2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?005 TRANSPARENCY ACT REPORTING (Repeat of Prior Year Finding 2021?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/State?s Program and Non-Entitlement Gants in Hawaii 14.228/ COVID-19 14.228 Grant Award B14DC540001 Grant Award B16DL540001 #2 Grant Award B15DC540001 Grant Award B16DC540001 Grant Award B17DC540001 Grant Award B18DC540001 Grant Award B19DC540001 Grant Award B20DC540001 Grant Award B20DW540001 Grant Award B21DC540001Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that the reports were not submitted by the State of West Virginia Community Development Block Grant program management within the timeframe designated in 2 CFR 170 Appendix A. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the CDBG program included 22 subawards that totaled $15,177,456 for the year ended June 30, 2022. The five subawards tested that were not reported to the FFATA Subaward Reporting System timely was $7,119,797. Total expenditures for the CDBG program were $25,867,297 for the year ended June 30, 2022. Cause: A lack of oversight and adequate review of the FFATA reporting requirements by CDBG management caused the reports required for first tier subawards over $30,000 to not be submitted timely to the FFATA Subaward Reporting System, and to have missing/incorrect information reported. Effect: CDBG management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System accurately or in a timely fashion Recommendation: We recommend that CDBG management take immediate action to ensure compliance with the reporting requirements of the FFATA, which includes the timely submission of the reports and accurate information Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?005 TRANSPARENCY ACT REPORTING (Repeat of Prior Year Finding 2021?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/State?s Program and Non-Entitlement Gants in Hawaii 14.228/ COVID-19 14.228 Grant Award B14DC540001 Grant Award B16DL540001 #2 Grant Award B15DC540001 Grant Award B16DC540001 Grant Award B17DC540001 Grant Award B18DC540001 Grant Award B19DC540001 Grant Award B20DC540001 Grant Award B20DW540001 Grant Award B21DC540001Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that the reports were not submitted by the State of West Virginia Community Development Block Grant program management within the timeframe designated in 2 CFR 170 Appendix A. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the CDBG program included 22 subawards that totaled $15,177,456 for the year ended June 30, 2022. The five subawards tested that were not reported to the FFATA Subaward Reporting System timely was $7,119,797. Total expenditures for the CDBG program were $25,867,297 for the year ended June 30, 2022. Cause: A lack of oversight and adequate review of the FFATA reporting requirements by CDBG management caused the reports required for first tier subawards over $30,000 to not be submitted timely to the FFATA Subaward Reporting System, and to have missing/incorrect information reported. Effect: CDBG management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System accurately or in a timely fashion Recommendation: We recommend that CDBG management take immediate action to ensure compliance with the reporting requirements of the FFATA, which includes the timely submission of the reports and accurate information Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?006 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Repeat of Prior Year Findings 2021?004 and 2020?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.508(b) states, ?The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards.? The Federal Office of Management and Budget issues instructions on how to prepare this schedule. Condition: Workforce West Virginia?s (WWV?s) internal controls are not adequate to ensure that the Schedule of Expenditures Federal Awards (SEFA) accurately reports all federal assistance. It was noted the SEFA was resubmitted due to errors causing untimely submission. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the SEFA reporting processes were not adequately enforced to ensure the SEFA is accurate due to lack of training. Effect: WWV is not properly reporting their federal expenditures and type A programs may not be appropriately identified on a timely basis. Recommendation: We recommend that WWV ensure staff responsible for the preparation of the SEFA have the resources needed to accurately prepare the SEFA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?007 REPORTING, AND MATCHING, LEVEL OF EFFORT, EARMARKING (Repeat of Prior Year Findings 2021?006 and 2020?005) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of four ETA 2112 reports submitted, we noted that during the compliance year, management resubmitted three of the reports due to Workforce West Virginia (WWV) not initially following United States Department of Labor guidance related to program classifications. Additionally, the following reports tested were not reviewed and approved prior to submission: 1) two of the two ETA 2208A reports 2) one of the three ETA 9050 reports 3) two of the four ETA 9052 reports 4) two of the four ETA 9055 reports, and 5) one of the two ETA 9128 reports. In addition, one of the two ETA 9128 reports was revised and submitted by the approver. The review and approval of the ETA 2112 is also the control for the matching compliance requirement. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the individual reporting processes were not adequately enforced or documented. Effect: Reports could be filed with errors or lack of supporting documentation and not be identified by management. The matching requirement may not be met. Recommendation: We recommend that WWV implement internal controls over the report submission process, to ensure each report is reviewed and approved by appropriate individuals familiar with the reporting requirements to ensure that accurate information is reported. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?008 INTERNAL CONTROLS OVER INFORMATION TECHNOLOGY (Repeat of Prior Year Findings 2021?005 and 2020?003) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Workforce West Virginia?s (WWV?s) does not perform periodic documented reviews of administrator access changes to the Automated Benefit Payment System (ABPS) or the Unemployment Compensation Tax applications (UC Tax). A user access review is performed periodically for ABPS and UC Tax, however the review is not documented. WWV does not complete documented periodic user access reviews for the Pandemic Unemployment Assistance (PUA) application. Due to a software change, WWV was unable to provide documentation to determine if terminated employees were communicated timely to the West Virginia Office of Technology (WVOT) to remove access or within the organization to remove access to ABPS, UC Tax, and PUA. Complementary user entity controls defined in the Service Organization Controls (SOC) report from Geographic Solutions, Inc. are not in place at WWV. WWV has not performed periodic disaster recovery testing for WWV owned applications. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the information technology processes were not adequately designed or implemented. Effect: Unauthorized access to critical information systems may occur and not be detected or resolved in a timely manner causing WWV to be in noncompliance. Recommendation: WWV should implement policies and procedures that include monitoring the information systems and systems controls reports. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?009 SPECIAL TESTS AND PROVISION ? UI PROGRAM INTEGRITY - OVERPAYMENTS (Repeat of Prior Year Findings 2021?007 and 2020?004) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During fiscal year 2022, the Workforce West Virginia (WWV) overpaid unemployment claims out of funds from the Unemployment Program and the Pandemic Unemployment Assistance Program (PUA). PUA is federal funding provided through the CARES Act to pay unemployment claims for self-employment individuals and independent contractors. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. For three of the 60 overpayments, incomplete documentation did not indicate overpayment classification. For 10 of the 60 overpayments, documentation required by WWV?s policies could not be provided. Cause: WWV?s normal control procedures require proper documentation to be complete for the deputy?s review and approval to complete an overpayment determination and prior to notification to the claimant. However, WWV did not follow policy in retaining required documentation to support deputy decisions for overpayments. Effect: WWV is not following policies and procedures established to identify overpayments and classify them in a manner that allows the state to take appropriate follow-up actions. Recommendation: WWV should enforce appropriate procedures to ensure documentation of review and approval and required forms with deputy decisions is maintained for each overpayment. procedures. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?010 REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds 21.027Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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).? The terms and conditions of the award require the recipient to submit reports as the Secretary of the U.S. Department of Health and Human Services (HHS) determines are needed to ensure compliance with conditions that are imposed on the payment, and such reports shall be in such form, with such content, as specified by the secretary of HHS in future program instructions directed to all recipients. Condition: The ad hoc extract report of state revenue that was used in calculation of revenue replacement included incorrect data. Questioned Costs: N/A Context: The ad hoc extract report of state revenue for calendar year 2020 included fiscal years 2020 and 2021 data. The revenue replacement calculation consists of comparison of actual calendar year revenues to counterfactual revenue (based on the formula prescribed in the Final Rule). Cause: Management?s internal controls were not appropriately designed to ensure that data used for the revenue replacement calculation is accurate. Effect: The revenue replacement calculations could be inaccurate or incomplete. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Management should ensure the precision of the internal controls over the review of the data used in the revenue replacement calculation identify material errors in the data in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?019 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Rehabilitation Services?Vocational Rehabilitation Grants to State 84.126 Grant Award H126A200095, H126A210095, H126A220095 Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Division of Rehabilitation Services (WVDRS) did not have evidence of the review control related to cash management. One of the five drawdowns selected for testing did not have Director approval to draw the funds down. Questioned Costs: N/A Context: Total federal expenditures for the Vocational Rehabilitation Grant were $31,508,101 for the year ended June 30, 2022. Cause: WVDRS appears to have policies and procedures in place to review the draws prior to requesting; however, the policies and procedures were not followed for this draw. Effect: WVDRS could have drawn down the incorrect amount of federal funds. Recommendation: We recommend that WVDRS enforce the existing policies and procedures surrounding the review and approval of the cash draws prior to requesting the funds. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2022?020 REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Rehabilitation Services?Vocational Rehabilitation Grants to State 84.126 Grant Award H126A200095, H126A210095, H126A220095Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.302(b)(2) ?Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. If a Federal awarding agency requires reporting on an accrual basis from a recipient that maintains its records on other than an accrual basis, the recipient must not be required to establish an accrual accounting system. This recipient may develop accrual data for its reports on the basis of an analysis of the documentation on hand. Similarly, a pass-through entity must not require a subrecipient to establish an accrual accounting system and must allow the subrecipient to develop accrual data for its reports on the basis of an analysis of the documentation on hand.? Condition: The West Virginia Division of Rehabilitation Services (WVDRS) is responsible for preparing the Rehabilitation Services Administration (RSA-17), Federal Financial Report, quarterly. The RSA-17 is used to track the status of financial data tied to a particular Federal Grant Award. The RSA-17 report should be complete, accurate, and prepared in accordance with the required accounting basis. There was an error in reporting where certain amounts reported did not agree to the underlying data used to prepare the reports. The Director?s review was not precise enough to detect the error. Questioned Costs: N/A Context: Total federal expenditures for the Vocational Rehabilitation Grant were $31,508,101 for the year ended June 30, 2022. Cause: WVDRS has policies and procedures in place to review the RSA-17 prior to submission; however, the review was not precise enough to identify the errors. Effect: Incorrect data could be reported to the RSA. Recommendation: We recommend that WVDRS enforce the existing policies and procedures surrounding the review and approval of the RSA-17 report prior to submission. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?027 INTERNAL CONTROLS OVER SPECIAL TESTS AND PROVISIONS ? CHILD SUPPORT NON-COOPERATION, PENALTY FOR REFUSAL TO WORK, AND ADULT CUSTODIAL PARENT OF CHILD UNDER SIX WHEN CHILD CARE NOT AVAILABLE (Repeat of Prior Year Findings 2021?028, 2020?025, 2019?025, 2018?019, 2017?010, 2016?016, 2015?024, 2014?018, 2013?036, 2012?56, 2011?44, and 2010?41) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the issuance and removal of sanctions; however, adequate documentation to test and determine that the controls were operating effectively was not consistently maintained or available. Questioned Costs: N/A Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: Internal controls are not operating effectively surrounding the issuance or removal of sanctions against TANF recipients. Effect: Recipient benefits may potentially be reduced or increased in error or without appropriate cause. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review prior to the issuance or removal of sanctions. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?028 SPECIAL TESTS AND PROVISIONS ? INCOME ELIGIBILITY AND VERIFICATION SYSTEM (Repeat of Prior Year Findings 2021?029 and 2020?026) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Each state shall participate in the Income Eligibility and Verification System (IEVS) required by Section 1137 of the Social Security Act as amended. Under the state plan the state is required to coordinate data exchanges with other federally assisted benefit programs, request and use income and benefit information when making eligibility determinations and adhere to standardized formats and procedures in exchanging information with other programs and agencies. Specifically, the state is required to request and obtain information as follows (42 USC 1320b-7; 45CFR section 205.55). (a) Wage information from the state Wage Information Collection Agency (SWICA) should be obtained for all applicants at the first opportunity following receipt of the application, and for all recipients on a quarterly basis. (b) Unemployment Compensation (UC) information should be obtained for all applicants at the first opportunity, and in each of the first three months in which the individual is receiving aid. This information should also be obtained in each of the first three months following any recipient-reported loss of employment. If an individual is found to be receiving UC, the information should be requested until benefits are exhausted. (c) All available information from the Social Security Administration (SSA) for all applicants at the first opportunity. (d) Information from the U.S. Citizenship and Immigration Services and any other information from other agencies in the state or in other states that might provide income or other useful information. (e) Unearned income from the Internal Revenue Service (IRS). Condition: During testing of 40 TANF cases subject to IEVS, we noted the following: Control - For 40 of the 40 cases selected for control testing, adequate documentation of review of the data exchanges, and system matches, and review of actions taken by the caseworker when required was not provided. Compliance- For 13 of the 40 cases selected for testing, the recipient did not appear to be receiving WVWorks benefits. The auditor was unable to determine if these cases should have been subject to a data match under TANF. For three of the 40 cases selected for testing, the recipient appeared to be receiving WVworks benefits, and a data match indicating caseworker action required was noted, but no action was completed. Additionally, additional documentation supporting no action required for the match was not available. For the remaining 24 of the 40 cases, the recipient appeared to be receiving WVWorks, a data match occurred, and related worker action was taken, but documentation supporting the action was not available. In addition, the auditor could not determine if specific action items were completed relating to individual exchange types. Questioned Costs: Unknown Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: There are insufficient internal controls in place surrounding the generation and review of populations provided to the auditor, the Income Eligibility and Verification System matches, and the caseworker actions required within the Recipient Automated Payment Information Data System (RAPIDS). Also, insufficient documentation surrounding matches made between the information systems and actions taken after a match is made. Effect: The State of WV may not be coordinating data exchanges with other federally assisted benefit programs as required by the state plan. Recommendation: We recommend that management implement policies and procedures to ensure that information in RAPIDS and populations are complete and accurate. In addition, we also recommend DHHR evaluate their control over the caseworker action requirement within RAPIDS on matches related to the Income Eligibility and Verification System. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?027 INTERNAL CONTROLS OVER SPECIAL TESTS AND PROVISIONS ? CHILD SUPPORT NON-COOPERATION, PENALTY FOR REFUSAL TO WORK, AND ADULT CUSTODIAL PARENT OF CHILD UNDER SIX WHEN CHILD CARE NOT AVAILABLE (Repeat of Prior Year Findings 2021?028, 2020?025, 2019?025, 2018?019, 2017?010, 2016?016, 2015?024, 2014?018, 2013?036, 2012?56, 2011?44, and 2010?41) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the issuance and removal of sanctions; however, adequate documentation to test and determine that the controls were operating effectively was not consistently maintained or available. Questioned Costs: N/A Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: Internal controls are not operating effectively surrounding the issuance or removal of sanctions against TANF recipients. Effect: Recipient benefits may potentially be reduced or increased in error or without appropriate cause. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review prior to the issuance or removal of sanctions. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?028 SPECIAL TESTS AND PROVISIONS ? INCOME ELIGIBILITY AND VERIFICATION SYSTEM (Repeat of Prior Year Findings 2021?029 and 2020?026) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Each state shall participate in the Income Eligibility and Verification System (IEVS) required by Section 1137 of the Social Security Act as amended. Under the state plan the state is required to coordinate data exchanges with other federally assisted benefit programs, request and use income and benefit information when making eligibility determinations and adhere to standardized formats and procedures in exchanging information with other programs and agencies. Specifically, the state is required to request and obtain information as follows (42 USC 1320b-7; 45CFR section 205.55). (a) Wage information from the state Wage Information Collection Agency (SWICA) should be obtained for all applicants at the first opportunity following receipt of the application, and for all recipients on a quarterly basis. (b) Unemployment Compensation (UC) information should be obtained for all applicants at the first opportunity, and in each of the first three months in which the individual is receiving aid. This information should also be obtained in each of the first three months following any recipient-reported loss of employment. If an individual is found to be receiving UC, the information should be requested until benefits are exhausted. (c) All available information from the Social Security Administration (SSA) for all applicants at the first opportunity. (d) Information from the U.S. Citizenship and Immigration Services and any other information from other agencies in the state or in other states that might provide income or other useful information. (e) Unearned income from the Internal Revenue Service (IRS). Condition: During testing of 40 TANF cases subject to IEVS, we noted the following: Control - For 40 of the 40 cases selected for control testing, adequate documentation of review of the data exchanges, and system matches, and review of actions taken by the caseworker when required was not provided. Compliance- For 13 of the 40 cases selected for testing, the recipient did not appear to be receiving WVWorks benefits. The auditor was unable to determine if these cases should have been subject to a data match under TANF. For three of the 40 cases selected for testing, the recipient appeared to be receiving WVworks benefits, and a data match indicating caseworker action required was noted, but no action was completed. Additionally, additional documentation supporting no action required for the match was not available. For the remaining 24 of the 40 cases, the recipient appeared to be receiving WVWorks, a data match occurred, and related worker action was taken, but documentation supporting the action was not available. In addition, the auditor could not determine if specific action items were completed relating to individual exchange types. Questioned Costs: Unknown Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: There are insufficient internal controls in place surrounding the generation and review of populations provided to the auditor, the Income Eligibility and Verification System matches, and the caseworker actions required within the Recipient Automated Payment Information Data System (RAPIDS). Also, insufficient documentation surrounding matches made between the information systems and actions taken after a match is made. Effect: The State of WV may not be coordinating data exchanges with other federally assisted benefit programs as required by the state plan. Recommendation: We recommend that management implement policies and procedures to ensure that information in RAPIDS and populations are complete and accurate. In addition, we also recommend DHHR evaluate their control over the caseworker action requirement within RAPIDS on matches related to the Income Eligibility and Verification System. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?030 SPECIAL TESTS AND PROVISIONS ? PROVIDER ELIGIBILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 455 Subpart E requires CHIP providers to be licensed in accordance with federal, state, and local laws and regulations to participate in the CHIP program, be screened and enrolled in CHIP, and make certain required disclosures to the state. Condition: During our testing of 60 cases for provider eligibility for CHIP, we noted one instance where a provider selected not to be a CHIP provider, however, was documented as a CHIP provider. We also noted four providers who chose to be terminated as a CHIP provider, however, were still documented as a CHIP provider. We also noted three providers did not have a letter of approval noting provider number or effective date. We also noted one provider that did not have a current license in the file. Questioned Costs: Unknown Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. Cause: Management indicated that the providers were input incorrectly into the system. The appropriate documentation was not provided for the providers that did not have a letter of approval or current license. Effect: Payments may have been made to ineligible providers. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?032 ALLOWABILITY OF EXPENDITURES Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.302(a) states, ?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.? 2 CFR 200.403(g) states costs must ?Be adequately documented.? 2 CFR 200.456 states ?Participant support costs as defined in 200.1 are allowable with the prior approval of the Federal awarding agency.? Condition: During our testing of the allowability it was noted that for four out of 60 tested, the West Virginia Department of Health and Human Resources (WVDHHR) did not perform the quarterly updates to the wage index for the Outpatient Prospective Payment System (OPPS). Questioned Costs: $841.58 ? Assistance Listing #93.767 Context: The four expenditures represent $841 of the 60 expenditures selected for testing of $140,069. The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. Cause: WVDHHR did not update wage index for OPPS payments for four of the 60 expenditures. Effect: Incorrect payments may have been made for procedure codes. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?033 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the CHIP contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. Condition: During our testing of the audited financial reports of the CHIP contract required to be submitted by Managed Care Organizations (MCOs), it was noted that none of the MCOs submitted audited financial reports. There are three MCOs and all three of the MCOs were selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: Management indicated that the audited financial statements had not been obtained. Management indicated that they were in the process of implementing procedures around financial reporting for the MCOs. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that the financial audits are obtained and documentation of review and approval of the financial audits is maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?034 ELIGIBILITY (Repeat of Prior Year Finding 2021?037) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 42 CFR 435.914 states ?(a) The agency must include in each applicant's case record facts to support the agency's decision on his application. (b) The agency must dispose of each application by a finding of eligibility or ineligibility, unless?(1) There is an entry in the case record that the applicant voluntarily withdrew the application, and that the agency sent a notice confirming his decision; (2) There is a supporting entry in the case record that the applicant has died; or (3) There is a supporting entry in the case record that the applicant cannot be located.? 