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Finding 515367 (2023-104)
Significant Deficiency 2023
Assistance listing number and program name: 84.425C COVID-19 - Education Stabilization Fund –Governor’s Emergency Education Relief (GEER) Fund Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of contact person and title: Sarah Brown, Director Anticipated completion...
Assistance listing number and program name: 84.425C COVID-19 - Education Stabilization Fund –Governor’s Emergency Education Relief (GEER) Fund Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of contact person and title: Sarah Brown, Director Anticipated completion date: May 1, 2025 Agency’s response: Concur Corrective Action Plan: The Office agrees with this finding and will begin to take corrective action to bring the program fully into compliance with FFATA reporting requirements under federal and state guidelines. The Office previously reported staff turnover for key personnel directly responsible for preparing, submitting, and reviewing FFATA reporting (i.e., 100 percent turnover). After reviewing supporting documentation and consulting with the U.S. Department of Education, the Office has determined that staff misinterpreted the reporting guidance. The Office understood the reporting did not require submissions on subawards made by another state agency. The Office did report the awards made to that respective state agency but did not include the agency subawards. The Office is working with the state agency to collect subaward data required for accurate reporting. During fiscal year 2025, the Office took significant corrective action to improve FFATA reporting. This corrective action plan includes the following: • FFATA Reporting Reconciliation—The Office will review, correct, and/or resubmit any inaccurately reported information, including subawards. • Annual Performance Reporting (APR) Reconciliation—The Office is unable to amend and resubmit the fiscal year 2022 APR per guidance from the U.S. Department of Education - Education Stabilization Fund Reporting Helpdesk. The reporting portal is unable to accept any revisions for fiscal year 2022. The Office will review any current reporting and ensure subaward data is included. • Update Written Procedures—The Office will update its written procedures to incorporate a process for reviewing federal guidance on a schedule aligned with federal reporting windows as applicable. • Ongoing Training—Office staff now attend ongoing internal and external training to improve their understanding of compliance requirements, identify noncompliance, and actively reduce the risks of reporting errors. As of this date, the Office has allocated sufficient resources to comply with the award terms and program requirements by establishing a Grants Compliance and Reporting Team dedicated to performing necessary FFATA reporting procedures. The Office is committed to ongoing staff training, improved internal reporting processes, and ensuring the State’s stakeholders and the public have access to transparent and timely information about all federal award spending decisions on the USAspending.gov website as federal laws and regulations require.
Assistance listing number and program name: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) 84.425D COVID-19 - Education Stabilization Fund-Elementary and Secondary School Emergency Relief (ESS...
Assistance listing number and program name: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) 84.425D COVID-19 - Education Stabilization Fund-Elementary and Secondary School Emergency Relief (ESSER) Fund 84.425U COVID-19 - Education Stabilization Fund - American Rescue Plan - Elementary and Secondary Schools Emergency Relief (ARP ESSER) Fund Agency: Arizona Department of Education (ADE) Name of contact persons and titles: Nicole Von Prisk, ADE Deputy Associate Superintendent of Grants Management Matt McClary, ADE Compliance Officer Anticipated completion date: October 30, 2024 Agency’s response: Concur Arizona Department of Education has worked in cooperation with our vendor to correct outdated SQL queries that were identified and returning only approved grant award amounts rather than all awarded amounts, regardless of approval status. We will ensure that the original award amounts are being queried and, in return, reported within the FFATA Subaward Reporting System (FSRS). Additionally, through the reconciliation process each month, correct award amounts will align with corresponding Federal Award Identification Number (FAIN). We have implemented an automated monthly reporting workflow/schedule which will help ensure required FFATA reporting is submitted timely. This process automation helps prompt monthly FFATA reporting uploads by leveraging office tools that are readily available and ensures monthly upload deadlines are met by automatically scheduling the task and requiring follow-up by the assignee. In January of 2024 the staff assigned to FFATA uploads changed again (for the fourth time in a year) and at that point a new staff member assumed responsibility for FFATA uploads. As numerous corrections needed were discovered through the reconciliation process, new reports were uploaded. Some of these were original uploads for entities that were missing FSRS information altogether and some were corrections to previously uploaded yet incorrect information. With each monthly upload, a new date was being captured and while some of the information was new entity award information, not all of the information being updated was untimely. This has been a long and arduous process, and we look forward to not having continued FFATA findings, as we are making progress to correcting award information for all federal grants moving forward from this point. Our Compliance Officer reconciles the current FSRS award information monthly with our Lead Grants Coordinator or our Deputy Associate Superintendent. Any missing or duplicate information is corrected prior to the FSRS upload.
