligibility determination process.Effect:Ineligible claimants received unemployment compensation benefits.Recommendation:We recommend the Department review and enhance procedures and controls to ensure that only eligible claimants receive unemployment compensation benefits.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) has controls in place to only allow an FPUC payment to be made when an underlying Unemployment Insurance (UI) payment has also been processed. FPUC payments should not be issued to any claim without the underlying UI payment being made for the same week. The two FPUC payments issued and noted as exceptions during eligibility testing will be reviewed independently by DLWD to determine if the payments issued were to eligible recipients or not.For the PUA exceptions noted during Eligibility testing, overall the DLWD issued PUA payments to over 680,000 claimants during the COVID-19 pandemic. DLWD had controls in place to require a COVID related reason to make the claim PUA eligible and the weekly PUA certification required claimants to choose a COVID related reason for why they were out of work before they could get paid. The PUA payments in question will be reviewed independently by the DLWD to determine if the payments issued under PUA were appropriate or if they should have been paid instead under the regular UI program.
Reference Number:2022-004Prior Year Finding:2021-010Federal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Reporting ? ETA 9050 and ETA 9052Type of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: The ETA 9050 ? Time Lapse of All First Payments except Workshare report contains monthly information on first payment time lapse. This report concerns the time it takes states to pay benefits to claimants for the first compensable week of unemployment. First Payments are considered timely at 14/21 days, Interstate and Intrastate UI, UCFE, and UCX, full and partial weeks. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.The ETA 9052 ? Nonmonetary Determination Time Lapse Detection report contains monthly information on the time it take states to issue nonmonetary determinations from the date the issues are first detected by the agency. Single-claimant and multi-claimant nonmonetary determinations are included in the report. Nonmonetary determinations made by organizational units such as Benefits Accuracy Measurement (BAM) and Benefit Payment Control (BPC) are also included in the report. Nonmonetary determinations are considered timely if completed within 21 days. The report is due in the ETA National Office on the 20th of the month following the month to which the data relates.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Reports submitted by the Department of Labor and Workforce Development (Department) indicate that First Payment Time Lapse and Nonmonetary Determinations were untimely during FY 2022.Context:Four ETA 9050 and four ETA 9052 reports were selected for testing for the months of September 2021, November 2021, February 2022, and May 2022. We noted the following exceptions:? ETA 9050: 4 of 4 reports indicate that First Payments were made in more than 14/21 days.? ETA 9052: 4 of 4 reports indicate that nonmonetary determinations were completed in more than 21 days.Questioned costs:None noted.Cause:The Department?s procedures and controls were not operating effectively to ensure that first payments and nonmonetary determinations were completed timely.Effect:First Payments and Nonmonetary Determinations were not completed timely as required by the program.Recommendation:We recommend that the Department review its policies and procedures to ensure that it makes first payments within 14/21 days and that nonmonetary determinations are completed within 21 days per program requirements.Views of responsible officials:New Jersey continues to make progress towards meeting the first payment and non-monetary time lapse standards as recovery from the historic claims filing related to the COVID-19 pandemic continues. As indicated in the prior year update, time lapse standards for both first payment and non-monetary continue to increase from the lows seen during the pandemic. Most recent figures for February 2023 show first payment time lapse at 65.1% and year-to-date at 54.5%, both up from what was reported last November 2022 at 40% and 36.4%, respectively. Non-monetary time lapse figures have also improved, with the most recent February 2023 figures reported as 62.6% for the month and 44.1% year-to-date, which is up from 24.0% for March 2022 and year-to-date at that time of 33.0%).It is important to note that before the pandemic hit in March 2020, New Jersey current figures at that time met all first payment and non-monetary time lapse standards for the reporting year that ended March 2020. The decrease to the timeliness figures is a direct result of the significant increase to workload volumes resulting from the pandemic and not due to a lack of proper internal controls.In addition to the high workloads, New Jersey has also implemented strict anti-fraud measures that include all new claims filed going through an identity proofing process before any payments can be issued. Delays on the claimant end to complete the verification process ? either by the claimant not going through the process or having difficulty with completing it ? also will have a direct impact on first payment time lapse. Increased education to claimants on the requirement to verify their ID, as well as increasing the tools and greater availability of support for ID verification will provide claimants with more options to meet this requirement. New Jersey has worked with our identity verification partner to allow for three different methods of verification; 1) self-service online, 2) connect to a `Trusted Referee? with our identity verification partner who will provide the verification online through a video call, or 3) an in-person appointment at a walk-in center to complete the process. In addition to what is offered by the vendor, One Stop centers throughout the State have been equipped with upgraded monitors with cameras that will allow claimants that are unable to complete the process with our vendor to report to one of these centers and complete the process there.As New Jersey continues to work through the backlog of claims, it is anticipated that overall time lapse figures will continue to improve and for the reporting year ending March 2024 progress will be made towards meeting the established standards.
Reference Number:2022-005Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:Unemployment Insurance, COVID-19 ? Unemployment InsuranceAssistance Listing Number:17.225Award Number and Year:UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022), UI-34073-20-55-A-34 (10/1/19 ? 12/31/22), UI-32614-19-55-A-34 (10/1/18 ? 12/31/21), UI-37238-22-55-A-34 (10/1/21 ? 12/31/24)Compliance Requirement:Special Tests and Provisions: UI Reemployment Programs: RESEAType of Finding:Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 42 U.S. Code ? 506 (a) The Secretary of Labor (in this section referred to as the ?Secretary?) shall award grants under this section for a fiscal year to eligible States to conduct a program of reemployment services and eligibility assessments for individuals referred to reemployment services as described in section 503(j) of this title for weeks in such fiscal year for which such individuals receive unemployment compensation. Further, per 42 U.S. Code ? 506 (c) (1), In carrying out a State program of reemployment services and eligibility assessments using grant funds awarded to the State under this section, a State shall use such funds only for interventions demonstrated to reduce the number of weeks for which program participants receive unemployment compensation by improving employment outcomes for program participants.The UI program serves as one of the principal ?gateways? to the workforce system. It is often the first workforce program accessed by individuals who need workforce services. The WPRS and RESEA programs serve as UI?s primary programs that facilitate the reemployment needs of UI claimants.WPRS, which is mandated by Section 303(j) of the Social Security Act, is designed to identify UI claimants who are most likely to exhaust their benefits and need reemployment assistance to return to work, and refer them to appropriate reemployment services, such as: job search and job placement assistance; counseling; testing; provision of occupational and labor market information; and assessments. WPRS provides reemployment services to selected claimants through an early intervention process. The number of individuals served under WPRS is determined by the state (and/or local areas) based on its capacity to serve these individuals. UIPL No. 41-94 provides guidance on WPRS requirements.RESEA is authorized by Section 306 of the Social Security Act and builds on the success of RESEA?s predecessor, the former UI Reemployment and Eligibility Assessment (REA) program. RESEA uses an evidence-based integrated approach that combines an eligibility assessment for continuing UI eligibility and the provision of reemployment services. State administration of the RESEA is voluntary and under certain circumstances may be designed to also satisfy WPRS requirements. Operating guidance for the RESEA program is updated annually. UIPL 13-21 provides RESEA operating Guidance for FY 2021.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor (Department) did not retain documentation required by the RESEA program to verify compliance with federal program regulations. Controls were not working sufficiently to document that a staff member at the Department with knowledge of the program reviewed eligibility requirements prior to admission of participants to the RESEA program.Context:The Department?s policy is that RESEA eligibility interviews must be conducted and eligibility review forms completed. Both steps are to be reviewed and signed by the participant and an Unemployment Insurance (UI) staff member who is knowledgeable of the program requirements. For three of sixty cases selected for testing, the Department was unable to provide a signed RESEA worksheet indicating the interview had been completed and the claimant was reviewed and approved by a UI supervisor.Questioned costs:Undetermined.Cause:The Department?s procedures and internal controls are not sufficient to ensure compliance with RESEA requirements.Effect:Without clear documentation supporting a participant?s eligibility and supervisory review, ineligible participants could go undetected and federal funds could be paid to recipients who do not qualify to participate in the RESEA program.Recommendation:We recommend that policies and procedures be implemented to ensure that internal controls over RESEA include retention of documentation of each participant?s eligibility and review and approval by a UI supervisor.Views of responsible officials:The RESEA policy and controls presently in place at the Department of Labor and Workforce Development (DLWD) require eligibility interviews to be conducted and eligibility review forms to be completed and signed by the participant and UI program representative. DLWD will work to strengthen and reinforce these controls with responsible staff in an effort to ensure that all interviews are properly documented and eligibility review forms are signed and maintained on file for future reference and compliance support.
