Audit 369207

Criteria According to 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain internal controls over federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Condition During the testing of eligibility, the auditor identified one instance where proper eligibility information was not maintained within the client files. Specifically, the individual was marked as married on their initial application but was marked as single on their renewal and there was no support within the file to determine which was correct. Cause The primary cause of the error identified was lack of administrative oversight and a lack of effective control activities such as effective review procedures and monitoring. Effect The Organization granted a notice of eligibility without the required supporting documentation and/or proper approval. Questioned Costs Not applicable Context Prior to a notice of eligibility (NOE) being granted, it must be verified that the individual has a valid proof of HIV diagnosis, be considered low-income based on household size, and be a resident of the state in which they are applying in. Eligibility documentation should be retained in the client file. Out of the sample of 40 client files tested, we noted one individual who did not have all requirements within their file. This individual did not have adequate support for the household size of one to calculate low-income status. BASIC NWFL, Inc. was able to obtain the support that the individual was indeed married and the form was completed incorrectly. After the income was recalculated with the spouse’s income, it was determined that the individual still met the low-income threshold. Recommendation We recommend the client implement controls to ensure all eligibility documentation is obtained and properly reviewed before granting eligibility. This includes providing regular staff training and conducting periodic internal audits to ensure compliance. Views of Responsible Officials See corrective action plan.