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Dr. Sarka White, AD...
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Dr. Sarka White, ADE Deputy Associate Superintendent Anticipated completion date: December 15, 2024 Agency’s response: Concur The Arizona Department of Education (ADE) has already begun implementing a program to ensure accurate and quality programmatic monitoring for all ESEA programs which specifically requires LEAs to meet 100% of the requirements of all statutorily required items to be monitored regardless of CMO affiliation. This development of programmatic monitoring will design a system of integrity to allow each LEA to have unique monitoring findings and ensure they are treated as all other LEAs regardless of management status. The Arizona Department of Education (ADE) is finalizing all program policies and procedures along with field training and staff training on how this program is implemented. ADE began providing an assurance document to charters in May 2024 which asks the charters to assure that if they do business with a CMO, the CMO does not have fiscal or operational authority for the LEA. The charter is asked to submit to ADE a copy of their organizational chart, along with the assurances document. Grants Management has created a new user role in the Grants Management Enterprise (GME) system, called the LEA Contracted Update role. This role allows a CMO person the access to perform fiscal tasks for which they have been contracted but does not hold the final submit or approve capacity, that must be reserved for authorized employees of the LEA. Grants Management has provided the placeholder for the assurance and organizational chart in the LEA Document Library, along with the communication to eligible entities (charters in this case). Individual program areas within ADE who review and approve funding applications will be responsible for verifying the assurances have been signed and uploaded and only authorized people at the LEA are actioning funding applications in GME prior to the program area giving director approval to the application.
View Audit 333243 Questioned Costs: $1
Assistance listing number and program name: 84.010 Title I Grants to Local Educational Agencies Agency: Arizona Department of Education (ADE) Name of contact person and title: Tim McCain, ADE Chief Financial Officer Chris Brown, ADE Business Officer of Education Programs Anticipated completion date:...
Assistance listing number and program name: 84.010 Title I Grants to Local Educational Agencies Agency: Arizona Department of Education (ADE) Name of contact person and title: Tim McCain, ADE Chief Financial Officer Chris Brown, ADE Business Officer of Education Programs Anticipated completion date: January 2025 Agency’s response: Concur • ADE is working on standardizing fiscal efficiency by adopting uniform guidelines that monitor obligations and expenditures. These guidelines outline available resources and determine allocation amounts within federal awards and earmark expiration dates within programs. • ADE is also working on standardizing how funds may be reallocated to ensure that no funds are at risk of reverting to USED. Specifically, school improvement funds are now also tracked as part of Title I allocation and reallocation process. This will ensure funds are earmarked and obligated in a timely fashion (i.e., in the period of performance). This item is planned to be completed by January 2025.
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Nicole Von Prisk, A...
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Nicole Von Prisk, ADE Deputy Associate Superintendent of Grants Management Matt McClary, ADE Compliance Officer Anticipated completion date: April 2025 Agency’s response: Concur • Tech team supervisor will have someone from that team put eyes on the initial generated report to compare results to prior year, looking at total number of LEAs, then greenlighting the initial report for the Tech Director and the Fiscal Director to review. • Once the Fiscal and Tech Directors receive the report, they will be responsible for sampling the data that populated into the report, by looking at overall numbers who Pass, Pass with Exception, or Fail and doing a comparison for analysis to prior year summary results. They will conduct a random sampling, comparing totals to latest AFR totals, to ensure amounts populated correctly. Once random sampling has been completed, it will be sent to Deputy Associate Superintendent for final checks. • Deputy Associate Superintendent will give final approval to move to public display of data, after confirmation of completeness and accuracy of data populated.
View Audit 333243 Questioned Costs: $1
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Dr. Sarka White, AD...