Reference Number: 2022-006Prior Year Finding: 2021-012Federal Agency: U.S. Department of LaborState Agency: Department of Labor and Workforce DevelopmentFederal Program: Unemployment InsuranceAssistance Listing Number: 17.225Award Number and Year: UI-35663-21-55-A-34 (10/1/2020 ? 12/31/2023), UI-34510-20-60-A-34 (1/1/2020 ? 9/30/2021), UI-35959-21-60-A-34 (1/1/2021 ? 9/30/2022)Compliance Requirement: Information Technology General ControlsType of Finding Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As part of an entity?s internal controls to reasonably ensure compliance over Federal laws and regulations, an entity must maintain an effective control environment over their information technology systems used to generate and process information to administer Federal programs in accordance with the respective rules and regulations that govern the program.Condition:The Department of Labor and Workforce Development (Department) did not maintain an effective control environment over change management of the New Jersey Local Office Online Payment System (NJLOOPS).Context:The NJLOOPS application is an essential system hosted within the Office of Information Technology?s (OIT) infrastructure used by the Department for unemployment insurance eligibility, claims, benefit calculations, and payments. NJLOOPS application management is provided by Department staff. We noted that the prior year finding for internal controls over change management was not corrected. Specifically, we noted that while tickets have been documented for the sample of changes tested for the NJLOOPS change management procedures, they do not maintain key information described in the change management policy. Further, we noted that two individuals have the ability to develop and promote their own changes to production which poses a segregation of duties issue.Questioned costs:Undetermined.Cause:Due to limitations on staffing and increased demand on IT resources due to the additional requirements of the pandemic's unemployment program, the agency was unable to comply with its internal change management procedures requirements.Effect:Noncompliance with the requirements of internal change management procedures and a lack of segregation of duties could increase the risk of potential unauthorized or unapproved changes occurring to the application.Recommendation:We recommend the Department follow the statewide change management policy and formally document the request, testing, and approval of all changes related to the NJLOOPS application. We further recommend that the Department implement segregation of duties controls to prevent the same user from developing, approving, and promoting a system change to the production environment.Views of responsible officials:The Department of Labor and Workforce Development (DLWD) Office of Information Management, Services & Solutions (OIMSS) will continue its efforts to strengthen and improve staff compliance with existing controls over program change controls for the New Jersey Local Office Online Payment System (NJLOOPs). OIMSS management will conduct a meeting with all staff involved in program changes to reiterate that existing control requirements must be adhered to at all times. DLWD expects to achieve full compliance with exiting controls by June 30, 2023.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-007Prior Year Finding:NoFederal Agency:U.S. Department of LaborState Agency:Department of Labor and Workforce DevelopmentFederal Program:WIOA ClusterAssistance Listing Number:17.258, 17.259, 17.278Award Number and Year:AA-32176-18-55-A-34 (7/1/18 ? 9/30/21), AA-33245-19-55-A-34 (7/1/19 ? 9/30/22), AA-34783-20-55-A-34 (7/1/20 ? 9/30/23), AA-36334-21-55-A-34 (7/1/21 ? 9/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following exceptions:? 3 of 3 subawards issued on 7/1/2019 were reported to FSRS on 9/1/2021, or 733 days late.? 5 of 5 subawards issued between 7/1/2020 and 2/1/2022 were reported to FSRS on 2/6/2023, or between 343 and 951 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:In recent years, the Department of Labor and Workforce Development (DLWD) has transitioned from a manual contract process to a web-based system (i.e., SAGE and IGX systems) and has also experienced changes in personnel responsible for the contracting process. Although progress has been made with getting the FFATA Reporting Unit access to these automated systems, the DLWD will continue to enhance the communication between the offices that prepare and approve the contracts/agreements and the FFATA Reporting Unit. DLWD will also develop procedures to ensure that timely and accurate information is provided to the FFATA Reporting Unit and that group will also be included in the grant approval process so the unit is notified timely.
Reference Number:2022-008Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Emergency Rental Assistance ProgramAssistance Listing Number:21.023Award Number and Year:ERA0222 (3/13/2020 ? 9/30/2025), ERAE0490 (3/13/2020 - 9/30/2025)Compliance Requirement:ReportingType of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Emergency Rental Assistance (ERA) 1 and ERA 2 state, local, and territorial recipients were required to submit monthly and quarterly reports to the United States Department of the Treasury (U.S. Treasury). The monthly reports are brief two-question updates through which ERA recipients provide U.S. Treasury with very high-level counts of the numbers of households receiving assistance and the amounts of ERA funds distributed. The quarterly reports are in-depth reports with data on an array of programmatic and financial information to provide transparency in the use and progress of ERA funds. Monthly reports were required for each month of Fiscal Year 2022 and were due 15 days after the end of the month. Quarterly reports were required for each quarter of Fiscal Year 2022 and were due October 29, 2021, February 1, 2022, April 15, 2022, and July 15, 2022.The Emergency Rental Assistance Program Reporting Guidance published by the U.S. Treasury identifies several steps in the reporting process:? Recipients gather and maintain required information such as counts of applicants and participants; amounts paid directly or indirectly to tenants, landlords, and utility/home energy providers; amounts paid to subrecipients and contractors; and administrative expenses.? Recipients will need to communicate with and gather required information from their subrecipients and contractors, if applicable.? After manually entering or uploading the report information, Recipients must review the information entered or submitted to the online reporting forms for any errors and completeness. Following completion of the report in Treasury?s portal, the Recipient?s designated Authorized Representative for Reporting must certify to the authenticity and accuracy of the information provided and formally submit the report to Treasury.SF-425, Federal Financial Report: As stated in the award terms and conditions of the award agreement, a final SF-425, Federal Financial Report, is due 90 days after the expiration of the award and should be submitted electronically. The awardee shall report program outlays and program income on the same accounting basis (i.e., cash or accrual) that it uses in its normal accounting system. When submitting a final SF-425, Federal Financial Report, the total matching contribution, if required, should be shown in the report. The final SF-425 must not show any unliquidated obligations. If the awardee still has valid obligations that remain unpaid when the report is due, it shall request an extension of time for submitting the report pursuant to paragraph (c) of this section; submit a provisional report (showing the unliquidated obligations) by the due date; and submit a final report when all obligations have been liquidated, but no later than the approved extension date. SF-425, Federal Financial Reports, must be submitted by all awardees, including Federal agencies and national laboratories.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:As the direct recipient of ERA funds, the Department of Community Affairs (DCA) is responsible for ensuring the timeliness and accuracy of report submissions. We noted that monthly and quarterly special reports and quarterly financial reports submitted during FY 2022 did not agree with supporting documentation.Context:We selected eight monthly special reports, four quarterly special reports, and two quarterly financial reports for testing and we noted that for 13 of 14 reports selected, amounts reported did not agree to supporting documentation. Specifically, we noted the following exceptions:? Four of four quarterly special reports submitted did not agree to supporting documentation.? Five of eight monthly special reports submitted were missing expenditures that were included in supporting documentation.? For two of eight monthly reports submitted, DCA was unable to provide supporting documentation for reported expenditures.? Two of two quarterly financial reports submitted did not agree to supporting documentation.We noted that the reports contained all required data elements, however, DCA was unable to provide supporting documentation that agreed with the information reported. We also noted that DCA used the same data used for the quarterly reports with their submission of the financial SF-425 reports.Cause:DCA?s procedures were not sufficient to ensure the accuracy of the reports submitted to the U.S. Treasury nor that it maintained documentation supporting the information