42 CFR 457.965 states ?The State must include in each applicant's record facts to support the State's determination of the applicant's eligibility for CHIP.? 42 CFR 435.945(j) and 457.380(j) require states to develop and submit to the Centers for Medicaid and Medicare Services (upon request) a plan describing the Medicaid and CHIP eligibility verification policies and procedures adopted by the State. The State of West Virginia Modified Adjusted Gross Income (MAGI)-Based Eligibility Verification Plan for Medicaid & CHIP requires the following eligibility factors to be verified: income, residency, age, social security number, citizenship, immigration status, household composition, pregnancy, caretaker relative, Medicare, application for other benefits, and other insurance coverage. These are either required to be verified through electronic data sources or through self-attestation without additional verification or self-attestation with post-eligibility verification. Electronic data sources include: the Internal Revenue Service, Social Security Administration, State Wage Information Collection Agency, State Unemployment Compensation, State Administered Supplementary Payment Program, State General Assistance Programs, Supplemental Nutrition Assistance Program, Temporary Assistance for Needy Family, Bureau for Child Support Enforcement, State Income Tax, TALX, Work Force West Virginia and Families and Children Tracking System Income. State verification plans does not provide specific details. The most recently submitted plan for the State is posted on Medicaid.gov. Condition: During our testing of 60 cases for eligibility for CHIP, we noted one instance where the social security number, age, date of birth, and immigration status was not verified in the Data Exchange System as required by the State?s MAGI-based CHIP eligibility verification plan; and nine instances where income was not verified. Questioned Costs: $4,104 ? Assistance Listing #93.767 Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The nine cases with questioned costs represent $4,104 of CHIP payments out of a population of benefit payments tested for eligibility of $199,490. Cause: Management indicated that the information was verified in accordance with the CHIP verification plan or State plan, but no documentation was kept in the file of the verification. Effect: Payments may have been made for ineligible recipients. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. DHHR implemented an eligibility system enhancement on April 17, 2021, to retain historical record of verification of financial information obtained from the Federal Data Services Hub. We recommend that DHHR continue to follow the new policies and procedures. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?038 SUBRECIPIENT CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1 Grant Award 1H79TI081724-01 Grant Award 6H79TI083313Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.305(b)(1) requires that the non-federal entity must ?monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient.? Per DHHR policy, the Spending Unit shall limit cash advances to a subrecipient to the minimum amounts needed and be timed in accordance with the actual, immediate cash requirements of the subrecipient for carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the subrecipient for direct program or project costs and the proportionate share of any allowable indirect costs. Condition: During our testing of the State Targeted Response to the Opioid Crisis Grants, the West Virginia Department of Health and Human Resources (DHHR) was unable to provide adequate documentation supporting why the subrecipient drawdowns were approved for payment for three of the 40 drawdowns selected for testing. The supporting documentation for the draw down showed less expenses than the amount that had been drawn down to date on the grants. The supporting documentation also showed the subrecipients appeared to have adequate cash balances on hand at the time of the request. Questioned Costs: $493,423 Context: The total subrecipient drawdowns selected for testing was $3,521,390. The total amount of subrecipient drawdowns for the Opioid STR program during fiscal year 2022 was $38,332,337. Cause: Documentation to support the amount paid to the subrecipient was not retained by DHHR. In addition, supporting documentation was not retained to demonstrate cash advances to the subrecipient represented the minimum amount needed for actual and immediate cash requirements of the subrecipient for carrying out the purpose of the program. Effect: The cash remitted to the subrecipient may not be accurate and may be in excess of the subrecipients actual and immediate cash requirements for carrying out the purpose of the program. Recommendation: We recommend that DHHR establish policies and procedures requiring documentation from subrecipients substantiating that the amount of a drawdown is appropriate based on the expenditures through the request date so that the reconciliation preformed for the related drawdown is sufficient to determine that the drawdown is appropriate and excess cash is not remitted to the subrecipient. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?039 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1 Grant Award 1H79TI081724-01 Grant Award 6H79TI083313Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that one report was not submitted by the State of West Virginia Opioid STR (DHHR) program management within the timeframe designated in 2 CFR 170 Appendix A, and one report had an incorrect subaward amount. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the Opioid STR program included 183 subawards which had payments that totaled $38,332,337 for the year ended June 30, 2022. The federal expenditures for the Opioid STR program for fiscal year ended June 30, 2022, were $42,026,455. Cause: A lack of oversight and adequate review of the FFATA reporting by DHHR management. Effect: DHHR management did not report the necessary FFATA report for Opioid STR first-tier subawards over $30,000 to The FFATA Subaward Reporting System in a timely fashion for one report and for one report, the wrong amount was reported for the subaward. Recommendation: We recommend that DHHR strengthen internal controls and policies and procedure over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?040 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1Criteria: 2 CFR 200.303 requires that non-Federal entities must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Division of Corrections and Rehabilitation?s internal controls are not adequate to ensure the Schedule of Expenditures of Federal Awards (SEFA) accurately reports all federal assistance. Our review of the Division?s SEFA for fiscal year 2022 identified that total expenditures under the Opioid STR program were overstated by $805,327. Questioned Costs: N/A Context: The total federal expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455. Cause: The internal controls over the SEFA reporting processes were not operating effectively to ensure the SEFA is accurate. Effect: The Division of Corrections and Rehabilitation is not properly reporting their federal expenditures and major programs may not be appropriately identified on a timely basis. Recommendation: We recommend that the Division ensure staff responsible for the preparation of the SEFA have the resources needed to accurately prepare the SEFA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?042 REPORTING (Repeat of Prior Year Finding 2021?041) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 170.200 indicates that ?federal awarding agencies are required to publicly report federal awards that equal or exceed the micro-purchase threshold and publish the required information on a public-facing, OMB-designated, government-wide website and follow OMB guidance to support Transparency Act implementation.? Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA), as amended by Section 6202 of Public Law 110-252, 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). Condition: For 17 of the 29 subawards selected for testing, the West Virginia Division of Emergency Management (DEM) was not in compliance with FFATA reporting requirements. The following table summarizes the exceptions noted during testing. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 29 2 10 4 17 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $25,528,869 $3,161,818 $5,291,334 $5,969,564 $9,899,382 Questioned Costs: N/A Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: DEM does not have adequate internal controls and policies and procedures in place to ensure that subawards of $30,000 or more are being reported timely and accurately to FSRS. Effect: DEM is not reporting accurate and timely information for first-tier subawards of $30,000 or more causing them not to be in compliance with federal reporting requirements. Recommendation: We recommend that DEM strengthen internal controls and policies and procedures over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?043 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.332(b) requires that all pass-through entities must: (b) 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 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; and (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). Condition: We noted that the DEM did not perform a subrecipient risk assessment. Therefore, DEM was unable to provide documentation supporting that the level of monitoring to be completed for each subrecipient was appropriate based on the risk assessment. DEM only monitored two subrecipients during the year due to limited staffing and no risk assessment being performed. Questioned Costs: Unknown Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: Although DEM has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year, subrecipient risk assessments were not completed and an adequate number of subrecipients were not monitored. Effect: DEM does not have proper internal controls in place to ensure policies and procedures surrounding the subrecipient monitoring compliance requirements are in effect. DEM does not have evidence to support appropriate subrecipient monitoring; therefore, management may not be able to identify issues in a timely manner. Recommendation: We recommend that DEM review policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure they are in compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?042 REPORTING (Repeat of Prior Year Finding 2021?041) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 170.200 indicates that ?federal awarding agencies are required to publicly report federal awards that equal or exceed the micro-purchase threshold and publish the required information on a public-facing, OMB-designated, government-wide website and follow OMB guidance to support Transparency Act implementation.? Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA), as amended by Section 6202 of Public Law 110-252, 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). Condition: For 17 of the 29 subawards selected for testing, the West Virginia Division of Emergency Management (DEM) was not in compliance with FFATA reporting requirements. The following table summarizes the exceptions noted during testing. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 29 2 10 4 17 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $25,528,869 $3,161,818 $5,291,334 $5,969,564 $9,899,382 Questioned Costs: N/A Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: DEM does not have adequate internal controls and policies and procedures in place to ensure that subawards of $30,000 or more are being reported timely and accurately to FSRS. Effect: DEM is not reporting accurate and timely information for first-tier subawards of $30,000 or more causing them not to be in compliance with federal reporting requirements. Recommendation: We recommend that DEM strengthen internal controls and policies and procedures over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?043 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.332(b) requires that all pass-through entities must: (b) 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 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; and (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). Condition: We noted that the DEM did not perform a subrecipient risk assessment. Therefore, DEM was unable to provide documentation supporting that the level of monitoring to be completed for each subrecipient was appropriate based on the risk assessment. DEM only monitored two subrecipients during the year due to limited staffing and no risk assessment being performed. Questioned Costs: Unknown Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: Although DEM has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year, subrecipient risk assessments were not completed and an adequate number of subrecipients were not monitored. Effect: DEM does not have proper internal controls in place to ensure policies and procedures surrounding the subrecipient monitoring compliance requirements are in effect. DEM does not have evidence to support appropriate subrecipient monitoring; therefore, management may not be able to identify issues in a timely manner. Recommendation: We recommend that DEM review policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure they are in compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?002 SPECIAL TESTS AND PROVISIONS ? ADP SYSTEM FOR SNAP Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479Criteria: 7 CFR section 272.10 requires that State agencies ?sufficiently automate their SNAP operations and computerize their systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP.? This includes: (1) processing and storing all case file information necessary for eligibility determination and benefit calculation, identifying specific elements that affect eligibility, and notifying the certification unit of cases requiring notices of disposition, adverse action and mass change, and expiration; (2) providing an automatic cutoff of participation for households that have not been recertified at the end of their certification period by reapplying and being determined eligible for a new period; and (3) generating data necessary to meet federal issuance and reconciliation reporting requirements. Condition: The Department of Health and Human Resources (DHHR) uses the Recipient Automated Payment Information Data System (RAPIDS) as its Automated Data Processing (ADP) system for SNAP. Our testing of the controls surrounding eligibility determination noted that no independent review and approval is required in the system for case information input by the case worker. Further, it was noted that review and approval of disbursements only occurs at the batch level, which does not allow the independent reviewer to review each transaction individually. Data integrity is a critical for the automation SNAP operations. Due to limitations of the ADP system for SNAP, the auditor was unable to conclude whether or not the State?s ADP system for SNAP (i.e., RAPIDS) was in compliance with requirements of 7 CFR section 272.10. Questioned Costs: N/A Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Controls within the RAPIDS system are not designed to sufficiently protect the integrity of data input into the system. Effect: The State agency may not have sufficiently automated its SNAP operations and computerized its systems for obtaining, maintaining, utilizing, and transmitting information concerning SNAP. Recommendation: We recommend that management implement policies and procedures to ensure compliance with requirements surrounding the RAPIDS ADP system for SNAP. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?003 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Grant Award 1WV400401Criteria: 2 CFR 200 requires that costs do not consist of improper payments, defined as ?any payment that should not have been made or that was made in an incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. Incorrect amounts are overpayments or underpayments that are made to eligible recipients (including inappropriate denials of payment or service, any payment that does not account for credit for applicable discounts, payments that are for an incorrect amount, and duplicate payments). An improper payment also includes any payment that was made to an ineligible recipient or for an ineligible good or service, or payments for goods or services not received (except for such payments authorized by law).? Condition: During our testing of 40 cases for allowability for SNAP, we noted one emergency supplemental allotment payment to a recipient for a month that was not allowable. Questioned Costs: $1,125 Context: Total federal expenditures for the SNAP program were $883,958,996 for the year ended June 30, 2022. Cause: Adequate internal controls are not in place to prevent non-compliance surrounding the issuance of SNAP benefits. Effect: Disbursements to recipients could be made that are not allowable. Recommendation: We recommend that DHHR ensure that all compliance requirements are reviewed to ensure the benefit amounts are accurate prior to disbursement. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?004 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Child Nutrition Cluster 10.553/10.555/ 10.556/10.559/ 10.582Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: The West Virginia Department of Education is a prime recipient of funding for the Child Nutrition Cluster and made first tier subawards of greater than $30,000 but did not file any of the necessary Federal Funding Accountability and Transparency Act (FFATA) reports. Questioned Costs: N/A Context: Subawards for the Child Nutrition Cluster program included 316 subawards that totaled $185,593,250 for the year ended June 30, 2022. Total expenditures for the Child Nutrition Cluster program were $194,300,763 for the year ended June 30, 2022. Cause: Policies and procedures and internal controls were not in place to ensure compliance with the Transparency Act. Effect: West Virginia Department of Education management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System. Recommendation: We recommend that West Virginia Department of Education management take immediate action to ensure compliance with the reporting requirements of the FFATA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?005 TRANSPARENCY ACT REPORTING (Repeat of Prior Year Finding 2021?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/State?s Program and Non-Entitlement Gants in Hawaii 14.228/ COVID-19 14.228 Grant Award B14DC540001 Grant Award B16DL540001 #2 Grant Award B15DC540001 Grant Award B16DC540001 Grant Award B17DC540001 Grant Award B18DC540001 Grant Award B19DC540001 Grant Award B20DC540001 Grant Award B20DW540001 Grant Award B21DC540001Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that the reports were not submitted by the State of West Virginia Community Development Block Grant program management within the timeframe designated in 2 CFR 170 Appendix A. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the CDBG program included 22 subawards that totaled $15,177,456 for the year ended June 30, 2022. The five subawards tested that were not reported to the FFATA Subaward Reporting System timely was $7,119,797. Total expenditures for the CDBG program were $25,867,297 for the year ended June 30, 2022. Cause: A lack of oversight and adequate review of the FFATA reporting requirements by CDBG management caused the reports required for first tier subawards over $30,000 to not be submitted timely to the FFATA Subaward Reporting System, and to have missing/incorrect information reported. Effect: CDBG management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System accurately or in a timely fashion Recommendation: We recommend that CDBG management take immediate action to ensure compliance with the reporting requirements of the FFATA, which includes the timely submission of the reports and accurate information Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?005 TRANSPARENCY ACT REPORTING (Repeat of Prior Year Finding 2021?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Housing and Urban Development Community Development Block Grants/State?s Program and Non-Entitlement Gants in Hawaii 14.228/ COVID-19 14.228 Grant Award B14DC540001 Grant Award B16DL540001 #2 Grant Award B15DC540001 Grant Award B16DC540001 Grant Award B17DC540001 Grant Award B18DC540001 Grant Award B19DC540001 Grant Award B20DC540001 Grant Award B20DW540001 Grant Award B21DC540001Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that the reports were not submitted by the State of West Virginia Community Development Block Grant program management within the timeframe designated in 2 CFR 170 Appendix A. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the CDBG program included 22 subawards that totaled $15,177,456 for the year ended June 30, 2022. The five subawards tested that were not reported to the FFATA Subaward Reporting System timely was $7,119,797. Total expenditures for the CDBG program were $25,867,297 for the year ended June 30, 2022. Cause: A lack of oversight and adequate review of the FFATA reporting requirements by CDBG management caused the reports required for first tier subawards over $30,000 to not be submitted timely to the FFATA Subaward Reporting System, and to have missing/incorrect information reported. Effect: CDBG management did not report the necessary FFATA reports for first tier subawards over $30,000 to The FFATA Subaward Reporting System accurately or in a timely fashion Recommendation: We recommend that CDBG management take immediate action to ensure compliance with the reporting requirements of the FFATA, which includes the timely submission of the reports and accurate information Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?006 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS (Repeat of Prior Year Findings 2021?004 and 2020?002) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.508(b) states, ?The auditee must prepare appropriate financial statements, including the schedule of expenditures of Federal awards.? The Federal Office of Management and Budget issues instructions on how to prepare this schedule. Condition: Workforce West Virginia?s (WWV?s) internal controls are not adequate to ensure that the Schedule of Expenditures Federal Awards (SEFA) accurately reports all federal assistance. It was noted the SEFA was resubmitted due to errors causing untimely submission. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the SEFA reporting processes were not adequately enforced to ensure the SEFA is accurate due to lack of training. Effect: WWV is not properly reporting their federal expenditures and type A programs may not be appropriately identified on a timely basis. Recommendation: We recommend that WWV ensure staff responsible for the preparation of the SEFA have the resources needed to accurately prepare the SEFA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?007 REPORTING, AND MATCHING, LEVEL OF EFFORT, EARMARKING (Repeat of Prior Year Findings 2021?006 and 2020?005) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of four ETA 2112 reports submitted, we noted that during the compliance year, management resubmitted three of the reports due to Workforce West Virginia (WWV) not initially following United States Department of Labor guidance related to program classifications. Additionally, the following reports tested were not reviewed and approved prior to submission: 1) two of the two ETA 2208A reports 2) one of the three ETA 9050 reports 3) two of the four ETA 9052 reports 4) two of the four ETA 9055 reports, and 5) one of the two ETA 9128 reports. In addition, one of the two ETA 9128 reports was revised and submitted by the approver. The review and approval of the ETA 2112 is also the control for the matching compliance requirement. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the individual reporting processes were not adequately enforced or documented. Effect: Reports could be filed with errors or lack of supporting documentation and not be identified by management. The matching requirement may not be met. Recommendation: We recommend that WWV implement internal controls over the report submission process, to ensure each report is reviewed and approved by appropriate individuals familiar with the reporting requirements to ensure that accurate information is reported. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?008 INTERNAL CONTROLS OVER INFORMATION TECHNOLOGY (Repeat of Prior Year Findings 2021?005 and 2020?003) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Workforce West Virginia?s (WWV?s) does not perform periodic documented reviews of administrator access changes to the Automated Benefit Payment System (ABPS) or the Unemployment Compensation Tax applications (UC Tax). A user access review is performed periodically for ABPS and UC Tax, however the review is not documented. WWV does not complete documented periodic user access reviews for the Pandemic Unemployment Assistance (PUA) application. Due to a software change, WWV was unable to provide documentation to determine if terminated employees were communicated timely to the West Virginia Office of Technology (WVOT) to remove access or within the organization to remove access to ABPS, UC Tax, and PUA. Complementary user entity controls defined in the Service Organization Controls (SOC) report from Geographic Solutions, Inc. are not in place at WWV. WWV has not performed periodic disaster recovery testing for WWV owned applications. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. Cause: The internal controls over the information technology processes were not adequately designed or implemented. Effect: Unauthorized access to critical information systems may occur and not be detected or resolved in a timely manner causing WWV to be in noncompliance. Recommendation: WWV should implement policies and procedures that include monitoring the information systems and systems controls reports. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?009 SPECIAL TESTS AND PROVISION ? UI PROGRAM INTEGRITY - OVERPAYMENTS (Repeat of Prior Year Findings 2021?007 and 2020?004) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Labor Unemployment Insurance (UI) 17.225 Grant Award UI-35683-21-55-A-54 Grant Award UI-37314-22-55-A-54 Grant Award UI-34749-20-55-A-54 Grant Award UI-35978-21-60-A-54 Grant Award UI-37099-21-55-A-54 Grant Award UI-37257-22-55-A-54Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During fiscal year 2022, the Workforce West Virginia (WWV) overpaid unemployment claims out of funds from the Unemployment Program and the Pandemic Unemployment Assistance Program (PUA). PUA is federal funding provided through the CARES Act to pay unemployment claims for self-employment individuals and independent contractors. Questioned Costs: N/A Context: Total federal disbursements for the Unemployment Insurance (UI) program were $307,154,978 for the year ended June 30, 2022. For three of the 60 overpayments, incomplete documentation did not indicate overpayment classification. For 10 of the 60 overpayments, documentation required by WWV?s policies could not be provided. Cause: WWV?s normal control procedures require proper documentation to be complete for the deputy?s review and approval to complete an overpayment determination and prior to notification to the claimant. However, WWV did not follow policy in retaining required documentation to support deputy decisions for overpayments. Effect: WWV is not following policies and procedures established to identify overpayments and classify them in a manner that allows the state to take appropriate follow-up actions. Recommendation: WWV should enforce appropriate procedures to ensure documentation of review and approval and required forms with deputy decisions is maintained for each overpayment. procedures. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?010 REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Treasury Coronavirus State and Local Fiscal Recovery Funds 21.027Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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).? The terms and conditions of the award require the recipient to submit reports as the Secretary of the U.S. Department of Health and Human Services (HHS) determines are needed to ensure compliance with conditions that are imposed on the payment, and such reports shall be in such form, with such content, as specified by the secretary of HHS in future program instructions directed to all recipients. Condition: The ad hoc extract report of state revenue that was used in calculation of revenue replacement included incorrect data. Questioned Costs: N/A Context: The ad hoc extract report of state revenue for calendar year 2020 included fiscal years 2020 and 2021 data. The revenue replacement calculation consists of comparison of actual calendar year revenues to counterfactual revenue (based on the formula prescribed in the Final Rule). Cause: Management?s internal controls were not appropriately designed to ensure that data used for the revenue replacement calculation is accurate. Effect: The revenue replacement calculations could be inaccurate or incomplete. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Management should ensure the precision of the internal controls over the review of the data used in the revenue replacement calculation identify material errors in the data in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?019 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Rehabilitation Services?Vocational Rehabilitation Grants to State 84.126 Grant Award H126A200095, H126A210095, H126A220095 Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Division of Rehabilitation Services (WVDRS) did not have evidence of the review control related to cash management. One of the five drawdowns selected for testing did not have Director approval to draw the funds down. Questioned Costs: N/A Context: Total federal expenditures for the Vocational Rehabilitation Grant were $31,508,101 for the year ended June 30, 2022. Cause: WVDRS appears to have policies and procedures in place to review the draws prior to requesting; however, the policies and procedures were not followed for this draw. Effect: WVDRS could have drawn down the incorrect amount of federal funds. Recommendation: We recommend that WVDRS enforce the existing policies and procedures surrounding the review and approval of the cash draws prior to requesting the funds. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2022?020 REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Rehabilitation Services?Vocational Rehabilitation Grants to State 84.126 Grant Award H126A200095, H126A210095, H126A220095Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.302(b)(2) ?Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. If a Federal awarding agency requires reporting on an accrual basis from a recipient that maintains its records on other than an accrual basis, the recipient must not be required to establish an accrual accounting system. This recipient may develop accrual data for its reports on the basis of an analysis of the documentation on hand. Similarly, a pass-through entity must not require a subrecipient to establish an accrual accounting system and must allow the subrecipient to develop accrual data for its reports on the basis of an analysis of the documentation on hand.? Condition: The West Virginia Division of Rehabilitation Services (WVDRS) is responsible for preparing the Rehabilitation Services Administration (RSA-17), Federal Financial Report, quarterly. The RSA-17 is used to track the status of financial data tied to a particular Federal Grant Award. The RSA-17 report should be complete, accurate, and prepared in accordance with the required accounting basis. There was an error in reporting where certain amounts reported did not agree to the underlying data used to prepare the reports. The Director?s review was not precise enough to detect the error. Questioned Costs: N/A Context: Total federal expenditures for the Vocational Rehabilitation Grant were $31,508,101 for the year ended June 30, 2022. Cause: WVDRS has policies and procedures in place to review the RSA-17 prior to submission; however, the review was not precise enough to identify the errors. Effect: Incorrect data could be reported to the RSA. Recommendation: We recommend that WVDRS enforce the existing policies and procedures surrounding the review and approval of the RSA-17 report prior to submission. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?027 INTERNAL CONTROLS OVER SPECIAL TESTS AND PROVISIONS ? CHILD SUPPORT NON-COOPERATION, PENALTY FOR REFUSAL TO WORK, AND ADULT CUSTODIAL PARENT OF CHILD UNDER SIX WHEN CHILD CARE NOT AVAILABLE (Repeat of Prior Year Findings 2021?028, 2020?025, 2019?025, 2018?019, 2017?010, 2016?016, 2015?024, 2014?018, 2013?036, 2012?56, 2011?44, and 2010?41) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the issuance and removal of sanctions; however, adequate documentation to test and determine that the controls were operating effectively was not consistently maintained or available. Questioned Costs: N/A Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: Internal controls are not operating effectively surrounding the issuance or removal of sanctions against TANF recipients. Effect: Recipient benefits may potentially be reduced or increased in error or without appropriate cause. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review prior to the issuance or removal of sanctions. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?028 SPECIAL TESTS AND PROVISIONS ? INCOME ELIGIBILITY AND VERIFICATION SYSTEM (Repeat of Prior Year Findings 2021?029 and 2020?026) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Each state shall participate in the Income Eligibility and Verification System (IEVS) required by Section 1137 of the Social Security Act as amended. Under the state plan the state is required to coordinate data exchanges with other federally assisted benefit programs, request and use income and benefit information when making eligibility determinations and adhere to standardized formats and procedures in exchanging information with other programs and agencies. Specifically, the state is required to request and obtain information as follows (42 USC 1320b-7; 45CFR section 205.55). (a) Wage information from the state Wage Information Collection Agency (SWICA) should be obtained for all applicants at the first opportunity following receipt of the application, and for all recipients on a quarterly basis. (b) Unemployment Compensation (UC) information should be obtained for all applicants at the first opportunity, and in each of the first three months in which the individual is receiving aid. This information should also be obtained in each of the first three months following any recipient-reported loss of employment. If an individual is found to be receiving UC, the information should be requested until benefits are exhausted. (c) All available information from the Social Security Administration (SSA) for all applicants at the first opportunity. (d) Information from the U.S. Citizenship and Immigration Services and any other information from other agencies in the state or in other states that might provide income or other useful information. (e) Unearned income from the Internal Revenue Service (IRS). Condition: During testing of 40 TANF cases subject to IEVS, we noted the following: Control - For 40 of the 40 cases selected for control testing, adequate documentation of review of the data exchanges, and system matches, and review of actions taken by the caseworker when required was not provided. Compliance- For 13 of the 40 cases selected for testing, the recipient did not appear to be receiving WVWorks benefits. The auditor was unable to determine if these cases should have been subject to a data match under TANF. For three of the 40 cases selected for testing, the recipient appeared to be receiving WVworks benefits, and a data match indicating caseworker action required was noted, but no action was completed. Additionally, additional documentation supporting no action required for the match was not available. For the remaining 24 of the 40 cases, the recipient appeared to be receiving WVWorks, a data match occurred, and related worker action was taken, but documentation supporting the action was not available. In addition, the auditor could not determine if specific action items were completed relating to individual exchange types. Questioned Costs: Unknown Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: There are insufficient internal controls in place surrounding the generation and review of populations provided to the auditor, the Income Eligibility and Verification System matches, and the caseworker actions required within the Recipient Automated Payment Information Data System (RAPIDS). Also, insufficient documentation surrounding matches made between the information systems and actions taken after a match is made. Effect: The State of WV may not be coordinating data exchanges with other federally assisted benefit programs as required by the state plan. Recommendation: We recommend that management implement policies and procedures to ensure that information in RAPIDS and populations are complete and accurate. In addition, we also recommend DHHR evaluate their control over the caseworker action requirement within RAPIDS on matches related to the Income Eligibility and Verification System. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?027 INTERNAL CONTROLS OVER SPECIAL TESTS AND PROVISIONS ? CHILD SUPPORT NON-COOPERATION, PENALTY FOR REFUSAL TO WORK, AND ADULT CUSTODIAL PARENT OF CHILD UNDER SIX WHEN CHILD CARE NOT AVAILABLE (Repeat of Prior Year Findings 2021?028, 2020?025, 2019?025, 2018?019, 2017?010, 2016?016, 2015?024, 2014?018, 2013?036, 2012?56, 2011?44, and 2010?41) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the issuance and removal of sanctions; however, adequate documentation to test and determine that the controls were operating effectively was not consistently maintained or available. Questioned Costs: N/A Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: Internal controls are not operating effectively surrounding the issuance or removal of sanctions against TANF recipients. Effect: Recipient benefits may potentially be reduced or increased in error or without appropriate cause. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review prior to the issuance or removal of sanctions. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?028 SPECIAL TESTS AND PROVISIONS ? INCOME ELIGIBILITY AND VERIFICATION SYSTEM (Repeat of Prior Year Findings 2021?029 and 2020?026) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Each state shall participate in the Income Eligibility and Verification System (IEVS) required by Section 1137 of the Social Security Act as amended. Under the state plan the state is required to coordinate data exchanges with other federally assisted benefit programs, request and use income and benefit information when making eligibility determinations and adhere to standardized formats and procedures in exchanging information with other programs and agencies. Specifically, the state is required to request and obtain information as follows (42 USC 1320b-7; 45CFR section 205.55). (a) Wage information from the state Wage Information Collection Agency (SWICA) should be obtained for all applicants at the first opportunity following receipt of the application, and for all recipients on a quarterly basis. (b) Unemployment Compensation (UC) information should be obtained for all applicants at the first opportunity, and in each of the first three months in which the individual is receiving aid. This information should also be obtained in each of the first three months following any recipient-reported loss of employment. If an individual is found to be receiving UC, the information should be requested until benefits are exhausted. (c) All available information from the Social Security Administration (SSA) for all applicants at the first opportunity. (d) Information from the U.S. Citizenship and Immigration Services and any other information from other agencies in the state or in other states that might provide income or other useful information. (e) Unearned income from the Internal Revenue Service (IRS). Condition: During testing of 40 TANF cases subject to IEVS, we noted the following: Control - For 40 of the 40 cases selected for control testing, adequate documentation of review of the data exchanges, and system matches, and review of actions taken by the caseworker when required was not provided. Compliance- For 13 of the 40 cases selected for testing, the recipient did not appear to be receiving WVWorks benefits. The auditor was unable to determine if these cases should have been subject to a data match under TANF. For three of the 40 cases selected for testing, the recipient appeared to be receiving WVworks benefits, and a data match indicating caseworker action required was noted, but no action was completed. Additionally, additional documentation supporting no action required for the match was not available. For the remaining 24 of the 40 cases, the recipient appeared to be receiving WVWorks, a data match occurred, and related worker action was taken, but documentation supporting the action was not available. In addition, the auditor could not determine if specific action items were completed relating to individual exchange types. Questioned Costs: Unknown Context: Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: There are insufficient internal controls in place surrounding the generation and review of populations provided to the auditor, the Income Eligibility and Verification System matches, and the caseworker actions required within the Recipient Automated Payment Information Data System (RAPIDS). Also, insufficient documentation surrounding matches made between the information systems and actions taken after a match is made. Effect: The State of WV may not be coordinating data exchanges with other federally assisted benefit programs as required by the state plan. Recommendation: We recommend that management implement policies and procedures to ensure that information in RAPIDS and populations are complete and accurate. In addition, we also recommend DHHR evaluate their control over the caseworker action requirement within RAPIDS on matches related to the Income Eligibility and Verification System. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?029 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Low-Income Home Energy Assistance 93.568/ COVID-19 93.568 Grant Award G-2201WVLIEA Grant Award G-2201WVLIEI U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2022 ? 2022G996115 Grant Award 2021 ? 2021G996115 Grant Award 2021 ? 