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Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated January 27, 2026, titled Inadequate Internal Controls over Eligibility Determinations. LDH appreciates the opportunity to provide this response to y...
Dear Mr. Waguespack: The Louisiana Department of Health (LDH) acknowledges receipt of correspondence from the Louisiana Legislative Auditor (LLA) dated January 27, 2026, titled Inadequate Internal Controls over Eligibility Determinations. LDH appreciates the opportunity to provide this response to your office's findings. Finding: Inadequate Internal Controls over Eligibility Determinations. Recommendation: LDH should ensure its employees follow procedures and federal regulations relating to eligibility determinations and redeterminations in the Medicaid and CHIP programs to ensure the case records support the eligibility decisions. LDH Response: LDH concurs in part with LLA's finding of inadequate internal controls over eligibility determinations. For the Medicaid finding noted as not accurately processing SNAP renewal, LDH concurs in part. The eligibility determination system accurately processed the SNAP renewal as an administrative renewal. The issue identified was limited to inaccurate automated case note language. This documentation issue did not impact eligibility outcomes and was corrected effective December 2024. For the 12 Medicaid findings noted as not obtaining required determinations prior to renewing eligibility, LDH concurs. • Seven (7) findings occurred during the effective period of the $0 income waiver under Section 1902(e) (14) (A), and the system applied waiver-approved income verification logic consistent with LDH policy. Following the expiration of the waiver, system logic was updated and completed in August 2025 to align with post-waiver renewal requirements. • For one (1) finding verification was provided but not reflected in the case record due to analyst execution. This was discussed with the analyst on October 15, 2025. • For three (3) findings the system retained existing resource information when external asset verification interfaces returned no results, consistent with LDH Asset Verification System (AVS) policy and procedures designed to prevent the introduction of unverifiable data. System logic was updated and completed in October 2025. • For one (1) finding the system renewed eligibility consistent with existing renewal processing rules. LDH has reviewed this scenario and will evaluate whether additional procedural or system safeguards are appropriate. For the seven (7) Medicaid findings noted as not obtaining required determinations prior to renewing eligibility which resulted in beneficiaries being invalidly enrolled, LDH concurs in part. • Six (6) findings resulted in case analysts failing to properly follow policy/procedures prior to determining or continuing eligibility. Ongoing training is in progress. • For the finding noted as not documenting school enrollment for the beneficiary over age 18 on Children's Choice Waiver, LDH does not concur. School enrollment is not a condition of eligibility; therefore, LDH is not required to not verify school enrollment when determining eligibility. Children's Choice and Support Waiver programs are initiated by the Office of Citizen's with Developmental Disabilities (OCDD) who determines the appropriate waiver program for the beneficiary. (OCDD) notifies LDH of the necessary action or updates to the service type when a transition of waiver services takes place. For the three (3) CHIP findings noted as not accurately processing SNAP renewal, LDH concurs in part. The eligibility determination system accurately processed the SNAP renewal as an administrative renewal. The issue identified was limited to inaccurate automated case note language. This documentation issue did not impact eligibility outcomes and was corrected effective December 2024. For the 10 CHIP findings noted as not obtaining required documentation prior to renewing eligibility, LDH concurs. • Seven (7) findings occurred during the effective period of the $0 income waiver under Section 1902(e) (14) (A), and the system applied waiver-approved income verification logic consistent with LDH policy. Following expiration of the waiver, system logic was updated in July 2025 to align with post-waiver renewal requirements. • Two (2) findings, the system completed renewals consistent with interface results available at the time of processing. The case record reflected unemployment income; however, interfaces returned no income found. • One (1) finding the analyst did not verify reported income in adherence with policy and procedures. For the 10 CHIP findings noted as not obtaining required documentation prior to renewing eligibility which resulted in beneficiaries being invalidly enrolled, LDH concurs in part. • Two (2) findings, the system completed renewals consistent with interface results available at the time of processing. The case record reflected unemployment income; however, interfaces returned no income found. This system enhancement is in progress. • Four (4) findings the analyst did not obtain required income verification in adherence with policy and procedures. Training is ongoing. • One (1) finding did not address unemployment income and household discrepancy. The system completed renewals consistent with interface results available at the time of processing. The case record reflected unemployment income; however, interfaces returned no income found. The clerical staff failed to remove a beneficiary from the household during data entry. Training is ongoing. • One (1) finding occurred during the effective period of the $0 income waiver under Section 1902(e) (14) (A), and the system applied waiver-approved income verification logic consistent with LDH policy. Following expiration of the waiver, system logic was updated in August 2025 to align with post-waiver renewal requirements. • For the two (2) findings noted as not counting all active income found in interfaces, LDH does not concur. The eligibility determination system utilized the highest income reported by LWC at the time of case processing, consistent with LDH policy. Corrective Actions: LDH will continue to utilize findings from internal case reviews, appeal outcomes, external audit, and other monitoring activities to perform root cause analysis. Where appropriate, LDH has requested system enhancements and will continue to assess system functionality in coordination with Policy, Procedures, and Legal to ensure alignment with program requirements and program integrity. To reduce recurrence of identified case processing trends, LDH will continue to: • Assess and update policy and procedures as needed. Provide refresher training for staff. • Conduct internal supervisory and quality assurance reviews. These actions are intended to strengthen internal controls while maintaining alignment with federal and state requirements. You may contact Seth Gold, Medicaid Director at (225) 219-7810 or via e-mail at Seth.Gold@la.gov or Camille Conaway, Executive Director Economic Independence via e-mail at Camille.Conaway@la.gov with any questions about this matter.