reported. Internal controls did not prevent or detect the errors.Effect:Information reported to the U.S. Treasury may have been inaccurate since it did not agree to supporting documentation.Questioned costs:Undetermined.Recommendation:We recommend that DCA implement formal policies and procedures to verify the information reported and that reports are reviewed for accuracy before they are submitted to U.S. Treasury to ensure that reports filed are complete and accurate. We further recommend that DCA retains supporting documentation used when preparing reports, and that this documentation is available for audit.Views of responsible officials:U.S. Treasury?s COVID-19 Emergency Rental Assistance Program (ERA) was established in 2021 to support housing stability throughout the pandemic by providing assistance payments for renters facing eviction. The Department of Community Affairs (DCA) is a direct recipient of ERA funding for use in preventing evictions for over 70,000 families throughout the State of New Jersey.Since the rollout of the new ERA program back in 2021, the reporting requirements and guidance provided by U.S. Treasury to ERA recipients evolved with numerous changes and updates posted that also required DCA to change and update systems over time. As the programs continued to evolve so did DCA?s reporting process. U.S. Treasury initially required monthly reporting starting in April 2021, through which ERA recipients provided U.S. Treasury with very high-level counts of the numbers of households receiving assistance and the amounts of ERA funds distributed. The monthly reporting requirement was then discontinued after the June 30, 2022 submission and thereafter, U.S. Treasury shifted the ERA Reporting guidance to be focused primarily on the quarterly reporting requirements and also amended those reporting requirements going forward.When preparing monthly and quarterly reports, DCA?s data source used has always been the most reliable one at the time the report was due in order to ensure accuracy of information reported to U.S. Treasury. As previously stated, DCA?s systems evolved as needed in order to keep up with the constant changes in reporting requirements for the ERA program.? At the inception of the program, reporting was done from the primary Podio system that obligated and requested payments.? DCA then worked to build the necessary reports from the MRI system that generated ERA payments in order to trace payments back to checks issued ? representing distributions incurred.? Most recently DCA has been working to reconcile MRI with the State?s NJCFS accounting system to further validate the MRI data. Over time variances have been identified that affect reporting such as void and uncashed check actions.DCA recognizes the need to ensure supporting documentation used to prepare quarterly and other required reports for Treasury is captured and retained for audit purposes. DCA continues to build?a three-way reconciliation between the three primary systems to document explainable variances among the systems, such as timing differences, voids, returned items, etc. DCA has implemented a corrective action plan to enhance the availability of supporting documentation for ERA Treasury reporting as detailed in the State?s official corrective action plan.
Reference Number:2022-009Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Homeowner Assistance FundAssistance Listing Number:21.026Award Number and Year:HAF0019 (2021)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:One subaward was issued by the Department of Community Affairs (Department) during FY 2022 which was selected for testing. The subaward was issued on 8/23/2021 and it was not reported to FSRS until 2/7/2022, or 130 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Community Affairs (DCA) has internal controls and procedures in place to ensure that required subawards are reported timely to FSRS in accordance with FFATA reporting requirements. The Homeowner Assistance Fund award received by DCA was unique in that it was planned and fully reallocated via Memorandum of Understanding (MOU) agreement to a DCA affiliate organization to administer on the State?s behalf. As a result, the DCA did not initially believe this single reallocation transaction was subject to FFATA reporting requirements. The Accountability Officer at the affiliate organization will be involved should another program and contractual arrangement of this type occur and will ensure that the FSRS reporting is done timely. No further subaward transactions are expected to be processed by DCA as the full allocation was disbursed to our affiliate organization upon receipt of the award and execution of the MOU.
Reference Number:2022-010Prior Year Finding:NoFederal Agency:U.S. Department of the TreasuryState Agency:Department of Community AffairsFederal Program:COVID-19 - Homeowner Assistance FundAssistance Listing Number:21.026Award Number and Year:HAF0019 (2021)Compliance Requirement:Subrecipient MonitoringType of FindingSignificant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR section 200.332(a), all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward.Required information includes:i. Subrecipient name (which must match the name associated with its unique entity identifier);ii. Subrecipient's unique entity identifier;iii. Federal Award Identification Number (FAIN);iv. Federal Award Date (see the definition of Federal award date in ? 200.1 of this part) of award to the recipient by the Federal agency;v. Subaward Period of Performance Start and End Date;vi. Subaward Budget Period Start and End Date;vii. Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient;viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation;ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity;x. Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA);xi. Name of Federal awarding agency, pass-through entity, and contact information for awarding official of the Pass-through entity;xii. Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement;xiii. Identification of whether the award is R&D; andxiv. Indirect cost rate for the Federal award (including if the de minimis rate is charged) per section 200.414.2 CFR section 200.332 also states that pass-through entities must:(d) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as:1) The subrecipient's prior experience with the same or similar subawards;2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F - Audit Requirements of this part, and the extent to which the same or similar subaward has been audited as a major program;3) Whether the subrecipient has new personnel or new or substantially changed systems;4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency).(e) Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include:(1) Reviewing financial and performance reports required by the pass-through entity.(2) Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means.(3) Issuing a management decision for audit findings pertaining to the Federal award provided to the subrecipient from the pass-through entity as required by ? 200.521 Management decision.(f) Verify that every subrecipient is audited as required by Subpart F - Audit Requirements of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in ? 200.501 Audit requirements.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not comply with subrecipient monitoring requirements for the program.Context:The Department issued one subaward under the program and it was noted that the subaward did not include all required Federal Award information, nor did the Department perform a risk assessment of the subrecipient or perform monitoring activities for the award.Questioned costs:None noted.Cause:The Department?s procedures and controls were not effective to ensure the subaward was issued in compliance with Federal requirements, nor that it performed a risk assessment or timely monitoring of subrecipient.Effect:Excluding the required federal grant award information at the time of the subaward may cause subrecipients and their auditors to be uninformed about specific program and other regulations that apply to the funds they receive. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in their Single Audit reports, and federal funds may not be properly audited at the subrecipient level in accordance with the Uniform Guidance.Not conducting during the award monitoring may result in a failure of the Division to detect that its subrecipients used subawards for unauthorized purposes, managed them in violation of the terms and conditions of the subawards, or that subaward performance goals were not achieved.Without ensuring subrecipients have obtained audits as required by Subpart F, there is an increased risk that subrecipients could be inappropriately spending and/or inaccurately tracking and reporting federal funds over multiple year periods, and these discrepancies may not be properly monitored, detected, and corrected by Division personnel on a timely basis.Recommendation:The Department should review and enhance internal controls and procedures to ensure that all required information is included in all subawards, that proper subrecipient monitoring is conducted, and that evaluation of independent audits is performed.Views of responsible officials:As recommended, the Department of Community Affairs (DCA) will review current procedures to ensure that all subaward information required by the federal Uniform Guidance is included in all subaward contracts and grant agreements. The DCA has also reviewed its current subrecipient monitoring procedures for standard subawards made by the agency and has determined that no internal control enhancements are required. The HAF award was a unique grant relationship for DCA in that the entire award was passed through to another New Jersey State government agency that is a direct affiliate of the Department. Monitoring procedures were determined based on the close working relationship with our affiliate organization and the fact that less than 1 percent of the grant award was expended through June 30, 2022. Current procedures included a risk assessment of the subrecipient and performance of the single audit desk review of the independent audit report. In addition, the Director of Audit, and the Executive Director of the subgrantee affiliate participate in weekly meetings where updates on the program status can be determined. DCA?s subrecipient monitoring plan also includes the hiring of an Integrity Monitor to oversee and monitor the use of the HAF funds as well as compliance with all HAF program reporting requirements. As program disbursement activity is continuing to increase with the HAF program(s) created more fully up and running, DCA is currently targeting the Integrity Monitor hire to take place sometime within the next three to six months.