2021G990228Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Per 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) reports for the Low-Income Home Energy Assistance (LIHEAP) program, there were certain instances noted whereby the Department of Health and Human Resources (DHHR) reported incorrect amounts for subawards. Therefore, the LIHEAP program was not in compliance with the provisions of 2 CFR 170 Appendix A. Low-Income Home Energy Assistance (LIHEAP) ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the LIHEAP program included 28 subawards that totaled $14,526,625 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $5,827,409 selected for testing. Total federal expenditures for LIHEAP for the fiscal year ended June 30, 2022, were $50,464,421. Subawards for the TANF program from the West Virginia Department of Education included 12 subawards that totaled $4,909,507 for the year ended June 30, 2022. The five subawards that were reported to the FFATA Subaward Reporting System incorrectly represent the entirety of the $1,882,492 selected for testing. Total federal expenditures for TANF for the fiscal year ended June 30, 2022, were $105,423,491. Cause: In regards to the incorrect amounts for subawards, DHHR received the awards directly from the federal awarding agency. DHHR passed through a portion of the awards to other non-federal entities that were also agencies of the State. Those other agencies of the State subsequently passed through a portion of their awards to other non-federal entities that are not agencies of the State. When DHHR passed through the awards to other agencies of the State, DHHR used their standard grant agreement template since those agencies were external to DHHR. From the perspective of DHHR, DHHR is the prime recipient and the other state agencies were first-tier subrecipients. Therefore, when completing the FFATA reports, the DHHR inappropriately entered the other State agencies as the subrecipient/subawardee. Effect: The FFATA reports do not provide an accurate description of the subawardee information. Recommendation: DHHR should consider the State of West Virginia to be the prime recipient. Even if the DHHR passes through a portion of a federal award to other non-federal entities that are agencies of the State, the DHHR should consider those agencies to be part of the prime recipient tier instead of subrecipients. Regardless of the State agency that receives the award directly from the federal awarding agency, the only time a subrecipient relationship exists for the State is when a portion of the award is passed through to a non-federal entity that is not an agency of the State. Accordingly, when DHHR receives and passes through a portion of a federal award to another agency of the State, DHHR should work with the other agency when completing the FFATA reports in an effort to ensure that all subawardee information is complete and accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?044 INTERNAL CONTROL--PAYROLL Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST U.S. Department of Agriculture Special Supplemental Nutrition Program for Women, Infants and Children (WIC) 10.557 Grant Award 221WV701W1003Criteria: Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) 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 State of West Virginia utilizes a third-party payroll time keeping application. On December 11, 2021,?the third-party had a ransomware attack and from December 11, 2021, to January 18, 2022, the State of West Virginia was unable to rely on the controls within the third-party time keeping system and was required to perform manual time keeping during the outage. The State implemented manual controls on an agency basis. While each agency developed processes and controls, there was not adequate documentation relating to the control and/or the precision of the control in all instances. In addition, during our testing of WIC payroll it was noted that one individual?s time card was not approved timely by a manager in the payroll system. Questioned Costs: N/A Context: Total federal expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $82,914,965 and $105,423,491, $31,685,992, respectively. Total payroll expenditures for Foster Care, TANF, and WIC for the fiscal year ended June 30, 2022, were $10,199,569, $12,148,324, and $1,473,230, respectively. Cause: The State of West Virginia?s third-party vendor had a control failure which required the State agencies to implement contingency policies and procedures due to the lack of availability of the system. This resulted in mitigating controls being implemented immediately. Thus, adequate and consistent internal control documentation was not always maintained. In addition, the DHHR did not follow existing policies and procedures for payroll approval. Effect: The payroll could be inaccurately charged to a federal program. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner, including potential contingencies and retention of control documentation policies and procedures, in the event the system is unavailable. Management should also maintain documentation of review and approval of payroll transactions and ensure that the review and approval is timely. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?030 SPECIAL TESTS AND PROVISIONS ? PROVIDER ELIGIBILITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 455 Subpart E requires CHIP providers to be licensed in accordance with federal, state, and local laws and regulations to participate in the CHIP program, be screened and enrolled in CHIP, and make certain required disclosures to the state. Condition: During our testing of 60 cases for provider eligibility for CHIP, we noted one instance where a provider selected not to be a CHIP provider, however, was documented as a CHIP provider. We also noted four providers who chose to be terminated as a CHIP provider, however, were still documented as a CHIP provider. We also noted three providers did not have a letter of approval noting provider number or effective date. We also noted one provider that did not have a current license in the file. Questioned Costs: Unknown Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. Cause: Management indicated that the providers were input incorrectly into the system. The appropriate documentation was not provided for the providers that did not have a letter of approval or current license. Effect: Payments may have been made to ineligible providers. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?032 ALLOWABILITY OF EXPENDITURES Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.302(a) states, ?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.? 2 CFR 200.403(g) states costs must ?Be adequately documented.? 2 CFR 200.456 states ?Participant support costs as defined in 200.1 are allowable with the prior approval of the Federal awarding agency.? Condition: During our testing of the allowability it was noted that for four out of 60 tested, the West Virginia Department of Health and Human Resources (WVDHHR) did not perform the quarterly updates to the wage index for the Outpatient Prospective Payment System (OPPS). Questioned Costs: $841.58 ? Assistance Listing #93.767 Context: The four expenditures represent $841 of the 60 expenditures selected for testing of $140,069. The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. Cause: WVDHHR did not update wage index for OPPS payments for four of the 60 expenditures. Effect: Incorrect payments may have been made for procedure codes. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?033 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the CHIP contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. Condition: During our testing of the audited financial reports of the CHIP contract required to be submitted by Managed Care Organizations (MCOs), it was noted that none of the MCOs submitted audited financial reports. There are three MCOs and all three of the MCOs were selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: Management indicated that the audited financial statements had not been obtained. Management indicated that they were in the process of implementing procedures around financial reporting for the MCOs. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that the financial audits are obtained and documentation of review and approval of the financial audits is maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?034 ELIGIBILITY (Repeat of Prior Year Finding 2021?037) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021Criteria: 42 CFR 435.914 states ?(a) The agency must include in each applicant's case record facts to support the agency's decision on his application. (b) The agency must dispose of each application by a finding of eligibility or ineligibility, unless?(1) There is an entry in the case record that the applicant voluntarily withdrew the application, and that the agency sent a notice confirming his decision; (2) There is a supporting entry in the case record that the applicant has died; or (3) There is a supporting entry in the case record that the applicant cannot be located.? 42 CFR 457.965 states ?The State must include in each applicant's record facts to support the State's determination of the applicant's eligibility for CHIP.? 42 CFR 435.945(j) and 457.380(j) require states to develop and submit to the Centers for Medicaid and Medicare Services (upon request) a plan describing the Medicaid and CHIP eligibility verification policies and procedures adopted by the State. The State of West Virginia Modified Adjusted Gross Income (MAGI)-Based Eligibility Verification Plan for Medicaid & CHIP requires the following eligibility factors to be verified: income, residency, age, social security number, citizenship, immigration status, household composition, pregnancy, caretaker relative, Medicare, application for other benefits, and other insurance coverage. These are either required to be verified through electronic data sources or through self-attestation without additional verification or self-attestation with post-eligibility verification. Electronic data sources include: the Internal Revenue Service, Social Security Administration, State Wage Information Collection Agency, State Unemployment Compensation, State Administered Supplementary Payment Program, State General Assistance Programs, Supplemental Nutrition Assistance Program, Temporary Assistance for Needy Family, Bureau for Child Support Enforcement, State Income Tax, TALX, Work Force West Virginia and Families and Children Tracking System Income. State verification plans does not provide specific details. The most recently submitted plan for the State is posted on Medicaid.gov. Condition: During our testing of 60 cases for eligibility for CHIP, we noted one instance where the social security number, age, date of birth, and immigration status was not verified in the Data Exchange System as required by the State?s MAGI-based CHIP eligibility verification plan; and nine instances where income was not verified. Questioned Costs: $4,104 ? Assistance Listing #93.767 Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The nine cases with questioned costs represent $4,104 of CHIP payments out of a population of benefit payments tested for eligibility of $199,490. Cause: Management indicated that the information was verified in accordance with the CHIP verification plan or State plan, but no documentation was kept in the file of the verification. Effect: Payments may have been made for ineligible recipients. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. DHHR implemented an eligibility system enhancement on April 17, 2021, to retain historical record of verification of financial information obtained from the Federal Data Services Hub. We recommend that DHHR continue to follow the new policies and procedures. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?038 SUBRECIPIENT CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1 Grant Award 1H79TI081724-01 Grant Award 6H79TI083313Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.305(b)(1) requires that the non-federal entity must ?monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient.? Per DHHR policy, the Spending Unit shall limit cash advances to a subrecipient to the minimum amounts needed and be timed in accordance with the actual, immediate cash requirements of the subrecipient for carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the subrecipient for direct program or project costs and the proportionate share of any allowable indirect costs. Condition: During our testing of the State Targeted Response to the Opioid Crisis Grants, the West Virginia Department of Health and Human Resources (DHHR) was unable to provide adequate documentation supporting why the subrecipient drawdowns were approved for payment for three of the 40 drawdowns selected for testing. The supporting documentation for the draw down showed less expenses than the amount that had been drawn down to date on the grants. The supporting documentation also showed the subrecipients appeared to have adequate cash balances on hand at the time of the request. Questioned Costs: $493,423 Context: The total subrecipient drawdowns selected for testing was $3,521,390. The total amount of subrecipient drawdowns for the Opioid STR program during fiscal year 2022 was $38,332,337. Cause: Documentation to support the amount paid to the subrecipient was not retained by DHHR. In addition, supporting documentation was not retained to demonstrate cash advances to the subrecipient represented the minimum amount needed for actual and immediate cash requirements of the subrecipient for carrying out the purpose of the program. Effect: The cash remitted to the subrecipient may not be accurate and may be in excess of the subrecipients actual and immediate cash requirements for carrying out the purpose of the program. Recommendation: We recommend that DHHR establish policies and procedures requiring documentation from subrecipients substantiating that the amount of a drawdown is appropriate based on the expenditures through the request date so that the reconciliation preformed for the related drawdown is sufficient to determine that the drawdown is appropriate and excess cash is not remitted to the subrecipient. Views of Responsible Officials: Management concurs with the findings and has developed a plan to correct the finding.