Assistance listing numbers and program names: 84.010 Title I Grants to Local Educational Agencies 84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) Agency: Arizona Department of Education (ADE) Name of contact person and title: Dr. Sarka White, ADE Deputy Associate Superintendent Chris Brown, Business Officer of Education Programs Anticipated completion date: February 2025 Agency’s response: Concur • The Arizona Department of Education (ADE) has already begun to document and execute practices addressing the recommendations issued by the auditor's office. • ADE has already drafted a comprehensive policies and procedures document outlining eligibility, duties, and responsibilities with individuals who oversee and double-check the work. This document was created and refined by reviewing other states’ procedures, federal technical assistance groups, communications with the Title federal program office at the United States Department of Education, and internal procedures in other units. • The Title I unit has been restructured to have an operations team with multiple staff members overseeing data quality and internal controls for allocations. This updated structure ensures that multiple individuals are involved in the allocation process. Staffing for this should be completed by February 2025. • The updated processes include entity management to determine when charter LEAs open and operate each year. Now, other systems validate this information instead of copying the information from the prior year. As such, this item has already been completed. • Finally, the department will follow up with the United States Department of Education (USED) regarding recalculating the fiscal year 2023 and the six ineligible LEAs for Title II funds to determine feasible processes and resolutions to each audit recommendation.
View Audit 333243 Questioned Costs: $1
Assistance listing number and program name: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Jim Whallon, DES Deputy CFO Anticipated completion date: June 30, 2026 Agency’s response: Concur Th...
Assistance listing number and program name: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Jim Whallon, DES Deputy CFO Anticipated completion date: June 30, 2026 Agency’s response: Concur The Department of Economic Security will address the audit recommendations as follows: 1. Perform required monitoring of its subrecipients and their compliance with the award terms and program requirements. The Department will revise its agency-wide policies and procedures related to single audit requirements for pass-through entities to include guidance regarding how to establish effective subrecipient monitoring procedures. The Department will also offer additional subrecipient monitoring guidance for programs administered by divisions with existing subrecipient monitoring findings. 2. Properly classify and report subrecipient expenditures on the State’s SEFA. The Department will revise its procedures related to single audit requirements to include steps detailing the instructions for classifying and reporting subrecipient expenditures on the State’s SEFA. The updated procedures will include actions needed to be taken to ensure each pass-through relationship is appropriately determined and that every subrecipient relationship is communicated to the staff responsible for compiling the State’s SEFA. 3. Develop, implement, and train all divisions on entity-wide written subrecipient-monitoring policies and procedures requiring all divisions to: a. Assess the risk of each subrecipient’s noncompliance and carry out monitoring activities based on those risk assessments such as reviewing financial and performance reports, providing training or technical assistance on program-related matters, and performing on-site reviews, selective audits, and/or other monitoring procedures. b. Verify subrecipients receive timely single audits, if required; follow up on and ensure that corrective action is taken on any audit findings that could potentially affect the program; and issue management decisions for any audit findings pertaining to the federal award. c. Maintain documentation of monitoring procedures demonstrating they were performed, including the monitoring procedures’ results and any Department actions taken, if appropriate. In addition to the revisions in policy and procedures outlined in Recommendation #1 above, the Department will train staff responsible for administering compliance requirements for pass-through entities. This training will include instructions to formulate a risk assessment, review controls related to compliance requirements, review timely single audit submittal, follow up on audit findings, issue management decisions for findings, and maintain adequate documentation of monitoring procedures. The training will be provided to all staff responsible for administering programs with pass-through entities. 4. Allocate sufficient resources, such as staffing, to comply with the award terms and program requirements, and designate individuals within each division to perform necessary subrecipient-monitoring procedures. The Department will conduct analyses to determine resources needed, including staffing, to ensure compliance with applicable requirements. For example, the Department will assess the efficiency of its subrecipient-monitoring procedures, estimate future workloads, determine staffing needed to meet those workloads, and assign sufficient staff the responsibility for ensuring compliance with each requirement outlined in the federal award. The Department will also ensure the staff responsible for administering the compliance requirements prioritize this responsibility and communicate anticipated compliance deficiencies to management. 5. Update the form it uses to determine whether other parties receiving program monies have the role of a subrecipient or contractor to include guidance for how to determine each characteristic of a subrecipient and contractor relationship and require a conclusion to be documented. In addition, train staff to properly complete the form and perform supervisory reviews of it. The Department will revise its Contractor/Subrecipient Determination form to clearly identify the final determination of a pass-through entity. The Department will also provide guidance to accompany the form that shows how to determine each characteristic of a subrecipient and contractor as well as how to make the final determination regarding the contractor versus subrecipient relationship. The Department will then provide training to staff responsible for using this form as part of the training outlined in Recommendation #3 above.
View Audit 333243 Questioned Costs: $1
Assistance listing number and program name: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of contact person and title: Sarah Brown, Director Anticipated completion date: February 28, 2025 Agency...
