2022-002 Eligibility Federal Agency: U.S. Department of Agriculture (USDA) Program: WIC Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) (ALN 10.557) Pass-through Entity: State of Minnesota, Department of Health Federal Assistance Identification Number or Pass-Through Number: 202MN004W1003, 192MN004W5003 Federal Award Year: Year ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must "Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." The County is responsible for the verification of an applicant?s categorical eligibility, identity, and residency as well as the performance of assessments of an applicant?s nutritional risk. In addition, the County is also responsible for the input of this information as well as income and family size into HuBERT, the State?s WIC Information System. Condition: While testing the eligibility requirement, we noted procedures and controls were not operating as designed to ensure that only those eligible were approved for WIC. In our sample of 40 cases, two cases had no evidence that an independent review of the eligibility determination occurred. In addition, while we were able to test manual compensating controls over eligibility determination, we were not able to review and test the automated application controls and the related information technology general controls (ITGCs) within the HuBERT system, a state system that is administered by the state and required to be used by the County for eligibility determination, to determine whether controls are adequately designed and implemented and operating effectively. Cause: The County lacks a workflow for the eligibility determination of the WIC program, including the completion of an independent review. The County currently utilizes Microsoft Teams for the caseworker to make a request for a Competent Professional Authority (CPA) to review a case after an eligibility determination is made. The caseworker is responsible for ensuring the review has occurred, but the only method of monitoring is reopening each case file for verification. In addition, the State was not able to provide information regarding the design and effectiveness of HuBERT system controls nor were we able to test those controls directly due to complexities of data privacy and resources within the State. Effect: Although not found during our testing, benefits disbursed to participants in the program and issued by the State of Minnesota may have paid for ineligible participants. Context: Out of the universe of cases eligible for assistance we noted that two out of our sample of 40 met eligibility requirements but had no evidence of an independent review of the eligibility determination. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Questioned Costs: None Repeat Finding?: No Recommendation: We recommend that the process for documenting the review of eligibility determinations be strengthened. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of HuBERT system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-003 Matching Federal Agency: U.S. Department of Housing and Urban Development Program: Continuum of Care Program (ALN 14.267) Federal Assistance Identification Number or Pass-Through Numbers: MN0311L5K002007, MN0364L5K002005, MN0372L5K002105 Federal Award Years: Year ended December 31, 2022; Year ended December 31, 2022; Year ended October 31, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a), requires that the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 578.73(a) requires that the recipient must match all grant funds, except for leasing funds, with no less than 25 percent of funds or in-kind contributions from other sources. For grantees where there is more than one grant agreement, the 25 percent match must be provided on a grant-by-grant basis. Cash match must be used for the costs of activities that are eligible as program costs under 24 CFR 578 Subpart D. 2 CFR 200.306(b)(1) requires that any shared costs or matching funds must be verifiable from the non-Federal entity's records. Condition: While testing the matching requirement, we noted that internal controls are not properly designed. While the County was able to provide documentation that the matching requirement was met, we noted the following: ? The documentation to demonstrate that the required match was met was on a calendar-year basis for all grants in total instead of on the required grant-by-grant basis. ? The data utilized in determining the match requirement was met was obtained from the State?s information system, MAXIS, and the County did not retain this data. ? Reporting of the match on the HUD Annual Performance Report is completed by multiplying the total direct costs by the required match percentage instead of the actual match. ? There was a lack of evidence that a supervisory review was periodically performed over matching. In addition, while we were able to test a manual compensating control over matching, we were not able to review and test the automated application controls and related ITGCs within the MAXIS system. The State was not able to provide information regarding the design and implementation of MAXIS system controls, nor were we able to test those controls directly. Cause: Historically the County has believed that the ability to demonstrate the match requirement was met was sufficient. There are no written policies and procedures over the review of the matching requirement. In addition, the State was not able to provide information regarding the design and implementation of MAXIS system controls nor were we able to review and test the MAXIS system due to complexities of data privacy and resources within the State. Effect: Without written policies and procedures over the review of the matching requirement and without documentation of the review, there is an increased risk of noncompliance with the matching requirement. Context: We reviewed the matching requirements for all awards for this ALN that required a match during the year. Questioned Costs: None Repeat Finding?: No Recommendation: We recommend that controls be established to include determination of the match on a on a grant-by-grant basis more often than annually, that documentation of this determination is retained in the County?s records, and that a review is performed and documented. