Corrective Action Plans

Finding 397866 (2023-001)

Material Weakness 2023

Msad #27

ME

Questioned Costs Special Tests & Provisions Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN (Concerning Audit Finding 2023-001) Contact Person Responsible for Corrective Action: Lucie Tabor, Director of Finance Corrective Action: The Maine School Administrative District 27 will take the following actions to address finding 2023-001: As a Federal response to COVID-19,...

CORRECTIVE ACTION PLAN (Concerning Audit Finding 2023-001) Contact Person Responsible for Corrective Action: Lucie Tabor, Director of Finance Corrective Action: The Maine School Administrative District 27 will take the following actions to address finding 2023-001: As a Federal response to COVID-19, the Federal and State Governments provided grants to school districts to address the COVID-19 pandemic response for Schools. The CARES and ESSER Grants were initially distributed with a very short timeline on spending, initially by the end on December 2020, then subsequently extended to March 31 st and then extended beyond with additional Grants provided (ESSER I, 2 and ESSER ARP). This made for a very confusing and intense period to spend, track and coordinate spending and projects across three School Districts that the Valley Unified Education Service Center oversees. Also, the initial Grant that was provided to school Districts (CARES/ESSER I) were done so without clear directives from the Department of Education as to whether these were State Funds or Federal Funds . We were well under way with Committing and spending the funds before it was communicated that the initial funds were State funds (CARES), but subsequent ones were Federal Funds. By then, most of our projects were well under way and/or had been committed and we were now dealing with COVID-19 illnesses, remote school days, school shutdowns and delays/difficulties getting our products and contractors to pro vi de their services on the timeline we needed for the grants. These grants ran concurrently with one another and panned four Fiscal Years: 2020-21 , 2021-2022, 2022-2023 and 2023-2024. It is very rare that we have the opportunity to use Federal funds to address building or renovation projects for our school districts , so we have had no experience with the David Bacon prevailing wage requirement prior to these Federal fund , and therefore, this was not something on our radar at the time. Most of the Federal funding grants that we are used to (ESEA and Special Education) are spent on wages and purchases of materials and equipment, not projects of the scope that we were able to provide using ESSER Grant Funds. For any future projects requiring contractors, we will ensure that MSAD 27 provides the Davis Bacon requirement for prevailing wage rates including the information with the Request for Proposals or Bids (if applicable) and also with the contracts for the service once awarded. We will then ensure that the prevailing wage rates app licable to the contractor were paid to the workers (if applicable) prior to us paying the invoice to the contractor. Anticipated Compl etion Date: August 31 , 2024 to develop the policy and procedure for future Request for Propo als/ Bids that require the Davis Bacon prevailing wage rates.

View Audit 306609 Questioned Costs: $1

Finding 397858 (2023-001)

Significant Deficiency 2023

City of Weslaco

TX

Internal Control / Segregation of Duties Reporting Significant Deficiency § 200.328

The City will review the current procedures for maintaining documentation for when quarterly project and expenditures reports are completed, reviewed and submitted. Contact Person: Rosie Cavazos, CFO Proposed Implementation date: September 30, 2024

View Audit 306592

Finding 397721 (2023-002)

Significant Deficiency 2023

Breakthrough Phase Iii, Inc.

TN

HUD Housing Programs Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN Breakthrough Phase III, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from...

CORRECTIVE ACTION PLAN Breakthrough Phase III, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS — FINANCIAL STATEMENT AUDIT None FINDINGS — FEDERAL AWARD PROGRAMS AUDITS FINDING N0. 2023-002: Ineffective operation of internal controls by management Management conducted recertifications of the Project’ 5 tenants; however, cannot locate any tenant ﬁles for the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. Owners must also keep all tenant ﬁle and recertiﬁcation documentation as required by HUD. Cause of Condition: Management did not have systems in place to ensure tenant ﬁles and recertiﬁcation documentation were kept in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant ﬁles are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: Personnel at Breakthrough Corporation that are handling the operations of the Project have gone through HUD—related training and are working diligently to get the tenant files up to date and in accordance with HUD compliance.