Assistance listing number and program name: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of contact person and title: Sarah Brown, Director Anticipated completion date: February 28, 2025 Agency’s response: Concur The Office agrees with this finding and will begin to take corrective action to bring the program fully into compliance with SLFRF Federal grant reporting requirements. The Office recognizes the importance of transparency in utilizing Federal grants and has taken significant corrective action to resolve any inaccuracies in Federal grant reporting. The Office has implemented specific actions to ensure reporting inaccuracies and program expenditure understatements/overstatements do not occur. During fiscal year 2025, the Office is taking corrective action to improve SLFRF reporting, including the following: • Award Reconciliation—The Office has conducted a comprehensive review and extensive reconciliation of all awards to identify reporting inaccuracies. • Expenditure Reconciliation—The Office staff responsible for preparing the SLFRF quarterly reports is completing the reconciliation of all expenditures to the State’s accounting records, which are the official expenditures made for the program. • Enhanced Reporting Mechanisms—The Office will review, correct, and/or resubmit any inaccurately reported information. The staff responsible for preparing the SLFRF quarterly reports is no longer reconciling to the Office’s internal grants-management system. • Update Written Procedures—Based on the comprehensive review noted in the response above, the Office is working to develop improved reporting procedures to ensure accurate submission of grant expenditure data. This may include revised standardized templates, improved guidelines, and enhanced communication channels to improve reporting accuracy. • Ongoing Training—Office staff now attend ongoing internal and external training to improve their understanding of compliance requirements, identify noncompliance, and actively reduce the risks of reporting errors. The Office will continue to strengthen internal controls to prevent similar issues from occurring in the future. This will involve strengthening oversight, providing additional training to staff members in reporting processes, and implementing regular quality assurance checks. As of this date, the Office has allocated sufficient resources to comply with the award terms and program reporting requirements by establishing a new Grants Technology and Data team dedicated to the oversight of performing necessary SLFRF program reporting procedures.
Assistance listing numbers and program names: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds 84.425C COVID-19 Education Stabilization Fund –Governor’s Emergency Education Relief (GEER) Fund Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of c...
Assistance listing numbers and program names: 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds 84.425C COVID-19 Education Stabilization Fund –Governor’s Emergency Education Relief (GEER) Fund Agency: Arizona Governor’s Office of Strategic Planning and Budgeting (Office) Name of contact person and title: Sarah Brown, Director Anticipated completion date: July 31, 2025 Agency’s response: Concur During fiscal year 2024, the Office took significant corrective action to improve subrecipient monitoring by developing and implementing a comprehensive subrecipient monitoring plan. This plan includes the following: • Financial Report-Reimbursement Requests—The Office reviews the grantee's financial reports to ensure costs align with the approved budget, program objectives, and federal cost principles. • Performance Reports—The Office reviews the submission of programmatic reports. The timelines for submission and frequency of the programmatic activity reports are defined in the terms and conditions of each award. The program activity reports document that all program requirements are being satisfactorily fulfilled. Grantee outreach is conducted when performance activity is lagging. Grantee check-ins and/or additional milestones are set to ensure goals are met. The Office may amend or terminate the grant award if sufficient progress is lacking. • Single Audit Reports—The Office confirms any required Single Audits and reviews a copy of the most recent report. • A Single Audit Questionnaire is distributed to grantees annually to confirm if the entity is subject to this federal audit requirement. • The Office also reviews total payments issued to an entity by the Office in the prior year to confirm if disbursements met the audit threshold. • The Office requests grantees submit their Single Audit Reporting Package (SARP) with any findings and the required Corrective Action Plan. In addition, the Office collects SARPs from the federal clearinghouse. • The Office reviews SARPs for any findings and conducts follow-up monitoring of CAPs that impact any grant funding managed by the Office. Management decisions are issued to grantees as required for specific grant findings. • Risk Assessment (RA)—The Office conducts a Risk Assessment (RA) of grantees when applying for grants to inform the grant award decision and possible grantee oversight or restrictions. Additionally, the Office conducts an annual RA of any grantee currently awarded funding. • The RA contains a self-assessment for the grantee to complete and an internal review conducted by the Office. Scores from both are weighted and used to calculate the overall risk score for each grantee as high, medium, and low risk. • The Office utilizes the RA results to prioritize high-risk grantees, which are reviewed through a desk or on-site monitoring. Medium-risk grantees will receive additional support and be referred to our Compliance and Reporting team for further review if additional concerns arise. Office staff now attend ongoing internal and external training to improve their understanding of compliance requirements, identify noncompliance, and actively reduce the risks of waste, fraud, and abuse of federal dollars through our subrecipient monitoring process. The Office has developed and implemented processes for requirements such as single audit review and corrective action follow-up, risk assessment, and subrecipient monitoring to address the specific findings. During the time frame corresponding to this audit finding, the pace and volume of grants management administrative duties required to be executed exceeded staffing capacity, contributing to the findings noted. As of this date, the Office has achieved stability in both manager and staff positions. In addition, the Office has allocated sufficient resources to comply with the award terms and program requirements by establishing a Grants Compliance and Reporting Team dedicated to performing necessary subrecipient monitoring procedures. Furthermore, the Office has implemented all recommendations and would like to specifically highlight efforts to work with subrecipients to resolve the potential disallowed costs of $1,903,858 of program monies that may have been spent in violation of its federal award terms by conducting on-site monitoring visits, desk reviews, and facilitating subrecipient technical assistance. OSPB is committed to continuing these efforts.