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-005 Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Eligibility Federal Agency: U.S. Department of Health and Human Services Program: Foster Care Title IV-E (ALN 93.658) Pass-through Entity: State of Minnesota, Department of Human Services Federal Assistance Identification Number or Pass-Through Number: 2101MNFOST Federal Award Year: Year ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must ?Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.? Expenditures are to be made for allowable foster care activities and must be in accordance with 2 CFR Part 200, Subpart E. Foster care maintenance payments are allowable if the foster child is removed from home per the requirements of Section 406(a) of the Social Security Act and is placed into foster care by means of a judicial determination. Condition: While we were able to test manual compensating controls over activities allowed or unallowed, allowable costs/cost principles and eligibility, we were not able to review and test the automated application controls and the related ITGCs within the MAXIS and SSIS systems that reside within the State of Minnesota, but are utilized by the County, to determine whether the system controls are adequately designed and implemented and operating effectively. Cause: We were unable to review and test the controls within the MAXIS and SSIS systems due to complexities of data privacy and resources within the State. These systems are administered by the state and are required to be used by the County. In addition, the State was not able to provide information regarding the design and implementation of MAXIS and SSIS system controls. Effect: Although not found during our testing, benefits paid for participants in the program may have paid for ineligible participants. Context: Applies to the automated application controls over the population of expenditures and eligible participants within the program. Questioned Costs: None noted Repeat Finding?: No Recommendation: We suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS and SSIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-004 Eligibility Federal Agency: U.S. Department of Health and Human Services Program: Medical Assistance Program (ALN 93.778) Pass-through Entity: State of Minnesota, Department of Human Services Federal Assistance Identification Number or Pass-Through Numbers: 2005MN5ADM, 2105MN5ADM, 2105MN5MAP, NH23IP922628 Federal Award Years: Year ended December 31, 2022 Type of Finding: Material Weakness in Internal Control over Compliance; Other Matter Compliance Finding Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must "Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." Specific criteria are established with respect to eligibility for assistance and the County?s responsibilities related to the intake function: ? Minnesota Stat 256B.056 requires that for certain eligibility groups to be eligible for Medical Assistance, a person must not individually own more than certain asset limits based on household size, disability status, and employment status. ? The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is inconsistent with other information. ? Minnesota Stat 256B.056 requires to be eligible for Medical Assistance, a person must not have income in excess of certain limits based on household size. The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is consistent with documentation or information on file. ? 42 CFR 435.910 requires, as a condition of eligibility, each individual seeking Medicaid must furnish his or her Social Security number (SSN). Condition: During our testing, we noted the following instances of noncompliance in the sample of 120 case files tested: ? One MAXIS case file had assets greater than their applicable household size asset limit. While beneficiaries may reduce their assets to continue to qualify, there was no documentation in the case notes showing the applicant reduced their assets subsequent to renewal in order to continue to qualify for benefits. ? One MAXIS case file had different bases of eligibility in MAXIS and MMIS where MAXIS indicated the beneficiary was ?EX? (age 65 or older) while MMIS indicated the beneficiary was ?DX? (disabled). ? One METS case file included documentation of verification of income that did not match the information entered into METS. ? One METS case file did not have a SSN entered at either the initial application date nor any of the subsequent renewal dates. No exemptions to the requirement to submit a SSN was noted in the case within METS. In addition, the County does not have effective internal controls over eligibility of the