View Audit 306573

Finding 397719 (2023-002)

Significant Deficiency 2023

Breakthrough Phase Ii, Inc.

TN

HUD Housing Programs Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN Breakthrough Phase II, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from...

CORRECTIVE ACTION PLAN Breakthrough Phase II, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS — FINANCIAL STATEMENT AUDIT None FINDINGS — FEDERAL AWARD PROGRAMS AUDITS FINDING N0. 2023-002: Ineffective operation of internal controls by management Management conducted recertifications of the Project’ 5 tenants; however, cannot locate any tenant ﬁles for the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. Owners must also keep all tenant ﬁle and recertiﬁcation documentation as required by HUD. Cause of Condition: Management did not have systems in place to ensure tenant ﬁles and recertiﬁcation documentation were kept in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant ﬁles are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: Personnel at Breakthrough Corporation that are handling the operations of the Project have gone through HUD—related training and are working diligently to get the tenant files up to date and in accordance with HUD compliance.

View Audit 306572

Finding 397717 (2023-002)

Significant Deficiency 2023

Breakthrough Phase I, Inc.

TN

HUD Housing Programs Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN Breakthrough Phase I, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from ...

CORRECTIVE ACTION PLAN Breakthrough Phase I, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. Purkey, Carter, Compton, Swann, & Carter, PLLC PO. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2022 —June 30, 2023 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS — FINANCIAL STATEMENT AUDIT None FINDINGS — FEDERAL AWARD PROGRAMS AUDITS FINDING N0. 2023-002: Ineffective operation of internal controls by management Management conducted recertifications of the Project’ 5 tenants; however, cannot locate any tenant ﬁles for the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. Owners must also keep all tenant ﬁle and recertiﬁcation documentation as required by HUD. Cause of Condition: Management did not have systems in place to ensure tenant ﬁles and recertiﬁcation documentation were kept in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant ﬁles are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: Personnel at Breakthrough Corporation that are handling the operations of the Project have gone through HUD—related training and are working diligently to get the tenant files up to date and in accordance with HUD compliance.

View Audit 306570

Finding 397692 (2023-002)

Significant Deficiency 2023

Roof Above, Inc.

NC

Subrecipient Monitoring Reporting Significant Deficiency

Corrective Action Plan Significant Deficiency - Reporting Finding 2023-002 Roof Above will develop a policy for formal documentation of review of required reports prior to submission. Contact person responsible for corrective action: Kaedon Grinnell, Chief Program Officer Anticipated completion d...

Corrective Action Plan Significant Deficiency - Reporting Finding 2023-002 Roof Above will develop a policy for formal documentation of review of required reports prior to submission. Contact person responsible for corrective action: Kaedon Grinnell, Chief Program Officer Anticipated completion date: September 30, 2024

View Audit 306553

Finding 397578 (2023-082)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Material Weakness Reporting

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it performed procedures to safeguard against unnecessary utilization of care and services for the Medicaid program. Questioned Costs: Assistance Listing # 93.775 93....

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it performed procedures to safeguard against unnecessary utilization of care and services for the Medicaid program. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Authority does not concur with the auditor’s conclusion that it needs to update the state plan to include all methods and procedures used to safeguard against unnecessary utilization of care and services. The Authority has received written guidance from the Centers for Medicare & Medicaid Services (CMS) that it does not need to individually list the methods and procedures but rather complete the template document in the state plan and select from a list of applicable methods. CMS approved this portion of the state plan effective July 1, 2023. The Authority has adequate internal controls to ensure compliance with utilization control requirements and partially concurs with the auditor’s recommendation related to implementing and monitoring a statewide surveillance and utilization control program. The Authority recently updated the Fraud and Detection System (FADS) and is in the process of updating policies and procedures related to FADS operation and the statewide surveillance and utilization control program. The FADS system triggers alerts and judgmental sampling is used by staff to assess risk and determine follow-up procedures. The system is in its early implementation phase and the Authority is still in the process of establishing written criteria. The conditions noted in this finding were previously reported in findings 2022-061, 2021-050, 2020-047, 2020-048, 2019-052, 2019-053, and 2018-047. Completion Date: Estimated December 2024 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager PO Box 45502 Olympia, WA 98504-5502 (360) 725-9586 Kari.Summerour@hca.wa.gov

View Audit 306534

Finding 397577 (2023-081)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions Internal Control / Segregation of Duties

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it periodically audited cost report data for rate setting, hospital billings, and other financial and statistical records for inpatient hospital services. Questioned Cos...