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-011Prior Year Finding:NoFederal Agency:U.S. Department of EducationState Agency:Department of CorrectionsFederal Program:Special Education Cluster IDEAAssistance Listing Number:84.027 and 84.173Award Number and Year:H027A200100 (7/1/2020 ? 9/30/2021), H027A200100-20A (7/1/2020 ? 9/30/2021), H027A210100 (7/1/2021 ? 9/30/2022), H027A2100100-21A (7/1/2021 ? 9/30/2022), H027X210100 (7/1/2021 ? 9/30/2022), H173A200114 (7/1/2020 ? 9/30/2021), H173A210114 (7/1/2021 ? 9/30/2022), H173X210114 (7/1/2021 ? 9/30/2021)Compliance Requirement:Allowable Costs/Cost Principles ? Time and Effort ReportingType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? Per 2 CFR ? 200.430 (a), costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity's laws or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.Per 2 CFR ? 200.430 (i), charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:? Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated,? Be incorporated into the official records of the non-Federal entity,? Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities,? Encompass both federally assisted, and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity's written policy,? Comply with the established accounting policies and practices of the non-Federal entity,? Support the distribution of the employee's salary or wages among specific activities or costobjectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity.Control ? Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in "Standards for Internal Control in the Federal Government" issued by the Comptroller General of the United States or the "Internal Control-Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Corrections (Department) did not maintain adequate support to validate actual payroll expenses charged to the program. An employee?s timesheet was not approved by the supervisor on a timely basis.Context:The Department was unable to provide documentation that one of forty employee timesheets selected for testing had been approved by the supervisor on a timely basis.Questioned costs:None noted.Cause:Controls were not operating effectively to ensure that time and effort reporting was performed in accordance with federal requirements.Effect:There is an increased risk of charging unallowed payroll costs to the program.Recommendation:The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program.Views of responsible officials:The Department of Corrections (DOC) held a meeting on March 22, 2023 with the Supervisors of Education where the importance of reviewing and approving all timesheets was reinforced. Staff were also informed and reminded of progressive discipline for future instances of timesheet approval omissions. DOC also plans to distribute a memorandum to all Supervisors and Assistant Supervisors of Education in an effort to ensure that proper controls are implemented for timely supervisory review and approvals of timesheets as required. Supervisors were also instructed to substantiate via email that timesheet approval, in their absence, will be approved by DOC Administration at their facility.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-012Prior Year Finding:2021-015Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Aging Cluster and COVID-19 Aging ClusterAssistance Listing Number:93.044, 93.045, 93.053Award Number and Year:2001NJCMC2-00 (3/20/2020 ? 9/30/2022)2101NJVAC5-00 (4/1/2022 ? 9/30/2022)2001NJHDC2-00 (3/20/2020 ? 9/30/2022)2101NJOASS-00 (10/1/2020 ? 9/30/2022)2101NJOASS-01 (10/1/2020 ? 9/30/2022)2101NJOANS-00 (10/1/2020 ? 9/30/2022)2101NJHDC5-00 (12/27/2020 ? 9/30/2022)2101NJSSC6-00 (4/1/2022 ? 9/30/2024)2001NJOASS-03 (10/1/2019 ? 9/30/2022)2001NJOANS-04 (10/1/2019 ? 9/30/2022)2201NJOASS-02 (10/1/2021 ? 9/30/2023)2201NJOACM-02 (10/1/2021 ? 9/30/2023)2201NJOAHD-02 (10/1/2021-9/30/2023)2201NJOAPH-02 (10/1/2021-9/30/2023)2201NJOAFC-02 (10/1/2021-9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of six subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $35,266,155, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The Department of Human Services, Division of Aging Services (DoAS) continues to work towards attaining full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The DoAS continues to consult with the Department and/or other DHS Division fiscal leadership to finalize the FFATA procedures. These procedures shall include creating a list of all active first-tier subawards of federal funds DoAS has issued at $30,000 or more. The list will include all the data fields required for FFATA reporting. DoAS grants management members will ensure each of the identified subawards is entered on the Federal Subaward Reporting System (FSRS) website. DoASwill also revise internal procedures to ensure all future subawards of $30,000 or more are entered on FSRS within 30 days of award.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-013Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Immunization Cooperative Agreements, COVID-19 - Immunization Cooperative AgreementsAssistance Listing Number:93.268Award Number and Year:NH23IP922594 (7/1/19 ? 6/30/24), 5NH23IP922594-02-00 (7/1/19 ? 6/30/24), NH23IP922594-03-00 (7/1/19 ? 6/30/24)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS during FY 2022.Context:Eight of eight subawards selected for testing were not reported timely to FSRS.Specifically, we noted the following:? 7 of 8 subawards were issued on 7/1/2021 and they were not reported to FSRS until 1/24/2023, or 511 days late.? 1 of 8 subawards was issued on 7/1/2022 and was not reported to FSRS until 1/24/2023, or 146 days late.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:The Department of Health, Division of Epidemiology, Environmental and Occupational Health?s (DEEOH), Vaccine Preventable Disease Program (VPDP) will attain full compliance with Federal Funding Accountability and Transparency Act (FFATA) requirements. The VPDP on boarded a full-time lead fiscal/grants officer in August 2022 to oversee the Immunization Cooperative Agreements, including COVID-19 supplemental funding. VPDP fiscal/grants leadership will implement FFATA procedures for the Immunization Cooperative Agreement. These procedures shall include creating a list of all active first-tier subawards of federal funds DEEOH has issued at $30,000 or more under this Cooperative Agreement. The list will include all the data fields required for FFATA reporting. DEEOH fiscal/grants leadership will ensure each of the identified sub-awards is entered on the FFATA Subaward Reporting System (FSRS) website within 30 days of award issuance or award amendment.
Reference Number:2022-014Prior Year Finding:2021-016Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6 NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Suspension and DebarmentType of FindingMaterial Weakness in Internal Control Over ComplianceCriteria or specific requirement:Compliance: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department could not provide support that it ensured its vendors were not suspended or debarred before issuing contracts to the entity.Context:The suspension and debarment status for eight of eight vendors was not documented. DRAFT4/18/2023Questioned costs:There are no questioned costs related to this finding as the vendors were not federally suspended or debarred.Cause:The Department did not establish effective internal controls for maintaining sufficient evidence that a suspension and debarment check was completed before issuing contracts to its vendors.Effect:If the suspension and debarment status of vendors is not verified when entering into covered transactions, it is possible that a contract could be issued to an ineligible vendor.Recommendation:We recommend the Department implement controls and procedures to ensure suspension and debarments checks are adequately documented and maintained in the vendor procurement files.Views of responsible officials:The New Jersey Department of Health?s (DOH) Central Procurement recently implemented revised Department policy FMC-23-02 and is working with the DOH divisional procurement staff within the agency to achieve full compliance. The revised policy circular includes the debarment language identified as missing in the previous FMC 21-02 policy.