Medicaid program: ? The County does not have a formalized supervisory case file review process in place to ensure accuracy and completeness of inputs into the MAXIS and METS systems. ? We were not able to review and test the automated application controls and the related ITGCs within the MAXIS, METS and MMIS systems, all of which are state systems that are administered by the state and required to be used by the County, to determine whether the system controls are adequately designed and implemented and operating effectively for the determination of eligibility. Cause: The County relied on the pandemic related continuous eligibility provisions for the Medical Assistance program. Program personnel entering case data into MAXIS or METS did not ensure all required information was input correctly, supported or that all required information was obtained. In addition, the State was not able to provide information regarding the design and implementation of MAXIS, METS and MMIS system controls nor were we able to review and test the MAXIS, METS and MMIS systems due to complexities of data privacy and resources within the State. Effect: Although not found during our testing, benefits paid for participants in the program by the State of Minnesota may have paid for ineligible participants. Context: The State of Minnesota Department of Human Services (DHS) contracts with county social services departments to perform the ?intake function? (meeting with the social services client to determine income and categorical eligibility), while the State maintains the MAXIS and METS systems, which determine eligibility. Participants receive benefit payments from the state. The eligible individuals consist of two populations, and a total of 120 enrolled persons were selected, 60 from the MAXIS system and another 60 from the METS system. The sample sizes were based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Of the 120 selections, errors were noted in four of the cases (see condition section above for more detail). Questioned Costs: None. The County only receives reimbursement for administrative costs of the program. All benefits paid to participants in the program are paid directly by the State of Minnesota. Repeat Finding?: No Recommendation: We recommend that the County designs internal controls to determine that inputs used to determine eligibility are correctly entered and the information required by the contract is retained in the County?s records. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS, METS and MMIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-002 Eligibility Federal Agency: U.S. Department of Agriculture (USDA) Program: WIC Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) (ALN 10.557) Pass-through Entity: State of Minnesota, Department of Health Federal Assistance Identification Number or Pass-Through Number: 202MN004W1003, 192MN004W5003 Federal Award Year: Year ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must "Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." The County is responsible for the verification of an applicant?s categorical eligibility, identity, and residency as well as the performance of assessments of an applicant?s nutritional risk. In addition, the County is also responsible for the input of this information as well as income and family size into HuBERT, the State?s WIC Information System. Condition: While testing the eligibility requirement, we noted procedures and controls were not operating as designed to ensure that only those eligible were approved for WIC. In our sample of 40 cases, two cases had no evidence that an independent review of the eligibility determination occurred. In addition, while we were able to test manual compensating controls over eligibility determination, we were not able to review and test the automated application controls and the related information technology general controls (ITGCs) within the HuBERT system, a state system that is administered by the state and required to be used by the County for eligibility determination, to determine whether controls are adequately designed and implemented and operating effectively. Cause: The County lacks a workflow for the eligibility determination of the WIC program, including the completion of an independent review. The County currently utilizes Microsoft Teams for the caseworker to make a request for a Competent Professional Authority (CPA) to review a case after an eligibility determination is made. The caseworker is responsible for ensuring the review has occurred, but the only method of monitoring is reopening each case file for verification. In addition, the State was not able to provide information regarding the design and effectiveness of HuBERT system controls nor were we able to test those controls directly due to complexities of data privacy and resources within the State. Effect: Although not found during our testing, benefits disbursed to participants in the program and issued by the State of Minnesota may have paid for ineligible participants. Context: Out of the universe of cases eligible for assistance we noted that two out of our sample of 40 met eligibility requirements but had no evidence of an independent review of the eligibility determination. The sample size was based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Questioned Costs: None Repeat Finding?: No Recommendation: We recommend that the process for documenting the review of eligibility determinations be strengthened. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of HuBERT system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-003 Matching Federal Agency: U.S. Department of Housing and Urban Development Program: Continuum of Care Program (ALN 14.267) Federal Assistance Identification Number or Pass-Through Numbers: MN0311L5K002007, MN0364L5K002005, MN0372L5K002105 Federal Award Years: Year ended December 31, 2022; Year ended December 31, 2022; Year ended October 31, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a), requires that the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 24 CFR 578.73(a) requires that the recipient must match all grant funds, except for leasing funds, with no less than 25 percent of funds or in-kind contributions from other sources. For grantees where there is more than one grant agreement, the 25 percent match must be provided on a grant-by-grant basis. Cash match must be used for the costs of activities that are eligible as program costs under 24 CFR 578 Subpart D. 2 CFR 200.306(b)(1) requires that any shared costs or matching funds must be verifiable from the non-Federal entity's records. Condition: While testing the matching requirement, we noted that internal controls are not properly designed. While the County was able to provide documentation that the matching requirement was met, we noted the following: ? The documentation to demonstrate that the required match was met was on a calendar-year basis for all grants in total instead of on the required grant-by-grant basis. ? The data utilized in determining the match requirement was met was obtained from the State?s information system, MAXIS, and the County did not retain this data. ? Reporting of the match on the HUD Annual Performance Report is completed by multiplying the total direct costs by the required match percentage instead of the actual match. ? There was a lack of evidence that a supervisory review was periodically performed over matching. In addition, while we were able to test a manual compensating control over matching, we were not able to review and test the automated application controls and related ITGCs within the MAXIS system. The State was not able to provide information regarding the design and implementation of MAXIS system controls, nor were we able to test those controls directly. Cause: Historically the County has believed that the ability to demonstrate the match requirement was met was sufficient. There are no written policies and procedures over the review of the matching requirement. In addition, the State was not able to provide information regarding the design and implementation of MAXIS system controls nor were we able to review and test the MAXIS system due to complexities of data privacy and resources within the State. Effect: Without written policies and procedures over the review of the matching requirement and without documentation of the review, there is an increased risk of noncompliance with the matching requirement. Context: We reviewed the matching requirements for all awards for this ALN that required a match during the year. Questioned Costs: None Repeat Finding?: No Recommendation: We recommend that controls be established to include determination of the match on a on a grant-by-grant basis more often than annually, that documentation of this determination is retained in the County?s records, and that a review is performed and documented. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-005 Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Eligibility Federal Agency: U.S. Department of Health and Human Services Program: Foster Care Title IV-E (ALN 93.658) Pass-through Entity: State of Minnesota, Department of Human Services Federal Assistance Identification Number or Pass-Through Number: 2101MNFOST Federal Award Year: Year ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must ?Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.? Expenditures are to be made for allowable foster care activities and must be in accordance with 2 CFR Part 200, Subpart E. Foster care maintenance payments are allowable if the foster child is removed from home per the requirements of Section 406(a) of the Social Security Act and is placed into foster care by means of a judicial determination. Condition: While we were able to test manual compensating controls over activities allowed or unallowed, allowable costs/cost principles and eligibility, we were not able to review and test the automated application controls and the related ITGCs within the MAXIS and SSIS systems that reside within the State of Minnesota, but are utilized by the County, to determine whether the system controls are adequately designed and implemented and operating effectively. Cause: We were unable to review and test the controls within the MAXIS and SSIS systems due to complexities of data privacy and resources within the State. These systems are administered by the state and are required to be used by the County. In addition, the State was not able to provide information regarding the design and implementation of MAXIS and SSIS system controls. Effect: Although not found during our testing, benefits paid for participants in the program may have paid for ineligible participants. Context: Applies to the automated application controls over the population of expenditures and eligible participants within the program. Questioned Costs: None noted Repeat Finding?: No Recommendation: We suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS and SSIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.