Dear Mr. Waguespack, Capital Area Human Services District (CAHSD) concurs in part with the finding regarding inadequate controls over and noncompliance with Activities Allowed and Unallowed Requirements under the Substance Use Prevention, Treatment, and Recovery Services Block Grant (SUBG) program. ...
Dear Mr. Waguespack, Capital Area Human Services District (CAHSD) concurs in part with the finding regarding inadequate controls over and noncompliance with Activities Allowed and Unallowed Requirements under the Substance Use Prevention, Treatment, and Recovery Services Block Grant (SUBG) program. CAHSD has adequate controls in place to review employees’ job functions to ensure compliance with the purpose of the SUBG program and allowability under grant requirements An employee was promoted into a position that had previously been funded by the SUBG program; however, the payroll coding was not updated to reflect the correct funding source. Although updated coding information was provided, the payroll system was not revised accordingly. Upon review of SUBG program expenditures, it was determined that the employee’s funding source had not been properly updated within the payroll system. A payroll correction was subsequently processed and completed on November 17, 2025, to ensure the funding source was accurately reflected. CAHSD is committed to strengthening its internal control environment and ensuring full compliance with all federal grant requirements. As a corrective action plan, CAHSD will implement periodic internal reviews of grant expenditures to ensure continued compliance. A review of expenditures and coding will be completed by April 15, 2026. Any discrepancies identified will be promptly corrected and documented. The CAHSD Accountant Administrator, Linda Roquemore, under the direction of Deputy Director, Ms. Shaketha Carter will be responsible for ensuring implementation of this corrective action plan to ensure utilization of the correct statistical internal order numbers within the LaGov accounting system.
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance with and Control Weaknesses over Foster Care Requirements”. DCFS continually strives to enhance its internal processes and controls and remains co...
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Noncompliance with and Control Weaknesses over Foster Care Requirements”. DCFS continually strives to enhance its internal processes and controls and remains committed to implementing corrective actions to ensure compliance with federal and state regulations. As part of our corrective action plan for this finding, DCFS is updating policy and practice to ensure that the retention of documentation associated with criminal records checks and the State Central Registry Clearances for foster/adoptive caregivers are clearly addressed in policy. Policy related to the retention of documentation related to these checks will be reviewed with all DCFS staff in the monthly policy meeting. DCFS will develop and implement training specifically for Home Development staff. This training will address the proper completion of required forms as well as the retention of criminal records checks and State Central Registry Clearances following closure of the foster/adoptive caregiver's home. The anticipated date of completion is June 30, 2026. DCFS is strengthening internal controls by modernizing the authorization process to require digital approvals. This system upgrade will mandate that service authorizations are finalized before services begin, ensuring all Foster Care payments align with federal and state eligibility requirements. Furthermore, the digital platform will centralize documentation tracking, ensuring continuity of records and compliance even during staff transitions or vacancies. Training will be provided to all Child Welfare administrative and professional-level staff on the new process. The anticipated date of completion is June 30, 2026. Should you require additional information, please contact Connie Guillory, Assistant Secretary of Child Welfare, at 337-793-0017 or Connie.Guillory.DCFS@LA.GOV.
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness over Temporary Assistance for Needy Families Eligibility Requirements”. DCFS continually strives to enhance its internal processes and controls...
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness over Temporary Assistance for Needy Families Eligibility Requirements”. DCFS continually strives to enhance its internal processes and controls and remains committed to implementing corrective actions to ensure compliance with federal and state regulations. Although the exceptions noted occurred during the prior period under DCFS, the Louisiana Department of Health (LDH) began administration of the Family Independence Temporary Assistance Program (FITAP) and Kinship Care Subsidy Program (KCSP) programs effective October 1, 2025, and proposed the following continuous corrective actions that include formal coaching and active monitoring through supervisory case reviews. LDH will conduct formal coaching to ensure staff are aware of their responsibilities. This formal coaching will be mandated for eligibility staff identified as inaccurately budgeting income or entering incorrect disability coding, emphasizing the importance of precise and accurate income budgeting and data entry. In addition to routine case reviews, LDH Supervisors will conduct three additional case reviews for three months as continuous monitoring and corrective measures. DCFS TANF Consultant will monitor LDH to ensure the corrective action plan is fully executed. Should you require additional information, please contact Charles Watkins, Assistant Secretary of Family Support at Charles.Watkins.DCFS@LA.GOV.