View Audit 333243 Questioned Costs: $1
Finding 515214 (2023-108)
Significant Deficiency 2023
Assistance listing number and program name: 21.023 COVID-19 - Emergency Rental Assistance Program Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Leanna DeKing, DES Policy Planning Project Manager Anticipated completion date: June 30, 2025 Agency’s Response: ...
Assistance listing number and program name: 21.023 COVID-19 - Emergency Rental Assistance Program Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Leanna DeKing, DES Policy Planning Project Manager Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: The Department will ensure program costs are properly recorded in the financial system during the period of performance and only obligated costs are spent during the liquidation period. Closeout activities, such as direct administrative costs, will be obligated prior to the end of the award period and spent within the liquidation period, or 120 calendar days after the period of performance ends. The Department will allocate sufficient resources to perform essential grant closeout functions to help prevent inappropriate charges. The Department will also update existing grant closeout procedures to require a review and approval of grant expenditures during the liquidation period to ensure they are allowable and properly obligated prior to the period of performance end date.
Assistance listing number and program name: 21.023 COVID-19 - Emergency Rental Assistance Program Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Molly Bright, DES CCSD Assistant Director Anticipated completion date: June 30, 2025 Agency’s response: Concur The...
Assistance listing number and program name: 21.023 COVID-19 - Emergency Rental Assistance Program Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Molly Bright, DES CCSD Assistant Director Anticipated completion date: June 30, 2025 Agency’s response: Concur The Department of Economic Security will address the audit recommendations as follows: The Department will prepare and retain detailed documentation including system reports, queries, screenshots, and other evidence supporting the program information being reported to the federal agency for each Emergency Rental Assistance Program (ERAP) award. DES will also abide by its policies and procedures to retain all records relating to federal awards for a period of 5 years after all the federal funds are expended. For future related programs with this requirement, the Department will develop and implement internal control policies and procedures that ensure systems properly display complete and accurate data on the federal reporting dashboard as instructed by the federal agency’s reporting guidelines. Additionally, these policies and provisions will ensure that any future ERAP award funding received by the Department will be separately reported to avoid commingling. Finally, the Department will require that ERAP personnel verify the reported program information to ensure all report element sections are complete and accurate, and that it matches the underlying benefits and financial systems data. The Department sunset the ERAP program on October 13th, 2023, due to an exhaustion of ERA 1 and ERA 2 funding.
Assistance listing numbers and program names: 21.023 COVID-19 - Emergency Rental Assistance Program 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Molly Bright, DES CCSD Assistant Director An...