Reference Number:2022-015Prior Year Finding:2021-017Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS by the Department of Health (Department) during FY 2022.Context:Twenty-one of twenty-one subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following:? 13 of 13 subawards issued between July and December 2020 were reported to FSRS between 273 and 725 days late.? 8 of 8 subawards issued in July and October 2021 were reported to FSRS between 244 and 512 days late.? Of the exceptions noted, 12 subawards totaling $10.6 million were not reported to FSRS until January 2023.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:With the Corrective Action Plan (CAP) previously developed as a result of the prior year 2021 audit finding, the Department?s Grants Unit with coordination from ELC program fiscal staff added a new function to the SAGE system that pulls all subaward data for all of ELC using its assigned ALN number 93.323. This system change was implemented in September 2022 that allows SAGE to pull data by CFDA number and enables the ELC fiscal staff to access all ELC subawards. ELC fiscal staff also has a reminder set to report at the end of each month, to enter FFATA information into FSRS, and to upload each report to SharePoint ELC Document Library at the end of each month.As per the prior year CAP created in September 2022, FFATA information for ELC subawards began being entered into FSRS on September 1, 2022.
Reference Number:2022-016Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6 NU62PS924524-01-04 (2018), 18NU62PS924524 (2019), 5 NU62PS924524-03-00 (2020), 6 NU62PS924524-03-02 (2020)Compliance Requirement:Allowable Costs/Cost PrinciplesType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per 2 CFR 200.403, except where otherwise authorized by statute, costs must meet the following general criteria to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocable under these principles.(b) Conform to any limitations or exclusions outlined in these principles or the Federal award regarding types or amount of cost items.(c) Be consistent with policies and procedures that apply uniformly to Federally financed and other activities of the non-Federal entity.(d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost.(e) Be determined following generally accepted accounting principles (GAAP), except for state and local governments and Indian tribes only, as otherwise provided for in this part.(f) Not be included as a cost or used to meet cost sharing or matching requirements of any other Federally financed program in either the current or a prior period. See also ?200.306 Cost sharing or matching paragraph (b).(g) Be adequately documented.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control-Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health (Department) was unable to provide supporting documentation for disbursement transactions charged to the program.Context:The Department was unable to provide supporting documentation for 17 of 60 disbursement transactions selected for testing. Auditors were not able to verify whether the expenditures were allowable per program requirements nor that they had been properly reviewed and approved.Questioned costs:Questioned costs of $59,466 represent the total of unsupported disbursements charged to the program.Cause:The Department?s procedures and controls were not sufficient to ensure that expenditures charged to the program were allowable and properly documented in accordance with federal requirements.Effect:Unallowable and unapproved costs may have been charged to the program.Recommendation:We recommend that the Department review its current procedures and controls to ensure that all expenditures charged to the program are supported by documentation, are properly reviewed and approved, and that documentation is readily available for audit. The Department should not seek federal reimbursement unless it can substantiate that disbursements are allowable and properly approved.Views of responsible officials:Due to the COVID-19 pandemic and the resulting remote teleworking period that was in place at the Department of Health (DOH) during the FY 2022 audit period, some payment documents were approved remotely without physical documents in hand, and the payment documentation for the 17 of 60 ELC general disbursement transactions examined were either not delivered to the office to be filed yet or have been delivered but misfiled. DOH Central Accounts Payable will review and improve its current procedures and controls to ensure all physical payment documents are reviewed, approved, and filed correctly under the current hybrid remote working conditions in place now since the pandemic ceased.
Reference Number:2022-014Prior Year Finding:2021-016Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6 NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Suspension and DebarmentType of FindingMaterial Weakness in Internal Control Over ComplianceCriteria or specific requirement:Compliance: Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department could not provide support that it ensured its vendors were not suspended or debarred before issuing contracts to the entity.Context:The suspension and debarment status for eight of eight vendors was not documented. DRAFT4/18/2023Questioned costs:There are no questioned costs related to this finding as the vendors were not federally suspended or debarred.Cause:The Department did not establish effective internal controls for maintaining sufficient evidence that a suspension and debarment check was completed before issuing contracts to its vendors.Effect:If the suspension and debarment status of vendors is not verified when entering into covered transactions, it is possible that a contract could be issued to an ineligible vendor.Recommendation:We recommend the Department implement controls and procedures to ensure suspension and debarments checks are adequately documented and maintained in the vendor procurement files.Views of responsible officials:The New Jersey Department of Health?s (DOH) Central Procurement recently implemented revised Department policy FMC-23-02 and is working with the DOH divisional procurement staff within the agency to achieve full compliance. The revised policy circular includes the debarment language identified as missing in the previous FMC 21-02 policy.
Reference Number:2022-015Prior Year Finding:2021-017Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525 (8/1/2019 ? 7/31/2024), 6NU50CK000525-02-03 (8/1/2020 - 7/31/2024), 5NU50CK000525-03-00 (8/1/2019 ? 7/31/2024)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Unique Entity ID (UEI) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported timely to FSRS by the Department of Health (Department) during FY 2022.Context:Twenty-one of twenty-one subawards selected for testing were not reported timely to FSRS. Specifically, we noted the following:? 13 of 13 subawards issued between July and December 2020 were reported to FSRS between 273 and 725 days late.? 8 of 8 subawards issued in July and October 2021 were reported to FSRS between 244 and 512 days late.? Of the exceptions noted, 12 subawards totaling $10.6 million were not reported to FSRS until January 2023.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department?s internal controls were not sufficient to ensure that subawards were reported timely to FSRS.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that all required subawards are reported timely to FSRS no later than the end of the month following the month of issuance in accordance with FFATA reporting requirements.Views of responsible officials:With the Corrective Action Plan (CAP) previously developed as a result of the prior year 2021 audit finding, the Department?s Grants Unit with coordination from ELC program fiscal staff added a new function to the SAGE system that pulls all subaward data for all of ELC using its assigned ALN number 93.323. This system change was implemented in September 2022 that allows SAGE to pull data by CFDA number and enables the ELC fiscal staff to access all ELC subawards. ELC fiscal staff also has a reminder set to report at the end of each month, to enter FFATA information into FSRS, and to upload each report to SharePoint ELC Document Library at the end of each month.As per the prior year CAP created in September 2022, FFATA information for ELC subawards began being entered into FSRS on September 1, 2022.