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness and Noncompliance Related to Cost Allocation Process.” DCFS continually strives to enhance its internal processes and controls and remains comm...
Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) acknowledges receipt and concurs with the audit finding titled, “Control Weakness and Noncompliance Related to Cost Allocation Process.” DCFS continually strives to enhance its internal processes and controls and remains committed to implementing and maintaining corrective actions to ensure compliance with federal and state regulations. DCFS concurs that instances were identified where cost allocation forms did not align with supporting documentation, utilizing incorrect grant numbers, and/or referencing federal programs not included in the approved Cost Allocation Plan (CAP). While the identified costs were not material in terms of amount, management recognizes the importance of maintaining effective internal controls to ensure that costs are allocated in accordance with federal requirements and the CAP. Corrective Action Plan DCFS is strengthening internal controls over the cost allocation review process to reduce the risk of future errors and improve compliance. Corrective actions include the following: • Corrective Action Planned: DCFS will enhance its review procedures for cost allocation forms by implementing additional supervisory review before posting, reinforcing documentation requirements, and providing refresher guidance to staff responsible for preparing and reviewing cost allocation entries. Management will also perform periodic monitoring reviews to ensure allocations are consistent with the approved CAP and supported by appropriate documentation. • Responsible Contact(s): Tonja Jones, Cost Allocation Manager, Office of Management and Finance Angela Hebert, Fiscal Director, Office of Management and Finance • Anticipated Completion Date: June 30, 2026 DCFS believes these actions will strengthen internal controls and address the deficiencies noted in the finding. Management will continue to monitor the effectiveness of these controls to ensure sustained compliance.
Audit Period: Year End June 30, 2024 The Road Home Corporation d/b/a Louisiana Land Trust (LLT) respectively submits the following corrective action plan for the year ended June 30, 2024. Condition: Louisiana Land Trust (LLT) does not have adequate controls in place to ensure that LLT credit card tr...
Audit Period: Year End June 30, 2024 The Road Home Corporation d/b/a Louisiana Land Trust (LLT) respectively submits the following corrective action plan for the year ended June 30, 2024. Condition: Louisiana Land Trust (LLT) does not have adequate controls in place to ensure that LLT credit card transactions and bank accounts are properly monitored and comply with its own policies and federal program regulations, increasing the risk of theft and fraud. Actions to be taken – 1. Management concurs and has taken action to make certain that all credit card transactions/ statements as well as all bank accounts are monitored on a regular basis to ensure that each account reconciles properly. 2. Management has changed its internal procedures and reassigned responsibilities to staff to help ensure proper checks and balance take place on a regular basis. 3. Management has worked with our new outside CPA firm to integrate all accounts into our bookkeeping system to allow for automatic transaction reconciliations. If there are any questions regarding the actions taken, please feel free to reach out and let me know.
Responsible Individual: Interim School Board Members Corrective Action Plan: The Interim Board of Directors will continue to monitor spending and expenditures charged to the Administrative Cost Grants for Indian Schools, until a newly elected Board of Directors is in place. The Interim Board will pr...
Responsible Individual: Interim School Board Members Corrective Action Plan: The Interim Board of Directors will continue to monitor spending and expenditures charged to the Administrative Cost Grants for Indian Schools, until a newly elected Board of Directors is in place. The Interim Board will provide necessary training to the newly elected Board of Directors. Anticipated Completion Date: June 30, 2026
Responsible Individual: Anthony Muilenburg, Business Manager Corrective Action Plan: The Business Manager will continue to review payroll and verify accuracy by reconciling reports to employee timesheets Anticipated Completion Date: Ongoing
Responsible Individual: Anthony Muilenburg, Business Manager Corrective Action Plan: The Business Manager will continue to review payroll and verify accuracy by reconciling reports to employee timesheets Anticipated Completion Date: Ongoing
Allowable Costs/Cost Principles Management agrees with the finding. One subrecipient billed expenses which were unallowable based on budget narrative line-item amounts. Management now closely reviews subrecipient invoices to ensure proper documentation and alignment with approved budget balances.
Allowable Costs/Cost Principles Management agrees with the finding. One subrecipient billed expenses which were unallowable based on budget narrative line-item amounts. Management now closely reviews subrecipient invoices to ensure proper documentation and alignment with approved budget balances.