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with requirements to ensure it periodically audited cost report data for rate setting, hospital billings, and other financial and statistical records for inpatient hospital services. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Health Care Authority partially concurs with the audit finding. The Authority does not audit inpatient hospital cost reports because it is not a federal requirement. The Authority has updated the Washington Administrative Code and its State Plan to align with federal regulations. The Authority partially concurs with the auditor’s assertion that it does not audit hospital and financial and statistical records. The Authority contracts for audits of Disproportionate Share Hospitals which includes roughly half of the hospitals in Washington. These audits include other financial and statistical records and meet this requirement. The auditor was provided information regarding these audits. The Authority will develop a desk audit process to review the financial statements of Washington hospitals, as necessary, and will create policies and procedures related to this process. The Authority does not concur with the auditor’s conclusion that it does not audit hospital billings or have methodology, policies, or procedures related to these audits. The Authority conducts utilization review and payment integrity audits of inpatient hospitals on an ongoing basis, which includes verification of billed charges. This information is well-documented and was provided to the auditor during the audit. The Authority will continue to formally document its internal controls over this compliance area. The conditions noted in this finding were previously reported in findings 2022-060, 2021-051, and 2020-049. Completion Date: Estimated October 2024 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager PO Box 45502 Olympia, WA 98504-5502 (360) 725-9586 Kari.Summerour@hca.wa.gov

View Audit 306534

Finding 397576 (2023-080)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties Special Tests & Provisions

Finding: The Department of Social and Health Services’ Aging and Long-Term Support Administration did not have adequate internal controls over and did not comply with requirements to ensure timely investigation of complaints of client abuse and neglect at Medicaid residential facilities. Questio...

Finding: The Department of Social and Health Services’ Aging and Long-Term Support Administration did not have adequate internal controls over and did not comply with requirements to ensure timely investigation of complaints of client abuse and neglect at Medicaid residential facilities. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Department partially agrees with the finding. The Department agrees that it did not meet the Immediate Jeopardy and Non-Immediate Jeopardy complaint timelines due to the backlog created by the public health emergency and a 20 percent staff vacancy rate. The Department does not agree that it was due to lack of internal controls. Over the past two years, the Department had 30 new staff who were not certified to complete investigations independently; there were only three available trainers who spent the majority of their time in 2022 and early 2023 addressing training needs. Once staff completed the training and applied for certification, testing sites were limited resulting in staff having difficulty finding available testing slots. In late 2022, this process transitioned from in-person to virtual which provided greater opportunity for timelier certification. As of March 31, 2023, all staff have the required certification, and the training backlog has been resolved. As of February 2024, Immediate Jeopardy (2 days) complaints were completed on time. The Department implemented a procedure to review the status of intakes at the regional level monthly to ensure timelines continue to remain compliant for Immediate Jeopardy complaints. By June 2024, the Department will ensure Non-Immediate Jeopardy intakes are completed in a timely manner. Once the Department is in compliance with Non-Immediate Jeopardy complaints, the monthly review procedures will also be implemented. The conditions noted in this finding were previously reported in findings 2022-057 and 2021-054. Completion Date: Estimated June 2024 Agency Contact: Richard Meyer External Audit Compliance Manager PO Box 45804 Olympia, WA 98504-5804 (360) 664-6027 Richard.Meyer@dshs.wa.gov

View Audit 306534

Finding 397575 (2023-079)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties Special Tests & Provisions

Finding: The Department of Social and Health Services, Aging and Long-Term Support Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 ...