Reference Number:2022-016Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of HealthFederal Program:Epidemiology and Laboratory Capacity for Infectious Diseases (ELC), COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number:93.323Award Number and Year:6 NU62PS924524-01-04 (2018), 18NU62PS924524 (2019), 5 NU62PS924524-03-00 (2020), 6 NU62PS924524-03-02 (2020)Compliance Requirement:Allowable Costs/Cost PrinciplesType of Finding:Material Weakness in Internal Control Over Compliance, Material NoncomplianceCriteria or specific requirement:Compliance: Per 2 CFR 200.403, except where otherwise authorized by statute, costs must meet the following general criteria to be allowable under Federal awards:(a) Be necessary and reasonable for the performance of the Federal award and be allocable under these principles.(b) Conform to any limitations or exclusions outlined in these principles or the Federal award regarding types or amount of cost items.(c) Be consistent with policies and procedures that apply uniformly to Federally financed and other activities of the non-Federal entity.(d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost.(e) Be determined following generally accepted accounting principles (GAAP), except for state and local governments and Indian tribes only, as otherwise provided for in this part.(f) Not be included as a cost or used to meet cost sharing or matching requirements of any other Federally financed program in either the current or a prior period. See also ?200.306 Cost sharing or matching paragraph (b).(g) Be adequately documented.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with the guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control-Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health (Department) was unable to provide supporting documentation for disbursement transactions charged to the program.Context:The Department was unable to provide supporting documentation for 17 of 60 disbursement transactions selected for testing. Auditors were not able to verify whether the expenditures were allowable per program requirements nor that they had been properly reviewed and approved.Questioned costs:Questioned costs of $59,466 represent the total of unsupported disbursements charged to the program.Cause:The Department?s procedures and controls were not sufficient to ensure that expenditures charged to the program were allowable and properly documented in accordance with federal requirements.Effect:Unallowable and unapproved costs may have been charged to the program.Recommendation:We recommend that the Department review its current procedures and controls to ensure that all expenditures charged to the program are supported by documentation, are properly reviewed and approved, and that documentation is readily available for audit. The Department should not seek federal reimbursement unless it can substantiate that disbursements are allowable and properly approved.Views of responsible officials:Due to the COVID-19 pandemic and the resulting remote teleworking period that was in place at the Department of Health (DOH) during the FY 2022 audit period, some payment documents were approved remotely without physical documents in hand, and the payment documentation for the 17 of 60 ELC general disbursement transactions examined were either not delivered to the office to be filed yet or have been delivered but misfiled. DOH Central Accounts Payable will review and improve its current procedures and controls to ensure all physical payment documents are reviewed, approved, and filed correctly under the current hybrid remote working conditions in place now since the pandemic ceased.
Reference Number:2022-017Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $3,241,668, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:During FY 2022, there was a vacancy in the Department?s staffing assigned to FFATA reporting, a breakdown in the transition responsibilities for the position, and a delay in hiring a replacement.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department cross-train staff to ensure it maintains capacity to meet FFATA requirements in the event that a staffing vacancy occurs in the future.Views of responsible officials:The Department of Community Affairs (DCA) now has a staff member in place with assigned responsibility for the FFATA reporting in the Federal Subaward Reporting System (FSRS) and other required federal reporting. To ensure that all required reporting in FSRS is completed timely, the process and procedures will be fully documented and the LIHEAP program manager will verify completion each month. DCA will also hire additional staff or cross-train current staff to further support the federal reporting function.
Reference Number:2022-018Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Cash ManagementType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 2 CFR 200.302, each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) was not able to provide documentation that drawdown requests had been properly approved.Context:Two of eight drawdown requests selected did not have evidence of supervisory approval prior to submission of the requests to the federal agency. The amounts drawn down for the two samples were $282,956 and $74,916 respectively.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that drawdown requests were reviewed and approved prior to submission. Internal controls did not prevent or detect the errors.Effect:Without proper review and approval of drawdown requests, the amounts requested could be inaccurate which could result in the Department receiving program funds to which it is not entitled.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that cash drawdowns are reviewed and approved prior to submission to the federal agency.Views of responsible officials:The Department of Community Affairs (DCA) staff responsible for the LIHEAP cash management function retired prior to this audit period without a proper transition of these tasks and there was also a delay in refilling the position. As recommended, the DCA has reviewed current procedures and controls regarding cash drawdown approvals and has developed a Policy Memo that details the Payment Management System (PMS) drawdown procedures going forward. For each request made, a Contract Administrator will produce a Business Object report for all transactions to be included in the drawdown and will send the report to the Program staff for review and approval that the amounts contained in the report are correct. Once the Program staff review is complete, the approved Business Object report will be forwarded with a cover email to the Division Fiscal Unit staff responsible for drawing down the funds in PMS for final processing.Views of responsible officials:
Reference Number:2022-019Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Performance and Special ReportingType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: LIHEAP Performance Data Form (OMB No 0970-0449) ? State grantees must submit this report by January 31st regarding the prior federal fiscal year. The first section of the report is the Grantee Survey that covers sources and allocation of funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service.Carryover and Reallotment Report (OMB No. 0970-0106) ? Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported.Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) ? As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Indian tribes are required to report only on the number of households served for each program component.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not submit performance and special reports timely. The LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted after their respective due dates.Context:We selected for testing the LIHEAP Performance Data Form, the LIHEAP Carryover and Reallotment Report, and the Annual Report on Households Assisted by LIHEAP which were due during FY2022. The following exceptions were noted:? One of one LIHEAP Performance Data Forms was not submitted timely. The report for the period ending 9/30/2021 was due by 1/31/2022 but was not submitted until 4/22/2022, or 81 days late.? One of one LIHEAP Carryover and Reallotment Reports was not submitted timely. The report was due by 8/1/2021, but was not submitted until 11/16/2021, or 107 days late.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that the LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted timely. Internal controls did not prevent or detect the errors.Effect:Delays in submission of annual performance and special reports could impact the Federal agency?s ability to manage the program, could result in delays in annual awards, and possible penalties or sanctions could be imposed by the grantor.Recommendation:We recommend that the Department review and enhance its procedures and internal controls to ensure that performance and special reports are submitted timely.Views of responsible officials:All performance and special reports noted in the audit finding must be approved by the Applied Public Policy Research Institute for Study and Evaluation (APPRISE - U.S. Department of Health and Human Services (USDHHS) Consultants) before they are submitted to USDHHS. The final reports noted as exceptions were not submitted on time due to pandemic related complications, staff retirements and communication issues with APPRISE. As recommended, the Department of Community Affairs (DCA) has reviewed current reporting procedures and Program staff will be assigned the responsibility to prepare all reports, work with APPRISE to obtain required approvals, and submit the all required reports on a timely basis. Reporting due dates and deadlines will be documented to ensure that initial reports are produced timely. The timeframe needed to coordinate with the APPRISE consultants for reviews and updates to the reports will also be built into the process so that final reports are submitted to USDHHS by the due date. All reporting procedures will be documented and distributed to LIHEAP program staff.
Reference Number:2022-017Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of Finding:Material Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $3,241,668, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:During FY 2022, there was a vacancy in the Department?s staffing assigned to FFATA reporting, a breakdown in the transition responsibilities for the position, and a delay in hiring a replacement.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department cross-train staff to ensure it maintains capacity to meet FFATA requirements in the event that a staffing vacancy occurs in the future.Views of responsible officials:The Department of Community Affairs (DCA) now has a staff member in place with assigned responsibility for the FFATA reporting in the Federal Subaward Reporting System (FSRS) and other required federal reporting. To ensure that all required reporting in FSRS is completed timely, the process and procedures will be fully documented and the LIHEAP program manager will verify completion each month. DCA will also hire additional staff or cross-train current staff to further support the federal reporting function.