Assistance listing numbers and program names: 21.023 COVID-19 - Emergency Rental Assistance Program 21.027 COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Molly Bright, DES CCSD Assistant Director Anticipated completion date: June 30, 2026 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: 1. Ensure benefit payments are for allowable costs paid to or on behalf of eligible program applicants. The Department will review and confirm that benefits payments paid to or on the behalf of eligible program applicants are allowable expenditures of the federal funding being disbursed. 2. Follow existing policies and procedures to obtain required documentation to support requirements related to where the applicant lives and their income to ensure program applicants are eligible to receive benefit payments. The Department will abide by the existing adjudication policies and procedures that require the submission of substantiating documentation supporting the claims made by applicants regarding where they live and their household income to confirm that applicants are eligible to receive benefit payments under the program and to verify the amount of benefits they shall receive. 3. Allocate sufficient staffing resources to perform a thorough evaluation of program benefits applications and provide training on eligibility requirements and allowable benefit payments. The Department will attempt to obtain or allocate additional resources to staffing to support the program benefits application evaluation process and will provide additional training to staff on eligibility requirements and allowable benefit payment regulations. 4. Update the checklist Division personnel use to perform a post-review of eligibility determinations to include detailed guidance for verifying the determinations aligned with the Division’s written policies and procedures and supported by adequate documentation. The Department will update the checklist being used by staff to perform post-review of eligibility determinations to include detailed guidance on verifying the applicant benefits determinations in alignment with the divisional policies and procedures and evidenced by adequate substantiating documentation.
View Audit 333243 Questioned Costs: $1
Finding 515207 (2023-110)
Significant Deficiency 2023
Assistance listing number and program name: 17.225 Unemployment Insurance Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Tracy Raymer, DES Business Analyst Manager Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department of Economi...
Assistance listing number and program name: 17.225 Unemployment Insurance Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Tracy Raymer, DES Business Analyst Manager Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: Develop and implement written policies and procedures to ensure it prepares and retains detailed documentation, such as system reports, queries, or screenshots, to support the program information it reports to the federal agency for the UI program for a period of at least three (3) years. Beginning July 2024, the Department has assembled and retained all detailed supporting source documentation that supports the data provided in the 9050 - Time Lapse of All First Payments except Workshare report and will retain it for a period of no less than three (3) years.
Finding 515206 (2023-109)
Significant Deficiency 2023
Assistance listing number and program name: 17.225 Unemployment Insurance Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Jacqueline Butera, DES Administrator Jean Ahumada, DES BAM Manager Anticipated completion date: March 18, 2024 Agency’s Response: Concu...
Assistance listing number and program name: 17.225 Unemployment Insurance Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Jacqueline Butera, DES Administrator Jean Ahumada, DES BAM Manager Anticipated completion date: March 18, 2024 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: The controls the Department put in place to address the federal regulation requirements, are multi-year remediation plans. The controls include recruiting and retaining a workforce with a strong knowledge and understanding of Unemployment Insurance Laws, Policies, and Procedures, as well as proper case management skills. From December 2022 through March 2024, the Benefit Accuracy and Measurement (BAM) unit experienced an 18 percent attrition rate. Given the fact that the BAM unit is made up of nine (9) auditors, one of which is a lead who does not receive a full caseload, an 18 percent attrition rate results in a significant impact on the distribution of workloads amongst experienced and new staff, respectively. As of December 2023, the BAM unit was 90 percent staffed with only 67 percent of auditors working a full caseload. This is because new hires with prior program knowledge do not receive a full caseload until three (3) months from their new hire date. During SFY 2023, the Department carefully balanced meaningful recruitments, staff training, and case assignments in order to support staff retention while addressing the federal timeliness requirements. As of March 18, 2024, the Department fully implemented the multi-year remediation plan, and has shown sustainable performance improvement in both the paid and denied claims accuracy measures since September 2023, due to these controls. As of SFY 2024, the Department has met all Paid Case Accuracy and Denied Case Accuracy timeliness performance measures.
Finding 515177 (2023-114)
Significant Deficiency 2023
Assistance listing numbers and program names: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Worker Formula Grants Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Aaron Johnson, DES Fiscal Compliance Manager Jacy Wilmes, DES D...
Assistance listing numbers and program names: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Worker Formula Grants Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Aaron Johnson, DES Fiscal Compliance Manager Jacy Wilmes, DES Deputy Business Administrator Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department of Economic Security will address the audit recommendations as follows: The Department will immediately report the required missing information for its subawards on the FFATA Subaward Reporting System for the WIOA cluster. The Department will also follow the State’s accounting manual for reporting subaward actions equaling or exceeding $30,000 no later than the month-end of the month following the sub-award action. In addition, the Department will implement procedures requiring independent reviews to ensure the sub-award data is reviewed for accuracy prior to and after uploading to the federal government’s reporting system.
Finding 515176 (2023-113)
Significant Deficiency 2023
Assistance listing numbers and program names: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Worker Formula Grants Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Aaron Johnson, DES Fiscal Compliance Manager Tarry Haynie, DES ...