Finding: The Department of Social and Health Services, Aging and Long-Term Support Administration, did not have adequate internal controls over and did not comply with survey requirements for Medicaid nursing homes. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Department partially agrees with the finding. The Department agrees that it did not meet the Nursing Home Recertification Survey requirements, due to the backlog created by the public health emergency and a 20 percent staff vacancy rate. The Department does not agree that it was due to lack of internal controls. It was through applied internal controls that we identified the need to hire a contractor to assist with the recertification backlog to meet compliance requirements. As of March 2024, the Department met the 15.9-month recertification timeline. The 12.9-month statewide average is based on the overall average of months for all nursing home surveys, which included some of those surveys that were in a significant backlog due to the pandemic. Statistically, even when the state is meeting the 15.9-month timeframe for each home and lowering the number of months between surveys, it is expected that the bell curve average will take time to shift toward 12.9 months. The Department believes this will be achieved by January 2026. The conditions noted in this finding were previously reported in finding 2020-054. Completion Date: Estimated January 2026 Agency Contact: Richard Meyer External Audit Compliance Manager PO Box 45804 Olympia, WA 98504-5804 (360) 664-6027 Richard.Meyer@dshs.wa.gov

View Audit 306534

Finding 397572 (2023-076)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Internal Control / Segregation of Duties Subrecipient Monitoring Special Tests & Provisions

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure timely review of hospital complaints. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Status: Corrective action in progre...

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure timely review of hospital complaints. Questioned Costs: Assistance Listing # 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Status: Corrective action in progress Corrective Action: The Department has a process to screen complaints for possible imminent danger and will evaluate current procedures to identify necessary changes to ensure initial screening dates are properly reflected for subsequent assessment and review. The Department will also strengthen internal controls to ensure our licensing and regulatory systems are sufficient in managing the process of handling all facilities complaints to capture the screening for imminent danger within two working days. Once that process is complete, the Department will perform quarterly audits to confirm and document that timely screening of complaints is taking place as required. The Department will also identify strategies to improve staffing challenges and stability. Completion Date: Estimated December 2024 Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534

Finding 397499 (2023-040)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties

Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements to ensure it communicated federal award identification elements to subrecipients of the Aging Cluster Programs. Questioned Costs: Assistance Listing # 93.04...

Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements to ensure it communicated federal award identification elements to subrecipients of the Aging Cluster Programs. Questioned Costs: Assistance Listing # 93.044 93.044 COVID-19 93.045 93.045 COVID-19 93.053 Amount $0 Status: Corrective action in progress Corrective Action: The Department concurs with the finding. The Department receives Notices of Award (NOA) from the Administration of Community Living roughly three to four times per award in partial amounts. To reduce the time and effort it takes to issue subaward amendments to the 13 Area Agencies on Aging (AAA), the Department decided to post NOAs on the Department’s intranet used to communicate management bulletins and other documents to the AAAs to make the process more efficient. Unfortunately, the Department did not update subaward language to outline this change in the process. By August 2024, the Department will: • Include NOAs, with the required 14 federal identification elements, for each funding source in the initial subaward as an Exhibit D in the contracts. In addition, contract staff will ensure Exhibit D is attached to the initial subaward before the contracts are signed. • Add language to the subaward informing the AAAs that future NOAs will be posted on the Department’s intranet. Completion Date: Estimated August 2024 Agency Contact: Richard Meyer External Audit Compliance Manager PO Box 45804 Olympia, WA 98504-5804 (360) 664-6027 Richard.Meyer@dshs.wa.gov

View Audit 306534

Finding 397486 (2023-034)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Allowable Costs / Cost Principles Subrecipient Monitoring § 200.1 § 200.410

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with requirements to ensure it met the earmarking requirements for the Special Education program. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 8...