2022?039 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1 Grant Award 1H79TI081724-01 Grant Award 6H79TI083313Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? 2 CFR 170 Appendix A, ?unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.? Condition: During our testing of Federal Funding Accountability and Transparency Act (FFATA) Reports, it was noted that one report was not submitted by the State of West Virginia Opioid STR (DHHR) program management within the timeframe designated in 2 CFR 170 Appendix A, and one report had an incorrect subaward amount. ?See Schedule of Findings and Questioned Costs for char/table? Questioned Costs: N/A Context: Subawards for the Opioid STR program included 183 subawards which had payments that totaled $38,332,337 for the year ended June 30, 2022. The federal expenditures for the Opioid STR program for fiscal year ended June 30, 2022, were $42,026,455. Cause: A lack of oversight and adequate review of the FFATA reporting by DHHR management. Effect: DHHR management did not report the necessary FFATA report for Opioid STR first-tier subawards over $30,000 to The FFATA Subaward Reporting System in a timely fashion for one report and for one report, the wrong amount was reported for the subaward. Recommendation: We recommend that DHHR strengthen internal controls and policies and procedure over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?040 SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 6H79TI081724 Grant Award 5H79TI083313 Grant Award 1H79TI083313-01 Grant Award 3H79TI081724-01W1Criteria: 2 CFR 200.303 requires that non-Federal entities must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Division of Corrections and Rehabilitation?s internal controls are not adequate to ensure the Schedule of Expenditures of Federal Awards (SEFA) accurately reports all federal assistance. Our review of the Division?s SEFA for fiscal year 2022 identified that total expenditures under the Opioid STR program were overstated by $805,327. Questioned Costs: N/A Context: The total federal expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455. Cause: The internal controls over the SEFA reporting processes were not operating effectively to ensure the SEFA is accurate. Effect: The Division of Corrections and Rehabilitation is not properly reporting their federal expenditures and major programs may not be appropriately identified on a timely basis. Recommendation: We recommend that the Division ensure staff responsible for the preparation of the SEFA have the resources needed to accurately prepare the SEFA. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?026 INTERNAL CONTROLS OVER CHILD CARE PROVIDER ELIGIBILITY FOR ARP ACT STABILIZATION FUNDS Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Child Care Disaster Relief/Child Care Development Block Grant/Child Care Mandatory and Matching Funds of the Child Care Development Fund (CCDF Cluster) 93.489/93.575/ 93.596/ COVID-19 93.575 Grant Award 2022 ? 2022G999005 Grant Award 2022 ? 2022G996005 Grant Award 2022 ? 2022G999004 Grant Award 2021 ? 2021G996005 Grant Award 2021 ? 2021G999005 Grant Award 2021 ? 2021G999004Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding the review and approval of provider certifications in the application for funding and review and approval of verification of eligibility criteria; however, adequate documentation to test and determine that the controls were operating effectively was not available. Questioned Costs: N/A Context: Total federal expenditures for CCDF Cluster for the fiscal year ended June 30, 2022, were $196,326,309. Cause: Internal controls are not operating effectively surrounding the review and approval of provider certifications and verification of eligibility criteria. Effect: Providers who received ARP Act Stabilization funds may not have met the eligibility criteria or made the required certifications. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its review and approval of provider certifications and eligibility criteria. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?041 INTERNAL CONTROLS OVER SUBRECIPIENT MONITORING (Repeat of Prior Year Finding 2021?039) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Opioid STR-State Targeted Response to the Opioid Crisis Grants 93.788 Grant Award 1H79TI081724-01 Grant Award 6H79TI081724-02M004 Grant Award 1H79TI083313-01 Grant Award 6H79TI081724-02M003 Grant Award 6H79TI083313-01M001 Grant Award 6H79TI083313-02M002 Grant Award 5H79TI083313-02 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID-19 93.575 Grant Award G2101WVCCDF Grant Award G2201WVCCDF Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2022G996115 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) 93.323/ COVID19 93.323 Grant Award 6 NU50CK000551-01-06 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-02-03 Grant Award 6 NU50CK000551-01-07 Grant Award 6 NU50CK000551-02-04 Grant Award 6 NU50CK000551-01-05 Grant Award 5 NU50CK000551-02-00 Grant Award 6 NU50CK000551-01-00 Grant Award 6 NU50CK000551-01-01 Grant Award 6 NU50CK000551-02-06 Grant Award 6 NU50CK000551-02-08Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our internal control testing of subrecipient monitoring, we determined that the documentation regarding the subrecipient risk assessment is not maintained. Therefore, management was unable to provide documentation supporting that the level of monitoring completed for each subrecipient is appropriate based on the risk assessment. Questioned Costs: N/A Context: The federal expenditures and subrecipient expenditures for the State Targeted Response to the Opioid Crisis program for the fiscal year ended June 30, 2022, were $42,026,455 and $35,047,416, respectively. The federal expenditures and subrecipient expenditures for the Child Care and Development Fund (CCDF) Cluster for the fiscal year ended June 30, 2022, were $196,326,309 and $41,166,713, respectively. The federal expenditures and subrecipient expenditures for the Temporary Assistance for Needy Families (TANF) for the fiscal year ended June 30, 2022, were $105,423,491 and $11,542,396, respectively. The federal expenditures and subrecipient expenditures for Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) for the fiscal year ended June 30, 2022, were $105,928,082 and $21,044,729, respectively. Cause: There is lack of sufficient documentary evidence to support that the level of monitoring is appropriate and that controls are operating as designed related to subrecipient monitoring. Effect: Subrecipients may not be properly risk assessed; therefore, impacting the type and amount of monitoring that would be performed in the future. Recommendation: We recommend that DHHR management maintain sufficient documentation to evidence its assessment of and internal controls surrounding the extent of subrecipient monitoring. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Agriculture Supplemental Nutrition Assistance Program (SNAP) 10.551/10.561/ COVID-19 10.561 Grant Award 1WV400401 Grant Award 1WV400468 Grant Award 1WV430459 Grant Award 1WV430469 Grant Award 1WV460479 Pandemic EBT Food Benefits (P-EBT) 10.542 U.S. Department of Health and Human Services Temporary Assistance for Needy Families (TANF) 93.558/ COVID-19 93.558 Grant Award 2021G996115 Grant Award 2021G990228 Grant Award 2022G996115 Low-Income Home Energy Assistance 93.568/ COVID19 93.568 Grant Award 2001WVLIE4 Grant Award 2101WVLIEA Grant Award 2101WVE5C6 Grant Award 2201WVLIEA Grant Award 2201 WVLIEI Grant Award 2001WVE5C3 Child Care and Development Fund (CCDF) Cluster 93.575/93.596/ COVID19 93.575 Grant Award 2101WVCCDF Grant Award 2101WVCCDM Grant Award 2101WVCCDD Grant Award 2201WVCCDF Grant Award 2201WVCCDM Grant Award 2201WVCCDD Foster Care ? Title IV-E 93.658 Grant Award 2101WVFOST Grant Award 2201WVFOST Adoption Assistance ? Title IV-E 93.659 Grant Award 2101WVADPT Grant Award 2201WVADPT Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2205WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2205WV5MAP Grant Award 2205WV5ADM Grant Award 2205WVIMPL Grant Award 2205WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Family and Children Tracking System (FACTS): West Virginia Department of Health and Human Resources (DHHR) operates a wide variety of computer applications, many of which affect federal and State programs? data. Our review of the information system controls noted that adequate segregation of duties does not exist for the FACTS information system. Certain users have the ability to both create and approve cases. We noted that management implemented a mitigating detect control for the Foster Care program during fiscal year 2012 in response to this repeat finding; however, it was not designed to encompass the Adoption Assistance program or automatic payments in the Foster Care program. Additionally, no supervisory review is required for provider payment information input into the system. Recipient Automated Payment Information Data System (RAPIDS): Application Suite: Our testing of the controls surrounding eligibility determination noted that adequate segregation of duties does not exist for the RAPIDS system. No supervisory review is required for case information input into the system. Further, it was noted that approval of disbursements only occurs at the batch level, which does not allow the approval worker to review each transaction individually. Questioned Costs: N/A Context: Total federal expenditures for these programs can be located in the Schedule of Expenditures of Federal Awards. The table below identifies the federal programs and compliance requirements impacted. ?See Schedule of Findings and Questioned Costs for char/table? Cause: Policies and procedures have not been adequately updated for changes in the processing of eligibility determinations. Furthermore, management indicated that a lack of personnel resources contributes to the improper segregation of duties issue. Effect: Without proper segregation of duties or adequate detect controls, the ability exists for certain information system users to create and approve cases and demand payments within the FACTS application. Information can be input into the FACTS application or modified within the application without supervisory review, which could lead to payments being made to ineligible applicants, for the improper amount, or for an improper length of time. Without proper segregation of duties or adequate detect controls, the ability exists for case workers to input unsupported information into an applicant?s eligibility calculation within RAPIDS. Further, without supervisory review at the transactional level, disbursements for unallowable costs or activities could occur. 2022?001 DHHR INFORMATION SYSTEM AND RELATED BUSINESS PROCESS CONTROLS (Repeat of Prior Year Findings 2021?001, 2020?023, 2019?027, 2018?017, 2017?002, 2016?017, 2015?025, 2014?016, 2013?034, 2012?51, 2011?46, 2010?43, 2009?43, and 2008?55) (continued) Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that access to various FACTS system applications be restricted to a limited number of users. Controls should be established to ensure that an individual is limited to either creating or approving cases or payments. A detect control should be implemented that would require a review of all individual cases and payments with the same request and approval worker to ensure that cases and payments created and approved were appropriate. Further, we recommend that a formal review process be implemented to ensure that information input into FACTS and RAPIDS is properly reviewed by authorized individuals prior to payment. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?031 SPECIAL TESTS AND PROVISIONS ? MEDICAL LOSS RATIO (MLR) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Children?s Health Insurance Program (CHIP) 93.767 Grant Award 2005WV5021 Grant Award 2105WV5021 Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WV5021 Grant Award 2105WV5021 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(k) requires each MCO, PIHP, and PAHP to submit a report with the data elements specified in 42 CFR 457.1203(e), cross-referencing 42 CFR 438.8 (k) and 438.8. The report should contain the required 13 data elements in the regulation, reflect the correct reporting years, and contain an attestation of accuracy regarding the calculation of the MLR. The state should have a method to indicate when the report(s) are due from plans and should not accept multiple submissions from plans unless the capitation rates are revised retroactively. Condition: During our testing of the MLR reports of the CHIP and Medicaid contracts required to be submitted by Managed Care Organizations (MCOs), it was noted all three of the MCOs submitted MLR reports, however, DHHR had no documentation of their review and approval of the three MLR reports selected for testing. DHHR does not have any PIHPs or PAHPs. Questioned Costs: N/A Context: The federal expenditures for the CHIP program for the fiscal year ended June 30, 2022, were $75,615,993. The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The population subject to testing were the MLR reports of CHIP and Medicaid?s three MCOs. Cause: Management indicated that the review and approval of the MLR reports was not documented and maintained in the files. Effect: The DHHR does not have a documented control over the Medical Loss Ratio special test requirements. The MCOs may be reporting inaccurate data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the MLR reports is documented and maintained. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?035 SPECIAL TESTING AND PROVISIONS ? UTILIZATION CONTROL AND PROGRAM INTEGRITY Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services. In addition, the state must have (1) methods of determining criteria for identifying suspected fraud cases; (2) methods for investigating these cases; and (3) procedures, developed in cooperation with legal authorities, for referring credible allegations of fraud cases to law enforcement officials (42 CFR parts 455, 456, and 1002). Credible allegations of provider fraud must be referred to the state MFCU or an appropriate law enforcement agency in states with no certified MFCU (42 CFR Part 455.21). See Special Test #6, MFCU. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). In addition, the SMA as required per Section 1902(a)(68) ? [42 USC 1396a(a)(68)] False Claims Education must ensure that providers and contractors receiving or making payments of at least $5 million annually under a state?s Medicaid program have (a) established written policies for all employees (including management) about the Federal False Claims Act, whistleblower protections, administrative remedies, and any pertinent state laws and rules; (b) included as part of these policies detailed provisions regarding detecting and preventing fraud, waste, and abuse; and (c) included in any employee handbook a discussion of the False Claims Act, whistleblower protections, administrative remedies, and pertinent state laws and rules. Condition: The West Virginia Department of Health & Human Resources (DHHR) has policies and procedures in place surrounding case closure process. The key control is the review and approval of the Case Closure checklist. Of the 40 cases selected for testing, we noted the following: four cases had no documentation of the Case Closure checklist and one case had documentation of review; however, the review was not completed within the 60 calendar days, per the entity?s policy. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $ $4,466,291,166. The total population subject to testing was 568 closed cases with the Office of Program Integrity (OPI). Cause: Management did not document the review and approval of the Case Closure checklist. Effect: Cases may be closed without verification by management that all required elements of closed cases are present. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. We recommend that Office of Program Integrity establish policies and procedures to ensure that case files are reviewed timely upon closure by a member of management separate from the caseworker and that the review is documented. The Office of Program Integrity?s control policy for case closures should also define a reasonable time period for review of closed cases. Views of Responsible Officials: Management agrees with the finding and working on a corrective action plan.