Reference Number:2022-018Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Cash ManagementType of Finding:Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Per 2 CFR 200.302, each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) was not able to provide documentation that drawdown requests had been properly approved.Context:Two of eight drawdown requests selected did not have evidence of supervisory approval prior to submission of the requests to the federal agency. The amounts drawn down for the two samples were $282,956 and $74,916 respectively.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that drawdown requests were reviewed and approved prior to submission. Internal controls did not prevent or detect the errors.Effect:Without proper review and approval of drawdown requests, the amounts requested could be inaccurate which could result in the Department receiving program funds to which it is not entitled.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that cash drawdowns are reviewed and approved prior to submission to the federal agency.Views of responsible officials:The Department of Community Affairs (DCA) staff responsible for the LIHEAP cash management function retired prior to this audit period without a proper transition of these tasks and there was also a delay in refilling the position. As recommended, the DCA has reviewed current procedures and controls regarding cash drawdown approvals and has developed a Policy Memo that details the Payment Management System (PMS) drawdown procedures going forward. For each request made, a Contract Administrator will produce a Business Object report for all transactions to be included in the drawdown and will send the report to the Program staff for review and approval that the amounts contained in the report are correct. Once the Program staff review is complete, the approved Business Object report will be forwarded with a cover email to the Division Fiscal Unit staff responsible for drawing down the funds in PMS for final processing.Views of responsible officials:
Reference Number:2022-019Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Community AffairsFederal Program:Low-Income Home Energy Assistance, COVID-19 - Low-Income Home Energy AssistanceAssistance Listing Number:93.568Award Number and Year:2102NJE5C6 (3/11/21 ? 9/30/22), 2001NJE5C3 (3/27/20 ? 9/30/21), G-1701NJLIEA (10/1/16 ? 9/30/18), G-1801NJLIEA (10/1/17 ? 9/30/19), 2202NJLIEA (10/1/21 ? 9/30/22), 2001NJLIEA (10/1/19 ? 9/30/22), 2102NJLIEA (10/1/20 ? 9/30/21)Compliance Requirement:Reporting ? Performance and Special ReportingType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: LIHEAP Performance Data Form (OMB No 0970-0449) ? State grantees must submit this report by January 31st regarding the prior federal fiscal year. The first section of the report is the Grantee Survey that covers sources and allocation of funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service.Carryover and Reallotment Report (OMB No. 0970-0106) ? Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported.Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) ? As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Indian tribes are required to report only on the number of households served for each program component.Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Community Affairs (Department) did not submit performance and special reports timely. The LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted after their respective due dates.Context:We selected for testing the LIHEAP Performance Data Form, the LIHEAP Carryover and Reallotment Report, and the Annual Report on Households Assisted by LIHEAP which were due during FY2022. The following exceptions were noted:? One of one LIHEAP Performance Data Forms was not submitted timely. The report for the period ending 9/30/2021 was due by 1/31/2022 but was not submitted until 4/22/2022, or 81 days late.? One of one LIHEAP Carryover and Reallotment Reports was not submitted timely. The report was due by 8/1/2021, but was not submitted until 11/16/2021, or 107 days late.Questioned costs:None noted.Cause:The Department?s procedures were not sufficient to ensure that the LIHEAP Performance Data Form and the LIHEAP Carryover and Reallotment Report were submitted timely. Internal controls did not prevent or detect the errors.Effect:Delays in submission of annual performance and special reports could impact the Federal agency?s ability to manage the program, could result in delays in annual awards, and possible penalties or sanctions could be imposed by the grantor.Recommendation:We recommend that the Department review and enhance its procedures and internal controls to ensure that performance and special reports are submitted timely.Views of responsible officials:All performance and special reports noted in the audit finding must be approved by the Applied Public Policy Research Institute for Study and Evaluation (APPRISE - U.S. Department of Health and Human Services (USDHHS) Consultants) before they are submitted to USDHHS. The final reports noted as exceptions were not submitted on time due to pandemic related complications, staff retirements and communication issues with APPRISE. As recommended, the Department of Community Affairs (DCA) has reviewed current reporting procedures and Program staff will be assigned the responsibility to prepare all reports, work with APPRISE to obtain required approvals, and submit the all required reports on a timely basis. Reporting due dates and deadlines will be documented to ensure that initial reports are produced timely. The timeframe needed to coordinate with the APPRISE consultants for reviews and updates to the reports will also be built into the process so that final reports are submitted to USDHHS by the due date. All reporting procedures will be documented and distributed to LIHEAP program staff.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-020Prior Year Finding:NoFederal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:CCDF Cluster, COVID-19 ? CCDF ClusterAssistance Listing Number:93.575, 93.596Award Number and Year:2201NJCCDF (10/1/2021 ? 9/30/2024)2201NJCCDD (10/1/2021 ? 9/30/2024)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2020 ? 9/30/2023)2101NJCCDF (10/1/2019 ? 9/30/2022)2001NJCCDF (10/1/2019- 9/30/2022)2101NJCSC6 (10/1/2020 ? 9/30/2023)Compliance Requirement:Reporting ? Federal Funding Accountability and Transparency Act (FFATA)Type of FindingMaterial Weakness in Internal Control Over Compliance, Material Non-complianceCriteria or specific requirement:Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements.The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. ?? 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.)Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:Subaward information was not reported to FSRS during FY 2022.Context:Zero of eight subrecipients selected for testing were reported to FSRS during FY 2022. Total subawards tested were $27,226,331, and $0 was reported as required by FFATA requirements.SEE SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR CHART/TABLECause:The Department was unaware of FFATA reporting requirements and did not report subaward information to FSRS during FY 2022.Effect:Subawards were not reported to FSRS in accordance with FFATA requirements.Questioned costs:None noted.Recommendation:We recommend that the Department develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the Department develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS no later than the end of the month following the month of issuance.Views of responsible officials:The DHS Division of Family Development (DFD) agrees with the audit finding regarding the submission of subawards to the FFFATA Subaward Reporting System (FSRS).In accordance with the finding recommendation, the DFD will develop internal controls and procedures to ensure the timely reporting of all required subawards to FSRS. An initial review of the FSRS by DFD fiscal staff appeared to indicate that some federal grant data that should be prepopulated on the website was missing (e.g. Child Care M&M available; discretionary not found). DFD will work with the necessary federal agencies to ensure that the Division can input the required information for all awards.Assessment and development of policy and procedures related to this task will take approximately three months. Staff assignment, training, and submission of federal grant information to the federal website will occur over the next State fiscal year 2024.Projected policy and procedures development completion: July 1, 2023.Assignment and submission of federal reports: June 30, 2024.
Reference Number:2022-021Prior Year Finding:NoFederal Agency:Department of Health and Human ServicesState Agency:Department of Children and FamiliesFederal Program:Social Services Block GrantAssistance Listing Number:93.667Award Number and Year:G-2200NJSOSR (10/1/2021 ? 3/30/2023)Compliance Requirement:Period of PerformanceType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award?s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods. Social Services Block Grant funds must be expended by the state in the fiscal year allotted or in the succeeding fiscal year.Control ? Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Children and Families (Department) charged costs to the program that were incurred outside of the grant award?s period of performance.Context:Four of forty expenditure transactions selected for testing, totaling $842, were incurred prior to the award start date of October 1, 2021.Questioned costs:$842, the total of expenditures charged to the program that were incurred outside of the grant award?s period of performance.Cause:Accounting staff identified and charged program costs to the incorrect grant. The Department?s review process did not detect the errors nor take timely corrective action.Effect:The Department was not compliant with the grant?s period of performance which could result in the grantor?s disallowance of the costs.Recommendation:We recommend that the Department review and enhance its procedures and controls to ensure that expenditures charged to the program are incurred within the grant?s period of performance.Views of responsible officials:The Department of Children and Families (DCF) will review and enhance its procedures and controls to ensure that expenditures charged to the program are incurred within each grant award?s specified period of performance.Further, as the federal SSBG grant award cited has a period of performance that remains open through September 2023, DCF has adjusted the four transactions that were posted incorrectly to another available funding source and ensured that all transactions presently recorded are now in compliance and within the specified period of performance.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-022Prior Year Finding:2021-019Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Managed Care Financial AuditType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: Two types of audits are required for managed care:1. Audited Financial Reports ? The contract with each Managed Care Organization (MCO), Prepaid Inpatient Health Plan (PIHP), and Prepaid Ambulatory Health Plan (PAHP) must require them to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. These audits must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards (42 CFR section 438.3(m)).2. Periodic Audits ? Effective no later than for rating periods for contracts starting on or after July 1, 2017, the state must periodically, but no less frequently than once every three years, conduct, or contract for an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of each MCO, PIHP, and PAHP and post the results of these audits on its website (42 CFR section 438.602(e) and (g); May 6, 2016, Federal Register (81 FR 27497); OMB No. 0938-0920).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Human Services (Department) received audit reports from its MCOs, but these reports were Agreed Upon Procedures (AUP) reports which were not conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Context:Five of five MCO audit reports received by DMAHS were AUP reports. An AUP engagement is one in which a practitioner is engaged by a client to issue a report of findings based on specific procedures performed on subject matter. The client engages the practitioner to assist specified parties in evaluating subject matter or an assertion as a result of a need or needs of the specified parties.In an engagement performed under this section, the practitioner does not perform an examination or a review, and does not provide an opinion or negative assurance. Therefore, AUP reports do not fulfill the requirement that the audit is conducted in accordance with generally accepted accounting principles and generally accepted auditing standards.Questioned costs:Undetermined.Cause:The Department held the opinion that AUP reports were sufficient to meet the requirement of obtaining a financial statement audit report per the flexibility given to States in Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10, dated November 10, 2016.Effect:The Department is unable to ensure that its MCOs were audited in accordance with generally accepted accounting principles and generally accepted auditing standards. Failure to obtain qualified audit reports from its MCOs would result in DMAHS being unaware of deficiencies, corrective action plans or unmet requirements which would be identified as a result of qualified audits.Recommendation:We recommend that The Department update its contracts with its MCOs to remove the language specifying the requirement for an audit conducted specifically in accordance with generally accepted accounting principles and generally accepted auditing standards and instead to specify that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.Views of responsible officials:Based on this audit finding recommendation, Section 7.25.1(B) of the MCO Contract has been updated effective January 2023. The update removes language requiring audits in accordance with generally accepted accounting principles and generally accepted auditing standards and specifies that an AUP report is acceptable per guidance provided under Medicaid and CHIP Managed Care Final Rule (CMS-2390-F) Frequently Asked Question number Q10.