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with requirements to ensure it met the earmarking requirements for the Special Education program. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 84.173 COVID-19 Amount $378,206 Status: Corrective action complete Corrective Action: When the Special Education program underwent a fiscal leadership transition in 2021, the incoming director identified necessary changes in agency procedures for closing out fiscal year (FY) 2021. The director and budget analyst have been maintaining weekly check-ins since May 2022 to discuss the implementation of proper internal controls. Beginning in FY 2023, the Office has fully implemented processes to ensure spending plans do not exceed the maximum allowable amounts earmarked for administration and other state-level activities. The updated procedures require the director of Operations and the budget analyst to perform the following: • Review criteria for spending plans at the beginning of the fiscal year. • Review the Grant Award Notice and Grants to States Summary Table and Preschool Grants to States Summary Table. • Review spending plans and update the maximum allowable amounts earmarked for administration and other state-level activities in the spending plan throughout the fiscal year. • Meet weekly to review spending plans and update plans as requests are received. • Review monthly expenditure reports during weekly meetings. These updated procedures have contributed to increased communication and partnership between the director of Operations and the budget analyst. These internal controls provide assurance that the Office will meet earmarking requirements and compliance with federal rules. The Office will consult with the federal grantor to discuss whether the questioned costs identified in the audit should be repaid. The conditions noted in this finding were previously reported in finding 2022-025. Completion Date: March 2024 Agency Contact: Tania May Assistant Superintendent, Special Education PO Box 47200 Olympia, WA 98504-7200 (360) 725-6075 Tania.may@k12.wa.us

View Audit 306534 Questioned Costs: $1

Finding 397463 (2023-085)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties Matching / Level of Effort / Earmarking

Finding: The Health Care Authority did not have adequate internal controls over earmarking requirements for the Block Grants for Prevention and Treatment of Substance Abuse. Questioned Costs: Assistance Listing # 93.959 93.959 COVID-19 Amount $0 Status: Corrective action complete Correct...

Finding: The Health Care Authority did not have adequate internal controls over earmarking requirements for the Block Grants for Prevention and Treatment of Substance Abuse. Questioned Costs: Assistance Listing # 93.959 93.959 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: Monthly tracking workbooks are being completed and reviewed throughout the fiscal year. To address the audit recommendation, the Authority implemented formal communication for review of the monthly tracking workbooks and began maintaining documentation of the review in December 2022. The Authority is in compliance with the earmarking requirements of the program. No further procedural changes are needed. The conditions noted in this finding were previously reported in findings 2022-068 and 2021-056. Completion Date: December 2022 Agency Contact: William Sogge, CPA, CIA External Audit Liaison PO Box 45502 Olympia, WA 98504-5502 (360) 725-5110 william.sogge@hca.wa.gov

View Audit 306534

Finding 397461 (2023-083)

Significant Deficiency 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Eligibility Internal Control / Segregation of Duties

Finding: The Department of Social and Health Services did not have adequate internal controls to ensure individuals are eligible to receive benefits for the Money Follows the Person program. Questioned Costs: Assistance Listing # 93.791 Amount $0 Status: Corrective action complete Correc...

Finding: The Department of Social and Health Services did not have adequate internal controls to ensure individuals are eligible to receive benefits for the Money Follows the Person program. Questioned Costs: Assistance Listing # 93.791 Amount $0 Status: Corrective action complete Corrective Action: The Department partially agrees with the finding. The Department agrees that the Financial and Social Services Communication (14-443) forms were not provided to terminate the enrollment of the four exceptions identified in the finding. However, in those exceptions, the Roads to Community Living (RCL) disenrollment communication was made in accordance with the existing Nursing Facility Case Management policy as defined in Chapter 10 of the Long-Term Care (LTC) Manual. In addition, all clients met eligibility criteria for RCL services or were converted to another Home and Community Based program within the 365-day RCL demonstration year limitation. In these cases, the client was converted to a state plan or waiver with the new program start date noted on the 14-443 forms. The 14-443 form is a communication tool used by the Department’s public benefit specialists. For Modified Adjusted Gross Income (MAGI) enrolled Medicaid participants, benefits are managed by the Washington State Health Care Authority and the 14-443 form is not required or used by the Department’s public benefit specialists. This MAGI beneficiary communication detail was not articulated in the RCL chapter of the LTC Manual. As of May 2024, the Department updated Chapter 29 of the LTC Manual to clarify instructions related to when the 14-443 form must be completed for MAGI participants and what needs to be included on the form when it is required. Completion Date: May 2024 Agency Contact: Richard Meyer External Audit Compliance Manager PO Box 45804 Olympia, WA 98504-5804 (360) 664-6027 Richard.Meyer@dshs.wa.gov

View Audit 306534

Finding 397453 (2023-073)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Special Tests & Provisions Internal Control / Segregation of Duties

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Questioned Costs: Assistance Listing # 93.767 93.767 COVID-19 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective...