To strengthen compliance moving forward, the newly appointed Federal Programs Coordinator has attended a federal programs conference, and the Treasurer has completed grants management training through OASBO. The District will continue to pursue ongoing training opportunities to ensure adherence to f...
To strengthen compliance moving forward, the newly appointed Federal Programs Coordinator has attended a federal programs conference, and the Treasurer has completed grants management training through OASBO. The District will continue to pursue ongoing training opportunities to ensure adherence to federal grant requirements, including proper allowability, documentation, and internal controls over disbursements.
Finding Number: 2025-047 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid intermediate care facilities. Program: 93.775 – State Medicaid Fraud Control...
Finding Number: 2025-047 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid intermediate care facilities. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Standards Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Department partially concurs with the finding. The Department was not able to meet the Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF-IID) survey requirements due to a backlog from prior years, not because of lack of internal controls. It was through applied internal controls that we identified concerns and were able to allocate resources to address the most serious concerns. The Department has made efforts since fiscal year 2023 to address the backlog of complaints and recertification surveys, but resources had to be prioritized to handle new complaints. There is only one team that manages surveys, complaints, and revisits for the entire state. To optimize the use of resources, the Field Manager meets with the Administrative Assistant on a quarterly basis to review the 365-day average report and determine if survey schedules need to be modified to meet federal requirements. To continue to address this audit issue, Regional Administrators have met with their ICF-IID teams to review survey scheduling for the year to ensure teams will be able to meet targeted survey completion dates and the required recertification timeframes. As of November 2025, the Department met compliance with the 15.9-month recertification survey interval measure based on the 2025 CMS State Performance Measurement Report. By August 2026, the Department expects to meet compliance with the 12.9-month statewide average. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-078, 2023-078, 2020-053, 2019-061, 2018–052, 2017-042, 2016-037, 2015-045, and 2014-046. Completion Date: Estimated August 2026 Agency Contact: Richard Meyer External Compliance Audit Manager Richard.Meyer@dshs.wa.gov
Finding Number: 2025-046 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Program: 93.775 – State Medicaid Fraud Control Units 93.777 –...
Finding Number: 2025-046 Finding: The Department of Social and Health Services, Home and Community Living Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Health and Safety Standards Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Department partially concurs with the finding. The Department was not able to meet the Nursing Home survey requirements due to a backlog from prior years, not because of lack of internal controls. It was through applied internal controls that we identified concerns and were able to allocate resources to address the most serious concerns. The Department has made efforts since fiscal year 2023 to address the backlog of complaints and recertification surveys, but resources had to be prioritized to handle new complaints. There is only one team that manages surveys, complaints, and revisits for the entire state. To optimize the use of resources, the Field Manager meets with the Administrative Assistant on a quarterly basis to review the 365-day average report and determine if survey schedules need to be modified to meet federal requirements. To continue to address this audit issue, Regional Administrators have met with their Nursing Home teams to review survey scheduling for the year to ensure teams will be able to meet targeted survey completion dates and the required recertification timeframes. As of November 2025, the Department met compliance with the 15.9-month recertification survey interval measure based on the 2025 CMS State Performance Measurement Report. By August 2026, the Department expects to meet compliance with the 12.9-month statewide average. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-079, 2023-079, and 2020-054. Completion Date: Estimated August 2026 Agency Contact: Richard Meyer External Audit Compliance Manager Richard.Meyer@dshs.wa.gov
Finding Number: 2025-041 Finding: The Health Care Authority improperly charged $5,634,756 to the Medicaid Program. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID...
Finding Number: 2025-041 Finding: The Health Care Authority improperly charged $5,634,756 to the Medicaid Program. Program: 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Questioned Costs: $5,634,756 Status: Corrective action in progress Corrective Action: The Authority concurs with the finding. The Authority identified the error prior to the audit and added a review of the payment methodology to ProviderOne regression testing scenarios for future years to prevent the error from reoccurring. The Authority is in the process of recouping funds from providers and returning the federal share of the payments. The Authority will work with the Centers for Medicare & Medicaid Services to confirm the funds were returned. Prior Findings: None Completion Date: Estimated July 2026 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov
Finding Number: 2025-040 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Program: 93.767 – Children's Health Insurance Program 93.767 – COVID-19 Children's Health Insurance Program 93.775 – State Medic...
Finding Number: 2025-040 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Program: 93.767 – Children's Health Insurance Program 93.767 – COVID-19 Children's Health Insurance Program 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Managed Care Financial Audit Questioned Costs: $0 Status: Corrective action complete Corrective Action: In January 2025, the Authority implemented new contract language requiring Managed Care Organizations (MCOs) to submit audited financial reports in accordance with Generally Accepted Accounting Principles (GAAP) and Generally Accepted Auditing Standards (GAAS). MCOs are required to submit the GAAP and GAAS statements beginning with the June 2026 submission. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-074, 2023-073, 2022-054, and 2021-048. Completion Date: January 2025 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov
Finding Number: 2025-039 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with federal provider eligibility requirements for the Medicaid and Children’s Health Insurance Program. Program: 93.767 – Children’s Health Insurance Program 93.767 – COVID-19...