2022?036 SPECIAL TESTS AND PROVISIONS ? MANAGED CARE FINANCIAL AUDIT (Repeat of Prior Year Finding 2021?036) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCTCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 42 CFR section 438.3(m) requires each MCO, PIHP, and PAHP to submit to the state an audited financial report specific to the Medicaid contract on an annual basis. The audit must be conducted in accordance with generally accepted accounting principles and generally accepted auditing standards. 42 CFR 438.602(e) requires that the ?State must periodically, but no less frequently than once every three years, conduct, or contract for the conduct of, an independent audit of the accuracy, truthfulness, and completeness of the encounter and financial data submitted by, or on behalf of, each MCO, PIHP, or PAHP.? 42 CFR 438.602(g) requires that the periodic audits must be posted on the State?s website. Condition: a) During our testing of the audited financial reports of the Medicaid contract required to be submitted by Managed Care Organizations (MCOs), it was noted that all three of the MCOs submitted audited financial reports; however, West Virginia Department of Health and Human Resources (DHHR) had no documentation of their review and approval of the three audited financial reports selected for testing. b) During our testing of the periodic audits, it was noted that the DHHR has contracted for the conduct of an independent audit for each MCO, however the reports have not been completed or posted on the State?s website. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. The populations subject to testing were the financial and periodic audits of Medicaid?s three MCOs. Cause: a) Management indicated that the review and approval of the financial audits was not documented and maintained in the files. b) Management indicated that they contracted with an independent accounting firm to conduct the periodic audits on each MCO for fiscal year 2021; however, the reports have not been finalized and issued. Effect: The DHHR is not in compliance with the Managed Care Financial Audit special test requirements. The MCOs may be reporting inaccurate encounter or financial data. Recommendation: We recommend that DHHR create a policy and procedure to ensure that documentation of review and approval of the financial audits is documented and maintained. We recommend that DHHR conduct or contract to conduct periodic audits of the MCOs in accordance with the compliance requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?037 SPECIAL TESTS AND PROVISIONS ? SPECIAL TEST AND PROVISIONS: ADP RISK ANALYSIS & SYSTEM SECURITY REVIEW Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Health and Human Services Medicaid Cluster 93.775/93.777/ COVID-19 93.777/ 93.778/ ARRA 93.778 Grant Award 2005WVINCT Grant Award 1905WV5MAP Grant Award 2005WV5ADM Grant Award 2005WVIMPL Grant Award 2005WV5MAP Grant Award 2105WV5MAP Grant Award 2105WV5ADM Grant Award 2105WVIMPL Grant Award 2105WVINCT Grant Award 2005WVINCT Grant Award 1905WV5MAPCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 45 CFR 95.621 requires SMAs must establish and maintain a program for conducting periodic risk analyses to ensure that appropriate and cost-effective safeguards are incorporated into new and existing systems. SMAs must perform risk analyses whenever significant system changes occur. SMAs shall review the Automated Data Processing (ADP) system security installations involved in the administration of the Secretary of the U.S. Department of Health and Human Services (HHS) programs on a biennial basis. At a minimum, the reviews shall include an evaluation of physical and data security operating procedures, and personnel practices. The SMA shall maintain reports on its biennial ADP system security reviews, together with pertinent supporting documentation, for HHS on-site reviews. Condition: The West Virginia Department of Health & Human Resources (DHHR) utilizes two ADP systems related to Medicaid: RAPIDS and West Virginia?s Medicaid Management Information System (MMIS). DHHR has policies and procedures in place related to performing ADP system security & risk assessment annually over the RAPIDS system. DHHR does not have policies and procedures established to perform periodic risk assessments and security reviews over MMIS. As this system utilizes sub-systems (Health PAS Solution) with automated components that directly affect the Medicaid cluster of programs, it meets the criteria stated above from 45 CFR 95.621. DHHR obtains a Service Organization Controls (SOC) 1 Type 2 report for MMIS annually, but DHHR does not include it in their ADP system security & risk assessment. Questioned Costs: N/A Context: The federal expenditures for the Medicaid program for the fiscal year ended June 30, 2022, were $4,466,291,166. Cause: Management?s policies and procedures do not include performing a risk assessment and system security review over MMIS. Management does not formally review the SOC-1 Type 2 report for MMIS. Effect: MMIS risk or security concerns or control issues may not be identified by management in a timely manner. This can potentially reduce the implementation or update safeguards to address risks over both physical and digital resources/information. Recommendation: DHHR should develop a corrective action plan to address this matter in a timely manner. We recommend the establishment of policies and procedures to perform the risk assessment and security review and review the SOC 1 type 2 report for control issues identified. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?042 REPORTING (Repeat of Prior Year Finding 2021?041) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 170.200 indicates that ?federal awarding agencies are required to publicly report federal awards that equal or exceed the micro-purchase threshold and publish the required information on a public-facing, OMB-designated, government-wide website and follow OMB guidance to support Transparency Act implementation.? Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA), as amended by Section 6202 of Public Law 110-252, 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). Condition: For 17 of the 29 subawards selected for testing, the West Virginia Division of Emergency Management (DEM) was not in compliance with FFATA reporting requirements. The following table summarizes the exceptions noted during testing. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 29 2 10 4 17 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $25,528,869 $3,161,818 $5,291,334 $5,969,564 $9,899,382 Questioned Costs: N/A Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: DEM does not have adequate internal controls and policies and procedures in place to ensure that subawards of $30,000 or more are being reported timely and accurately to FSRS. Effect: DEM is not reporting accurate and timely information for first-tier subawards of $30,000 or more causing them not to be in compliance with federal reporting requirements. Recommendation: We recommend that DEM strengthen internal controls and policies and procedures over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?043 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.332(b) requires that all pass-through entities must: (b) 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 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; and (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). Condition: We noted that the DEM did not perform a subrecipient risk assessment. Therefore, DEM was unable to provide documentation supporting that the level of monitoring to be completed for each subrecipient was appropriate based on the risk assessment. DEM only monitored two subrecipients during the year due to limited staffing and no risk assessment being performed. Questioned Costs: Unknown Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: Although DEM has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year, subrecipient risk assessments were not completed and an adequate number of subrecipients were not monitored. Effect: DEM does not have proper internal controls in place to ensure policies and procedures surrounding the subrecipient monitoring compliance requirements are in effect. DEM does not have evidence to support appropriate subrecipient monitoring; therefore, management may not be able to identify issues in a timely manner. Recommendation: We recommend that DEM review policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure they are in compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?042 REPORTING (Repeat of Prior Year Finding 2021?041) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 170.200 indicates that ?federal awarding agencies are required to publicly report federal awards that equal or exceed the micro-purchase threshold and publish the required information on a public-facing, OMB-designated, government-wide website and follow OMB guidance to support Transparency Act implementation.? Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA), as amended by Section 6202 of Public Law 110-252, 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). Condition: For 17 of the 29 subawards selected for testing, the West Virginia Division of Emergency Management (DEM) was not in compliance with FFATA reporting requirements. The following table summarizes the exceptions noted during testing. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 29 2 10 4 17 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $25,528,869 $3,161,818 $5,291,334 $5,969,564 $9,899,382 Questioned Costs: N/A Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: DEM does not have adequate internal controls and policies and procedures in place to ensure that subawards of $30,000 or more are being reported timely and accurately to FSRS. Effect: DEM is not reporting accurate and timely information for first-tier subawards of $30,000 or more causing them not to be in compliance with federal reporting requirements. Recommendation: We recommend that DEM strengthen internal controls and policies and procedures over FFATA reporting to ensure they are in compliance with federal reporting requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?043 SUBRECIPIENT MONITORING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Homeland Security Disaster Grants ? Public Assistance (Presidentially Declared Disasters) 97.036/ COVID-19 97.036 Grant Award FEMA?4219-DR?WV Grant Award FEMA?4220-DR?WV Grant Award FEMA?4273-DR?WV Grant Award FEMA?4331-DR?WV Grant Award FEMA?4359-DR?WV Grant Award FEMA?4378-DR?WV Grant Award FEMA?4455-DR?WV Grant Award FEMA?4517-DR?WV Grant Award FEMA?4603-DR?WV Grant Award FEMA?4605-DR?WVCriteria: 2 CFR 200.303 requires that the West Virginia Division of Emergency Management (DEM) must ?(a) 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 and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.332(b) requires that all pass-through entities must: (b) 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 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; and (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). Condition: We noted that the DEM did not perform a subrecipient risk assessment. Therefore, DEM was unable to provide documentation supporting that the level of monitoring to be completed for each subrecipient was appropriate based on the risk assessment. DEM only monitored two subrecipients during the year due to limited staffing and no risk assessment being performed. Questioned Costs: Unknown Context: Total federal expenditures and total subrecipient expenditures for the Disaster Grants ? Public Assistance (Presidentially Declared Disasters) program were $96,563,597 and $63,845,975, respectively, for the year ended June 30, 2022. Cause: Although DEM has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year, subrecipient risk assessments were not completed and an adequate number of subrecipients were not monitored. Effect: DEM does not have proper internal controls in place to ensure policies and procedures surrounding the subrecipient monitoring compliance requirements are in effect. DEM does not have evidence to support appropriate subrecipient monitoring; therefore, management may not be able to identify issues in a timely manner. Recommendation: We recommend that DEM review policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure they are in compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.