Finding: The Health Care Authority did not have adequate internal controls over and did not comply with managed care financial audit requirements. Questioned Costs: Assistance Listing # 93.767 93.767 COVID-19 93.775 93.777 93.777 COVID-19 93.778 93.778 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: Completion Date: The Authority partially concurs with the finding. Audited financial reports: The Authority agrees it allowed Managed Care Organizations (MCO) to submit annual audited financial reports in accordance with Statutory Accounting Principles to be consistent with the standards used by the Washington State Office of the Insurance Commissioner. The Authority will amend contract language to require MCOs to submit audited financial reports prepared in accordance with Generally Accepted Accounting Principles and Generally Accepted Auditing Standards, in order to comply with federal requirements. The Managed Care Oversight Audit Plan details the scheduled audits and prioritizes the various required audits. Going forward, the audit plan will list more specific information regarding the requirements and these changes will be added to the strategic plan. Periodic audits: The Authority does not concur with the auditor’s opinion that periodic audits must be “conducted and fully complete” at least once every three years. The federal regulations found in 42 CFR §438.602 specifically states: “The State must periodically, but no less frequently than once every 3 years, conduct, or contract for the conduct of, an independent audit…”. The term “complete” is not included in the federal regulations. The Authority will reach out to the Centers for Medicare & Medicaid Services to confirm its interpretation of the regulation. The conditions noted in this finding were previously reported in findings 2022-054 and 2021-048. Estimated July 2024 Agency Contact: Kari Summerour, CPA External Audit Compliance Manager PO Box 45502 Olympia, WA 98504-5502 (360) 725-9586 Kari.Summerour@hca.wa.gov

View Audit 306534

Finding 397431 (2023-069)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Reporting Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over reporting requirements for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Departm...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over reporting requirements for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Department partially concurs with the finding. The Department acknowledges that errors were made in the crosswalks and quarterly reports submitted during the audit period. To address the auditor’s specific finding, the Department has: • Reviewed and updated all electronic versions of the quarterly crosswalks for accuracy. • Submitted corrections for the federal fiscal year 2023 Quarter 3 report. The conditions noted in this finding were previously reported in finding 2022-051. Completion Date: February 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534

Finding 397430 (2023-068)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Eligibility Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure group care facility employees and adults residing in prospective caregivers’ households had cleared background checks before having unsupervised access to children. Questioned Costs: Assist...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure group care facility employees and adults residing in prospective caregivers’ households had cleared background checks before having unsupervised access to children. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Department partially concurs with the finding. The auditors identified two exceptions where fingerprint checks for two family foster home adults were completed two days later than the required timeline of 15 calendar days. The delay was due to the misspelling of one applicant’s last name in the system. Upon correction, the applicants subsequently completed the fingerprint checks and were determined eligible. As stated in the finding’s Cause of Condition, the Department developed a corrective action plan to address the internal control deficiencies in response to the prior year’s finding which had not been fully implemented within the current audit period. The Department is confident that all staff who work with children and youth have cleared background checks. As of April 1, 2023, the Department implemented a new process for processing background checks for group care facilities to strengthen internal controls, documentation, and clarification on the “effective date.” The updated process is outlined below: • A new form was created with clear instructions for the group care facilities to provide the applicant/employee information, including the background check confirmation code, directly to the Department’s Background Check Unit (BCU). • The BCU works with the applicant/employee through the fingerprint background check process. • The results are sent directly to the BCU, at which time they complete a child abuse/neglect history check and if needed a suitability assessment. The BCU documents the results in FamLink with the date the background check is completed. • The BCU emails the results to the group care facility and the Department’s Licensing Division (LD) group. If the applicant/employee is cleared and is not a renewal, LD staff adds the applicant/employee to the group care facility in FamLink with the clearance information attached. The conditions noted in this finding were previously reported in finding 2022-050. Completion Date: April 2023 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534

Finding 397429 (2023-067)