Assistance listing numbers and program names: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Worker Formula Grants Agency: Arizona Department of Economic Security (DES) Name of contact persons and titles: Aaron Johnson, DES Fiscal Compliance Manager Tarry Haynie, DES Senior Fiscal Analyst Anticipated completion date: June 30, 2025 Agency’s Response: Concur To ensure the Department’s Division of Employment and Rehabilitation Services (DERS) Finance and Business Operations Administration (FBOA) performs the required monitoring of its sub-recipients and complies with the award terms and program requirements, it has added additional internal controls by updating the monitoring schedule to include backup fiscal monitors. The FBOA will also update its procedures to include the process for backup monitors to take on primary monitoring duties in the event an assigned staff member is unable to perform the onsite monitoring review as scheduled. During fiscal year 2023, the fiscal compliance team within the FBOA consisted of only three staff members. They have since onboarded two additional staff, bringing the total number of fiscal compliance monitors to five. One of these additional staff members completed training and was assigned a full caseload in December 2023. The second new staff member is currently undergoing training and is expected to finish training and absorb a full caseload beginning March 2025. The Department is on track to complete all required onsite sub-recipient fiscal monitoring for fiscal year 2025.
View Audit 333243 Questioned Costs: $1
Finding 515171 (2023-119)
Significant Deficiency 2023
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Departme...
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Department is in the process of developing written policies and procedures to address matching, level of effort, and earmarking. The policies and procedures will address communication with subrecipients and maintaining records and documentation of the amounts used to fulfill matching requirements.
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Lori Moreno, DOH Human Resources and Procurement Administrator Anticipated completion date: March 31, 2025 Agency’s Response: Concur The Depart...
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Lori Moreno, DOH Human Resources and Procurement Administrator Anticipated completion date: March 31, 2025 Agency’s Response: Concur The Department will update written policies and procedures related to procurement to incorporate applicable aspects of Federal Regulations 2 CFR §§200.321, 200.322, 200.323, and 200.327. The updated policy will address competition through competitive bids, sole source selections, and retention of procurement documents. In addition, the policy will state the Federal requirements that are to be included in purchase orders and contracts.
View Audit 333243 Questioned Costs: $1
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Departme...
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Department resumed monitoring duties and developed a monitoring schedule to ensure subrecipients maintain program compliance. The Department also established a risk assessment tool that assess risk associated with each subrecipient. Records of subrecipient monitoring will be kept for a period of time to demonstrate monitoring activities were performed.
View Audit 333243 Questioned Costs: $1
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Departmen...
Assistance listing number and program name: 14.267 Continuum of Care Program Agency: Arizona Department of Housing (DOH) Name of contact person and title: Keon Montgomery, DOH Assistant Deputy Director of Programs Anticipated completion date: January 30, 2025 Agency’s Response: Concur The Department is no longer reimbursing the subrecipient for unsupported or ineligible costs and is pursuing repayment of funds from the subrecipient. Written policies for reviewing and approving subrecipient reimbursements, as well as, risk assessment were reviewed, updated and amended to ensure ongoing compliance. Staff has been trained and new policies were implemented in FY 2024 subsequent to the period reviewed in this audit. Contract Specialists in the Special Needs Division have received additional training through HUD TA support on CoC standards to ensure all request for reimbursement from subrecipients are eligible, reasonable and appropriately documented, including any allocations and purchasing requirements.
View Audit 333243 Questioned Costs: $1
Finding 515166 (2023-115)
Significant Deficiency 2023
Assistance listing numbers and program names: 14.231 Emergency Solutions Grant Program 14.231 COVID-19 - Emergency Solutions Grant Program 93.558 Temporary Assistance for Needy Families 93.558 COVID-19-Temporary Assistance for Needy Families Agency: Arizona Department of Economic Security (DES) Name...