Finding Number: 2025-039 Finding: The Health Care Authority did not have adequate internal controls over and did not comply with federal provider eligibility requirements for the Medicaid and Children’s Health Insurance Program. Program: 93.767 – Children’s Health Insurance Program 93.767 – COVID-19 Children’s Health Insurance Program 93.775 – State Medicaid Fraud Control Units 93.777 – State Survey and Certification of Health Care Providers and Suppliers 93.778 – Grants to States for Medicaid 93.778 – COVID-19 Grants to States for Medicaid Compliance Requirement: Special Tests and Provisions – Provider Eligibility (Screening and Enrollment) Questioned Costs: $641 Status: Corrective action in progress Corrective Action: The Authority partially concurs with the finding. Fingerprint based criminal background checks The Authority concurs that a fingerprint-based criminal background check process for high-risk providers was not implemented during the audit period. In coordination with the Centers for Medicare & Medicaid Services (CMS) and the Washington State Patrol, the Authority has developed the required process and is in the final stages of implementation. The program is expected to be launched by March 31, 2026, and will apply to all providers designated as high-risk. Updated license information in ProviderOne When a professional license on a provider record expires, ProviderOne automatically end-dates taxonomies associated with the provider. However, when a provider is enrolled with multiple agencies and only one associated license has expired, the system does not currently end-date the related taxonomies. Currently, 37 of 113,940 servicing-only providers are affected while none of the approximately 9,000 billing providers are impacted. The Authority submitted a system change request in March 2026 to ensure applicable taxonomies are automatically end-dated in these scenarios. In the interim, the Authority developed a weekly report and implemented a process to identify providers with applicable taxonomies that need manually end-dated until the system enhancement is deployed. ProviderOne did not deactivate providers timely ProviderOne is designed to automatically inactivate a provider’s domain when revalidation is not completed timely. Due to an operational issue, a limited number of providers were not deactivated as required. Currently, 50 of approximately 9,000 billing providers are impacted. The Authority submitted a system change request in March 2026 to remediate this issue and prevent recurrence. In the interim, the Authority will conduct weekly monitoring and manually inactivate affected provider domains until the system correction is implemented. Ownership disclosures The Authority does not concur with the determination that it is not in compliance with federal requirements governing ownership disclosures. The Authority’s process requires providers to review and attest to ownership disclosure information maintained by the Authority as part of the revalidation process. The Authority believes this process meets the requirements of 42 CFR 455.104 and appropriately balances regulatory compliance with administrative efficiency. The Authority submitted its procedures to CMS on February 23, 2026, and requested clarification and guidance to ensure continued alignment with federal expectations. Providers not revalidated or deactivated by the five-year deadline The Authority’s revalidation backlog totaled 792 providers in July 2024. Through focused operational improvements and targeted resource deployment, the backlog was substantially reduced to three providers as of June 30, 2025. The Authority remains committed to continuous process improvement to sustain timely revalidations and prevent future backlog growth. As of March 2026, the Authority began working on a daily report of providers nearing the revalidation deadline so they can be prioritized and revalidated timely. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-075, 2023-074, 2022-055, 2021-047, 2020-046, 2019-048, 2018-042, 2017-033, and 2016-035. Completion Date: Estimated March 2026 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager (360) 725-9586 Kari.Summerour@hca.wa.gov
Finding Number: 2025-035 Finding: The Department of Children, Youth, and Families improperly charged $543,205 to the Child Care Development Fund program. Program: 93.575 – Child Care and Development Block Grant 93.575 – COVID-19 Child Care and Development Block Grant 93.596 – Child Care Mandatory an...