Significant Deficiency 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure monthly foster care maintenance payments to children’s caregivers were adequate and accurate for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amoun...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure monthly foster care maintenance payments to children’s caregivers were adequate and accurate for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Department is committed to strengthening internal controls and complying with grant requirements. As stated in the finding’s Cause of Condition, the Department utilizes FamLink as the case management system for the Foster Care program which, due to system limitations, did not have the reporting capabilities to track rate setting reviews during the audit period. To assist with tracking rate setting requirements, the Department: • Created a new report in FamLink to assist rate assessors in identifying six-month reviews that have not been performed timely. • Implemented monthly tracking by supervisors to assist with internal controls and compliance. In response to the auditor’s recommendations and to assist in compliance, the Department has submitted a request to the technical team for an update to the report to also show when the next rate assessment is due. Completion Date: Estimated June 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534

Finding 397428 (2023-066)

Significant Deficiency 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to providers for travel and family visits were allowable and adequately supported for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amo...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure payments to providers for travel and family visits were allowable and adequately supported for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Department is committed to strengthening internal controls and complying with grant requirements. As stated in the finding’s Cause of Condition, the Department was unable to fully implement the prior corrective action plan during the audit period. In April 2023, the Fiscal Integrity Unit collaborated with other divisions to implement the following internal controls: • Utilized algorithms in the Sprout system to identify reimbursement requests outside of a reasonable amount. • Required providers to submit additional documentation or explanation for those identified amounts. • Implemented a re-run process for prior billing periods to eliminate potential double billings by providers. • Trained headquarters and field office accounting staff to utilize the new algorithms and review additional documentation prior to processing payments. • Required program staff review and approval of all vendor invoices prior to release of payment for the Eastern Washington regions. In January 2024, the Fiscal Integrity Unit identified and implemented regional program approvals for Western Washington providers. The Contracts office has also taken the following actions: • In August 2023, filled one vacant staff position dedicated to reviewing child welfare contracts to include family time visit payments. • In November 2023, developed compliance audit plans for child welfare contracts and began fiscal monitoring of family time visit payments. • In December 2023, filled an additional vacant staff position dedicated to reviewing child welfare contracts. The conditions noted in this finding were previously reported in findings 2022-048 and 2021-040. Completion Date: January 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534

Finding 397427 (2023-065)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Allowable Costs / Cost Principles Subrecipient Monitoring Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate controls over and did not comply with certain requirements of its Public Assistance Cost Allocation Plan. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Status: Corrective action complete Correct...

Finding: The Department of Children, Youth, and Families did not have adequate controls over and did not comply with certain requirements of its Public Assistance Cost Allocation Plan. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Status: Corrective action complete Corrective Action: The Department concurs with the finding and is committed to improving internal controls. The Department did not have adequate staffing levels to maintain the business processes for one monthly workbook for the Public Assistance Cost Allocation Plan. The Department was not able to complete the September 2022 workbook for cost base 100 (administrative charges) due to competing state and federal fiscal year close deadlines. Available staff were focused on grant reconciliations and closing out the prior fiscal year financial transactions. The Department has reviewed the base edit form written procedures with staff and added monthly reminders for the Cost Allocation and Grants Management Unit. In addition, the Department has confirmed that all cost base 100 workbooks have been properly completed for the state fiscal year 2024. The conditions noted in this finding were previously reported in finding 2022-047. Completion Date: March 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534

Finding 397406 (2023-049)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure subrecipients of the Epidemiology and Laboratory Capacity for Infectious Diseases program received required single audits, and that it appropriately followed up on findings ...

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure subrecipients of the Epidemiology and Laboratory Capacity for Infectious Diseases program received required single audits, and that it appropriately followed up on findings and issued management decisions. Questioned Costs: Assistance Listing # 93.323 93.323 COVID-19 Amount $0 Status: Corrective action in progress Corrective Action: The Department will review internal controls to ensure: • Timely review of federal subrecipient single audits. • Management decision letters are issued to subrecipients. • Subrecipients take timely and appropriate action on all deficiencies pertaining to the federal award. Management will monitor the control activities to ensure future compliance with the requirements. Completion Date: Estimated December 2024 Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534

Finding 397405 (2023-048)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Equipment & Real Property Management Internal Control / Segregation of Duties

Finding: The Department of Health did not have adequate internal controls over and did not comply with reporting requirements for the Epidemiology and Laboratory Capacity for Infectious Diseases program. Questioned Costs: Assistance Listing # 93.323 93.323 COVID-19 Amount $0 Status: Correc...