Assistance listing numbers and program names: 14.231 Emergency Solutions Grant Program 14.231 COVID-19 - Emergency Solutions Grant Program 93.558 Temporary Assistance for Needy Families 93.558 COVID-19-Temporary Assistance for Needy Families Agency: Arizona Department of Economic Security (DES) Name of contact person and title: Molly Bright, DES CCSD Assistant Director Anticipated completion date: June 30, 2025 Agency’s Response: Concur The Department will stop the reimbursement of costs to all nonprofit and contracted subrecipients for items that are disallowed and/or restricted by the regulations of the federal Emergency Solutions Grant (ESG) program and Temporary Assistance for Needy Families (TANF) grant, including payments to personnel that violate the conflict-of-interest disclosure requirements. The Department will revise its expenditure review procedures to ensure compliance with these regulations prior to disbursing any ESG and/or TANF funding to any subrecipient for any purpose. These revisions will include review and approval by applicable management personnel prior to disbursement of federal funding. The Department is also in the process of establishing a divisional Monitoring and Compliance Policy and Procedure Manual which will establish procedures specific to subrecipient monitoring. The Department will continue to assess the risk of noncompliance violations for each subrecipient and establish a plan of action to address noncompliance. The plan of action will include an array of training and educational processes to ensure applicable personnel are knowledgeable of programmatic compliance requirements and Department contracts. The Department will also monitor subrecipients per its updated policies and procedures and will ensure proper oversight of federal expenditures as required by federal regulations. The Department has amended its contracts with the applicable subrecipients to more clearly outline the regulatory requirements and expectations for expenditures under the ESG and TANF grants. The Department will also continue to resolve the unallowable costs reimbursed to subrecipients as deemed appropriate by the applicable federal agencies.
View Audit 333243 Questioned Costs: $1
1. Elimination of Federal Allocation for Executive Salaries in 2023: Starting in 2023, KFA ensured that no executive salaries were charged to the federal funding portion of the foster care program, eliminating any potential misallocation. 2. Development of Cost Allocation Methodology: KFA has initia...
1. Elimination of Federal Allocation for Executive Salaries in 2023: Starting in 2023, KFA ensured that no executive salaries were charged to the federal funding portion of the foster care program, eliminating any potential misallocation. 2. Development of Cost Allocation Methodology: KFA has initiated the development of a consistent methodology for allocating direct and indirect costs. This includes A) Utilizing time certifications for staff whose work spans multiple foster care subprograms (e.g., ISFC, EISFC). B) Documenting allocation methods to ensure transparency and auditability. 3. Reconciliation Processes: Processes have been implemented to reconcile FC32 reports with functional expense statements and financial records to ensure consistency and accuracy. 4. Enhanced Training: Staff involved in financial reporting and cost allocation have received training on compliance with federal and state requirements, including proper preparation of FC32 reports. 5. System Enhancements: KFA is upgrading its financial management systems to facilitate accurate tracking of program-specific expenses and allocating costs to the appropriate funding sources.
1. Engaging CDSS for Clarification: KFA will formally engage the California Department of Social Services (CDSS) to clarify the applicability of federal guidelines for fee-for-service foster care providers. This includes obtaining specific guidance on financial reporting structure and reconciliation...
1. Engaging CDSS for Clarification: KFA will formally engage the California Department of Social Services (CDSS) to clarify the applicability of federal guidelines for fee-for-service foster care providers. This includes obtaining specific guidance on financial reporting structure and reconciliation requirements. 2. Enhancing Financial Management Systems: KFA is implementing a financial management system capable of tracking costs by funding source, program, and passthrough entity. This system will facilitate accurate allocation of both direct and indirect costs and ensure compliance with federal guidelines. 3. Developing Comprehensive Cost Allocation Methodology: A consistent and documented cost allocation methodology is being developed, which includes time certifications for staff whose work spans multiple programs. This methodology will be reviewed annually to ensure continued compliance with applicable regulations. 4. Strengthening FC32 Reporting: Processes are being established to reconcile FC32 reports with functional expense statements. Allocations for executive salaries to the federal program will adhere to the federal executive level 2 salary limitation as required. 5. Training and Documentation: Financial and administrative staff are receiving training on cost allocation principles, federal salary limitations, and FC32 reporting requirements. Comprehensive documentation of all methodologies and calculations will be maintained for transparency and audit readiness. 6. Monthly Reconciliations: A monthly reconciliation process is being implemented to ensure expenditures and revenues align with the terms and conditions of the foster care program.
APC has adopted a procurement policy(attached) that is compliant with the requirements of CFR and full full implementation of the policy will be complete by 12/31/2024
APC has adopted a procurement policy(attached) that is compliant with the requirements of CFR and full full implementation of the policy will be complete by 12/31/2024
We will continue to review our control procedures to obtain the maximum internal control possible under the circumstances.
We will continue to review our control procedures to obtain the maximum internal control possible under the circumstances.
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