2022-004 Eligibility Federal Agency: U.S. Department of Health and Human Services Program: Medical Assistance Program (ALN 93.778) Pass-through Entity: State of Minnesota, Department of Human Services Federal Assistance Identification Number or Pass-Through Numbers: 2005MN5ADM, 2105MN5ADM, 2105MN5MAP, NH23IP922628 Federal Award Years: Year ended December 31, 2022 Type of Finding: Material Weakness in Internal Control over Compliance; Other Matter Compliance Finding Criteria: 2 CFR 200.303(a) requires that each non-Federal entity must "Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." Specific criteria are established with respect to eligibility for assistance and the County?s responsibilities related to the intake function: ? Minnesota Stat 256B.056 requires that for certain eligibility groups to be eligible for Medical Assistance, a person must not individually own more than certain asset limits based on household size, disability status, and employment status. ? The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is inconsistent with other information. ? Minnesota Stat 256B.056 requires to be eligible for Medical Assistance, a person must not have income in excess of certain limits based on household size. The Minnesota Health Care Programs Eligibility Policy Manual at 1.3.2.4 requires a County agency to evaluate and pursue resolution of information that is consistent with documentation or information on file. ? 42 CFR 435.910 requires, as a condition of eligibility, each individual seeking Medicaid must furnish his or her Social Security number (SSN). Condition: During our testing, we noted the following instances of noncompliance in the sample of 120 case files tested: ? One MAXIS case file had assets greater than their applicable household size asset limit. While beneficiaries may reduce their assets to continue to qualify, there was no documentation in the case notes showing the applicant reduced their assets subsequent to renewal in order to continue to qualify for benefits. ? One MAXIS case file had different bases of eligibility in MAXIS and MMIS where MAXIS indicated the beneficiary was ?EX? (age 65 or older) while MMIS indicated the beneficiary was ?DX? (disabled). ? One METS case file included documentation of verification of income that did not match the information entered into METS. ? One METS case file did not have a SSN entered at either the initial application date nor any of the subsequent renewal dates. No exemptions to the requirement to submit a SSN was noted in the case within METS. In addition, the County does not have effective internal controls over eligibility of the Medicaid program: ? The County does not have a formalized supervisory case file review process in place to ensure accuracy and completeness of inputs into the MAXIS and METS systems. ? We were not able to review and test the automated application controls and the related ITGCs within the MAXIS, METS and MMIS systems, all of which are state systems that are administered by the state and required to be used by the County, to determine whether the system controls are adequately designed and implemented and operating effectively for the determination of eligibility. Cause: The County relied on the pandemic related continuous eligibility provisions for the Medical Assistance program. Program personnel entering case data into MAXIS or METS did not ensure all required information was input correctly, supported or that all required information was obtained. In addition, the State was not able to provide information regarding the design and implementation of MAXIS, METS and MMIS system controls nor were we able to review and test the MAXIS, METS and MMIS systems due to complexities of data privacy and resources within the State. Effect: Although not found during our testing, benefits paid for participants in the program by the State of Minnesota may have paid for ineligible participants. Context: The State of Minnesota Department of Human Services (DHS) contracts with county social services departments to perform the ?intake function? (meeting with the social services client to determine income and categorical eligibility), while the State maintains the MAXIS and METS systems, which determine eligibility. Participants receive benefit payments from the state. The eligible individuals consist of two populations, and a total of 120 enrolled persons were selected, 60 from the MAXIS system and another 60 from the METS system. The sample sizes were based on guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Of the 120 selections, errors were noted in four of the cases (see condition section above for more detail). Questioned Costs: None. The County only receives reimbursement for administrative costs of the program. All benefits paid to participants in the program are paid directly by the State of Minnesota. Repeat Finding?: No Recommendation: We recommend that the County designs internal controls to determine that inputs used to determine eligibility are correctly entered and the information required by the contract is retained in the County?s records. In addition, we suggest that the County encourage the State to provide an independent audit of the design and implementation of MAXIS, METS and MMIS system controls. View of responsible officials of the auditee: Hennepin County has reviewed and agrees with the finding and recommendation.