Finding Number: 2025-035 Finding: The Department of Children, Youth, and Families improperly charged $543,205 to the Child Care Development Fund program. Program: 93.575 – Child Care and Development Block Grant 93.575 – COVID-19 Child Care and Development Block Grant 93.596 – Child Care Mandatory and Matching Funds of the Child Care and Development Fund Compliance Requirement: Period of Performance Questioned Costs: $543,205 Status: Corrective action not taken Corrective Action: The Department does not agree with the State Auditor’s Office (SAO) finding that $543,205 in expenditures were improperly charged to the Child Care and Development Fund (CCDF) grants during fiscal year 2025. The Department utilizes grant-level management for all federal funds and makes grant adjustments between allowable grant sources to properly spend grant dollars within the allowable period of performance. The questioned costs reported by the auditors were proper charges and met period of performance requirements, as follows: • $169,052 were expenditures charged to the CCDF grant prior to the grant start date but were later corrected in state fiscal year 2026. The Department provided documentation showing the adjustment, but it was not considered by SAO because the correction occurred outside the audit period. • $6,152 were questioned costs for the federal fiscal year 2024 CCDF grant which were applied as offset to recoveries in the correct period. All funds were appropriately documented and returned to the federal grantor as evidenced in the quarterly claims. Expenditures were obligated and expended within the allowable grant period. • $368,001 were initial expenditures recorded in the proper liquidation period that were charged to the CCDF Discretionary grant. The Department then processed an accounting adjustment in September 2024 to leverage the available grants’ funds per our grant-level management practice. Although the adjustment was processed in calendar month October 2024, it was recorded in the proper fiscal month in accordance with state financial reporting standards. When the Department of Health and Human Services (HHS) issues a management decision letter for the fiscal year 2025 finding, the Department will work with HHS and follow the audit resolution process. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-058, 2023-061, 2022-043, 2021-037, and 2020-041. Completion Date: Not applicable Agency Contact: Stefanie Niemela External Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
Finding Number: 2025-034 Finding: The Department of Children, Youth, and Families improperly charged $9,980 to the Child Care and Development Fund. Program: 93.575 – Child Care and Development Block Grant 93.575 – COVID-19 Child Care and Development Block Grant 93.596 – Child Care Mandatory and Matc...
Finding Number: 2025-034 Finding: The Department of Children, Youth, and Families improperly charged $9,980 to the Child Care and Development Fund. Program: 93.575 – Child Care and Development Block Grant 93.575 – COVID-19 Child Care and Development Block Grant 93.596 – Child Care Mandatory and Matching Funds of the Child Care and Development Fund Compliance Requirement: Eligibility Questioned Costs: $9,980 Status: Corrective action complete Corrective Action: The Department concurs that federal funds were incorrectly used for one client who should have been paid with state funds. As stated in the finding, all clients sampled for audit testing met the eligibility requirements for the Working Connections Child Care program, meaning they were deemed eligible for subsidy payment. However, one client that was determined to be eligible for state funding was paid with federal funds. This was the result of a system coding error in the Payment Allocation Model (PAM) process that led to the wrong source of funds being used for the client. In November 2025, the Department corrected the PAM coding to prevent further occurrences of this specific error. In February 2026, the Department: • Processed an accounting adjustment returning the federal funds that were paid by error to the Child Care and Development Fund grant. • Implemented a monthly quality assurance review process in collaboration with the Department of Social and Health Services where a sample of PAM allocations will be reviewed for accuracy. Prior Findings: None Completion Date: February 2026 Agency Contact: Stefanie Niemela External Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
Finding Number: 2025-033 Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers for the Child Care and Development Fund program were allowable and properly supported. Progra...
Finding Number: 2025-033 Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers for the Child Care and Development Fund program were allowable and properly supported. Program: 93.575 – Child Care and Development Block Grant 93.575 – COVID-19 Child Care and Development Block Grant 93.596 – Child Care Mandatory and Matching Funds of the Child Care and Development Fund Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Questioned Costs: $3,827 Status: Corrective action in progress Corrective Action: The Department agrees with the 11 audit exceptions identified by the State Auditor’s Office resulting from testing of attendance records and documentation from providers. In February 2026, the Department wrote overpayments for the exceptions identified and submitted them for recovery to the Department of Social and Health Services, Office of Financial Recovery. The Department will: • Develop a decision package to request funding for options to increase internal controls for provider payments. • Update the Child Care Subsidy Program Integrity Plan and the quality assurance audit procedures to align with current practices. When the Department of Health and Human Services (HHS) issues a management decision letter for the fiscal year 2025 finding, the Department will work with HHS and follow the audit resolution process. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-056, 2023-058, 2022-041, 2021-033, 2020-038, 2019-035, 2018-034, 2017-024, 2016-021, 2015-023, 2014-023, 2013-016, 12-28, 11-23, 10-31, 9-12, and 8-13. Completion Date: Estimated October 2026 Agency Contact: Stefanie Niemela External Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
Finding Number: 2025-004 Finding: The University of Washington did not have adequate internal controls over and did not comply with federal requirements to ensure subrecipients of the Research & Development programs received required single audits, and that it appropriately followed up on findings a...