Reference Number:2022-023Prior Year Finding:2021-014Federal Agency:U.S. Department of Health and Human ServicesState Agency:Department of Human ServicesFederal Program:Medicaid Cluster, COVID-19 - Medicaid ClusterAssistance Listing Number:93.775, 93.777, 93.778Award Number and Year:2205NJ5MAP (10/1/2021 ? 9/30/2022)2205NJ5ADM (10/1/2021 ? 9/30/2022)Compliance Requirement:Special Tests and Provisions: Provider EligibilityType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance: In order to receive Medicaid payments, providers must: (1) be licensed in accordance with federal, state, and local laws and regulations to participate in the Medicaid program (42 CFR sections 431.107 and 447.10; and Section 1902(a)(9) of the Social Security Act (42 USC 1396a(a)(9)); (2) screened and enrolled in accordance with 42 CFR Part 455, Subpart E (sections 455.400 through 455.470); and make certain disclosures to the state (42 CFR Part 455, Subpart B, sections 455.100 through 455.106). Medicaid managed care network providers are subject to the same disclosure, screening, enrollment, and termination requirements that apply to Medicaid fee-for-service providers in accordance with 42 CFR Part 438, Subpart H. Providers who have been barred from participation by the Office of the Inspector General (OIG) exclusion list are not eligible to be enrolled in the Medicaid program. (See 42 CFR 455.436).Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Health and Human Services (the Department) did not maintain documentation to support provider eligibility to participate in the Medicaid program. The provider eligibility requirement is administered by a 3rd-party that is required to determine and document the provider?s eligibility with the Department?s requirements. Provider files were incomplete, containing expired licenses or missing key documentation supporting eligibility.Context:The Department contracts with a 3rd party provider to manage medical provider eligibility. The 3rd party provider is responsible for verifying providers? license statuses and that providers meet health and safety standards. We noted that medical provider files maintained by the 3rd party contractor did not consistently support providers? eligibility and compliance with the State?s health and safety standards in accordance with federal and state requirements. A sample of 60 provider files was selected for testing and the following exceptions were noted:? Six of sixty provider files did not have an active license on file. The provider licenses expired and an active license was not obtained and updated in the provider files.? One of sixty provider files did not contain the provider agreement checklist.Questioned costs:Undetermined.Cause:Internal controls of the 3rd party provider were ineffective in ensuring that all required documentation was obtained and maintained in provider files. The Department?s controls over the 3rd party contractor were ineffective in detecting the errors.Effect:Medicaid claims may be paid to ineligible providers which may result in unallowed program costs. The Department is not compliant with the State?s plan for Medicaid.Recommendation:We recommend that the Department continue to review the 3rd party provider?s procedures for determining and documenting provider eligibility and compliance with related State and Federal requirements. The Department should periodically review provider files to determine if all required documentation is maintained in the files.Views of responsible officials:The Department of Human Services? Division of Medical Assistance and Health Services (DMAHS) has unsuccessfully attempted to gain access to data files that would provide current licensure data to our contracted vendor from the State?s licensing agencies. Continuing efforts to outreach providers by sending a license expiration letter to providers 45 days prior to the license expiration date have also been less than successful. Access concerns have discouraged the State?s efforts to deny claims because of expired licenses. It is important to note that the State?s expectations are that providers are properly licensed, but have failed to communicate this information to our contracted vendor. Licensure information for all enrolling providers and those subject to revalidation are also screened in accordance with ACA requirements.DMAHS efforts to achieve compliance with regard to provider licensing in coordination with the State?s contracted vendor remains ongoing and the importance of having license information on file for the providers being enrolled will again be reiterated and reinforced through communications with the contracted vendor and their staff. The vendor has also been approved to continue taking screenshots of providers? licensing information from licensing websites in lieu of the provider sending in paper copies. These ongoing efforts and actions will help to ensure that licensing information is captured and maintained for each provider and the State?s compliance with documenting provider licensing continues to improve and move towards full compliance in future periods.
Reference Number:2022-024Prior Year Finding:NoFederal Agency:Social Security AdministrationState Agency:Department of Labor and Workforce DevelopmentFederal Program:Disability Insurance/SSI ClusterAssistance Listing Number:96.001Award Number and Year:04-2204NJD100 (10/1/2021 ? 3/30/2023), 04-2104NJD100 (10/1/2020 ? 3/30/2022), 04-2004NJD100 (10/1/2019 ? 3/30/2021)Compliance Requirement:Period of PerformanceType of FindingSignificant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement:Compliance ? A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award?s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods.Control ? Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).Condition:The Department of Labor and Workforce Development (Department) charged costs to the program that were incurred outside of the grant award?s period of performance.Context:Two of six expenditure transactions selected for testing, totaling $435, were incurred prior to the award start date of October 1, 2021.Questioned costs:$435, the total of expenditures charged to the program that were incurred outside of the grant?s period of performance.Cause:Accounting staff identified and charged program costs to the incorrect grant. The Program?s review process did not detect the errors nor take timely corrective action.Effect:The Department was not compliant with the grant?s period of performance which could result in the grantor?s disallowance of the costs.Recommendation:We recommend that the Department review its procedures to ensure that expenditures charged to the program are incurred within the grant?s period of performance.Views of responsible officials:The New Jersey Department of Labor and Workforce Development (DLWD) has a policy in place for processing tuition reimbursements that are performed by the Department?s Accounts Payable unit. The policy was reviewed by the Office of Finance & Accounting (F&A) and internal control procedures were enhanced to ensure that fiscal cutoff measures were appropriately addressed. Tuition reimbursement procedures include having the requests forwarded to the responsible Supervising Analyst in the Appropriations/Accounting unit for final review and approval to ensure the proper fiscal period is charged. The correcting transactions were completed during the Single Audit timeframe to remediate the findings by charging and reimbursing the proper fiscal year accounts. The DLWD will continue its efforts to ensure compliance and that all charges applied to Federal awards are within the specified period of performance going forward.