Finding: The Department of Health did not have adequate internal controls over and did not comply with reporting requirements for the Epidemiology and Laboratory Capacity for Infectious Diseases program. Questioned Costs: Assistance Listing # 93.323 93.323 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: In response to the fiscal year 2022 audit recommendations, the Department implemented procedures to ensure management review and approval of the fiscal report, Case Investigation and Contact Tracing (CICT) report, and the Reopening Schools testing report are documented and retained before submission to the federal grantor. At the beginning of fiscal year 2023, the auditors were still conducting field work for the prior year’s audit. Procedures were not in place at that time when reports were submitted to the Case Risk and Exposure Surveillance Tool and RedCap systems. As a result, corrective actions were not fully implemented during the current audit year. The CICT reporting was discontinued as of August 2023, and the Reopening Schools project ended after July 31, 2023. The conditions noted in this finding were previously reported in finding 2022-034. Completion Date: January 2023 Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534

Finding 397398 (2023-045)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Internal Control / Segregation of Duties

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure it filed accurate and timely reports required by the Federal Funding Accountability and Transparency Act for the Immunization Cooperative Agreements program. Questioned C...

Finding: The Department of Health did not have adequate internal controls over and did not comply with requirements to ensure it filed accurate and timely reports required by the Federal Funding Accountability and Transparency Act for the Immunization Cooperative Agreements program. Questioned Costs: Assistance Listing # 93.268 93.268 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Department agrees with the finding. In response to the prior year’s finding, the Department implemented procedures to ensure Federal Funding Accountability and Transparency Act (FFATA) reports are submitted timely, and management performs and documents review of the reports before submission in the FFATA Subaward Reporting System (FSRS). These include using the signature date of the subaward documents as the obligation date to ensure timely submission of the FFATA reports. Due to the timing of the audit, the above procedures were not in place during all of state fiscal year 2023, which resulted in some of the exceptions noted by the auditors. As stated in the finding’s Cause of Condition, the subaward amendments were submitted late because the transition of the Data Universal Numbering System number to Unique Entity Identifier had caused significant delays for sub-awardees to provide the updated identifier information for reporting in FSRS. The conditions noted in this finding were previously reported in finding 2022-032. Completion Date: October 2022 Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534

Finding 397352 (2023-038)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with federal reporting requirements for the Education Stabilization Fund program. Questioned Costs: Assistance Listing # 84.425D 84.425R 84.425U 84.425V 84.425W Amount $0 ...

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with federal reporting requirements for the Education Stabilization Fund program. Questioned Costs: Assistance Listing # 84.425D 84.425R 84.425U 84.425V 84.425W Amount $0 Status: Corrective action in progress Corrective Action: Certain data elements missing on the annual Elementary and Secondary School Emergency Relief (ESSER) performance report was not due to lack of internal controls, but rather a result of: • Late publication of the federal reporting template which did not allow timely collection of cost details from school districts. • Non-alignment of reporting time frame with school district fiscal year and the decision against assumptions of state level expenditure for reporting. To address the audit recommendations, the Office is organizing a series of webinars and trainings for school districts, so they are prepared to annually submit required key information directly to the Office for ESSER reporting. Through these training events, the Office’s fiscal team can answer questions and assist districts to ensure timely and accurate reporting and comply with federal requirements. The Office has been having ongoing conversations with the U.S. Department of Education regarding federal reporting on the ESSER funds. At this time, there is no indication that the grantor will request the information to be resubmitted. Completion Date: Estimated June 2024 Agency Contact: TJ Kelly Chief Financial Officer PO Box 47200 Olympia, WA 98504-7200 (360) 725-6301 Thomas.Kelly@k12.wa.us

View Audit 306534

Corrective Action Plans

Filters