Finding Number: 2025-004 Finding: The University of Washington did not have adequate internal controls over and did not comply with federal requirements to ensure subrecipients of the Research & Development programs received required single audits, and that it appropriately followed up on findings and issued management decisions. Program: Research and Development Cluster Compliance Requirement: Subrecipient Monitoring Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The University’s Office of Sponsored Programs uses an Excel workbook to track subrecipients’ single audits and identify any findings related to university subawards. In early 2025, the University began transitioning to a new tracking spreadsheet with updated fields to capture relevant data for each subrecipient. The University is working on completing this transition and ensuring that all subrecipients with expenditures in the last fiscal year are included. To address the audit recommendations, the University will strengthen internal controls over subrecipient monitoring by: • Obtaining annual single audit reports timely for review and to follow up with subrecipients as needed. • Maintaining required information on the tracking sheet, including documentation of review of single audit reports. • Developing a schedule to obtain subrecipients’ single audit reports from the Federal Audit Clearinghouse to identify subrecipients with single audit findings related to university subawards. • Ensuring written management decisions are issued for all applicable audit findings within the required timeframe. Prior Findings: None Completion Date: Estimated July 2026 Agency Contact: Erick Winger Controller (206) 543-5322 erickw@uw.edu
Finding Number: 2025-010 Finding: The University of Washington did not have adequate internal controls over and did not comply with federal requirements to ensure salaries and wages charged to federal awards for the Research and Development programs were allowable and adequately supported. Program: ...
Finding Number: 2025-010 Finding: The University of Washington did not have adequate internal controls over and did not comply with federal requirements to ensure salaries and wages charged to federal awards for the Research and Development programs were allowable and adequately supported. Program: Research and Development Cluster Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Questioned Costs: $17,191 Status: Corrective action in progress Corrective Action: As of February 2026, the payroll exceptions identified by the auditors were reviewed by the applicable principal investigator and effort certification statements were completed. To address the audit recommendations, the University will strengthen internal controls and take the following corrective actions: • Expand the escalation process for past-due certifications to involve the University’s senior level leadership. • Implement enforcement procedures in instances of non-compliance such as limiting access to funding or restricting proposal submission. • Develop additional training on reporting and effort certification tools, and implement a process for the central office to establish and track retraining requirements. • Improve automated system notifications for effort coordinators and certifiers. The University will notify federal grantor(s) for each exception to provide an update on the resolution of the exception and the status of the corrective action plan. Prior Findings: None Completion Date: Estimated June 2026 Agency Contact: Erick Winger Controller (206) 543-5322 erickw@uw.edu
Finding Number: 2025-038 Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to providers were allowable and properly supported for the Social Services Block grant. Program: 93.667 – Social Services Block Grant Compliance Requirement: A...
Finding Number: 2025-038 Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to providers were allowable and properly supported for the Social Services Block grant. Program: 93.667 – Social Services Block Grant Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Period of Performance Questioned Costs: $1,872,842 Status: Corrective action complete Corrective Action: The Department does not agree that expenditures were improperly charged to the Social Services Block Grant (SSBG) program during fiscal year 2025. Since November 2024, the Department has limited journal voucher (JV) activities and manually processed these transfer JVs at the transaction-level by grant funding sources. This action was taken in response to prior year’s audit concern that the SSBG program was not auditable without transaction-level data. The amount of questioned costs reported on this audit finding were based on the following JVs that were processed by the Department during the fiscal year: • $1,419,561 were grant level adjustments made for allowable activities per the SSBG expenditure plan. • $505,707 was a portion of an accrual JV that the Department processed during the 2025 state fiscal year close and represented an estimate of the amount the Department may spend within the allowable timeframe, not the actual amount charged to the grant. Accruals are estimated outstanding costs that are included as part of the state’s year end closing process. When the Department of Health and Human Services (HHS) issues a management decision letter for the fiscal year 2025 finding, the Department will work with HHS and follow the audit resolution process. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-072 and 2023-070. Completion Date: February 2026 Agency Contact: Stefanie Niemela External Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
Finding Number: 2025-037 Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure Foster Care Maintenance payment rates were properly calculated. Program: 93.658 – Foster Care Title IV-E Compliance Requiremen...
Finding Number: 2025-037 Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure Foster Care Maintenance payment rates were properly calculated. Program: 93.658 – Foster Care Title IV-E Compliance Requirement: Special Tests and Provisions – Payment Rate Setting and Application Questioned Costs: $0 Status: Corrective action in progress Corrective Action: The Department concurs that policies and procedures related to rate setting for Foster Care maintenance payments are not currently established and is committed to strengthening internal controls and complying with federal requirements. In February 2025, the Department met with the State Auditor’s Office to gather an understanding of concerns and discuss how reasonable and allowable rates could be documented to ensure federal compliance. In July 2025, the Department began drafting the written policies and procedures for setting payment rates to ensure maintenance payment rates only include allowable costs. The Department will continue to follow internal processes to complete the payment and rate setting policies and procedures. Prior Findings: The conditions noted in this finding were previously reported in finding 2024-071. Completion Date: Estimated July 2026 Agency Contact: Stefanie Niemela Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
Finding Number: 2025-030 Finding: The Department of Commerce improperly charged $131,015 to the Low-Income Home Energy Assistance Program. Program: 93.568 – Low-Income Home Energy Assistance Program Compliance Requirement: Period of Performance Questioned Costs: $131,015 Status: Corrective action in...
Finding Number: 2025-030 Finding: The Department of Commerce improperly charged $131,015 to the Low-Income Home Energy Assistance Program. Program: 93.568 – Low-Income Home Energy Assistance Program Compliance Requirement: Period of Performance Questioned Costs: $131,015 Status: Corrective action in progress Corrective Action: The Department agrees that internal controls should be strengthened for the review and approval of administrative expenses. The Low-Income Home Energy Assistance Program (LIHEAP) management is working with accounting, budget, and the internal controls departments to create a process and workflow in which all LIHEAP administrative expenditures are reported, reviewed, and approved to ensure all expenditures are within the applicable period of performance and are adequately documented. However, the Department disagrees with the questioned costs identified in the finding and maintains that they were expended in compliance with the Code of Federal Regulations and the guidance provided by the U.S. Department of Health and Human Services (HHS). The Department will consult with HHS on the questioned costs identified in the finding. Prior Findings: The conditions noted in this finding were previously reported in finding 2024-050. Completion Date: Estimated September 2026 Agency Contact: Gena Allen, CFE Internal Control Officer (360) 480-5149 Gena.Allen@Commerce.wa.gov
Finding Number: 2025-026 Finding: The Department of Social and Health Services did not have adequate internal controls to ensure only eligible clients received cash benefits under the Refugee and Entrant Assistance program and improperly charged $4,440 to the program. Program: 93.566 – Refugee and E...
Finding Number: 2025-026 Finding: The Department of Social and Health Services did not have adequate internal controls to ensure only eligible clients received cash benefits under the Refugee and Entrant Assistance program and improperly charged $4,440 to the program. Program: 93.566 – Refugee and Entrant Assistance State/Replacement Designee Administered Programs Compliance Requirement: Eligibility Questioned Costs: $4,440 Status: Corrective action in progress Corrective Action: The Department concurs with the finding. As of October 2025, the Department requested the ESA Management Analytics and Performance Statistics (EMAPS) team to generate a report detailing all eligibility determinations made in the six weekly periods that were found to be lacking managerial review. As of November 2025, the Department submitted a formal EMAPS work request to develop a Refugee Cash Assistance (RCA) flagged eligibility caseload report. In addition to metrics already reviewed, this report includes a metric to flag cases where the “U.S. entry date” field has been modified. As of January 2026, the Department: • Developed, documented, and implemented a comprehensive process for managerial reviews of flagged eligibility caseload reports, including a backup process in the absence of the primary reviewer. • Developed and implemented a formal oversight process to monitor the completion and documentation of managerial reviews of all flagged eligibility caseload reports. This process will include a recurring check or log to ensure 100% compliance. • Revised the existing RCA desk aid to provide additional training and guidance to eligibility staff, clarifying the appropriate determination of the RCA eligibility period. The desk aid will specifically include instructions that staff are not to change the original date entered in the “U.S. entry date” field when a client leaves and reenters the country. As of March 2026, the Department reviewed the EMAPS reports to identify and correct any eligibility determination errors. By April 2026, the Department will develop and implement a tracking method to ensure all appropriate eligibility staff are trained on the revised RCA desk aid to ensure alignment with policy and procedures. If the grantor contacts the Department regarding the questioned costs identified in this finding, the Department will consult with the grantor to determine whether repayment is required. Prior Findings: None Completion Date: Estimated April 2026 Agency Contact: Richard Meyer External Audit Compliance Manager Richard.Meyer@dshs.wa.gov
Finding Number: 2025-025 Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and properly supported. Program: 93.558 – Temporary Assistance f...
Finding Number: 2025-025 Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and properly supported. Program: 93.558 – Temporary Assistance for Needy Families Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Cost Principles Questioned Costs: $2,296 Status: Corrective action in progress Corrective Action: The Department agrees with the three audit exceptions identified by the State Auditor’s Office resulting from testing of attendance records and documentation from providers. In February 2026, the Department wrote overpayments for the exceptions identified and submitted them for recovery to the Department of Social and Health Services, Office of Financial Recovery. The Department will: • Develop a decision package to request funding for options to increase internal controls for provider payments. • Update the Child Care Subsidy Program Integrity Plan and quality assurance audit procedures to align with current practices When the Department of Health and Human Services (HHS) issues a management decision letter for the fiscal year 2025 finding, the Department will work with HHS and follow the audit resolution process. Prior Findings: The conditions noted in this finding were previously reported in findings 2024-042, 2023-051, 2022-035, and 2021-028. Completion Date: Estimated October 2026 Agency Contact: Stefanie Niemela External Audit Liaison (360) 725-4402 stefanie.niemela@dcyf.wa.gov
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