Finding Text
Eligibility of Individuals, Allowable Costs Federal Program Workforce Innovation and Opportunity Act Cluster ALN 17.258, 17.259, and 17.278 Name of Federal Agency U.S. Department of Labor Compliance Requirement Eligibility of Individuals Allowable Costs Type of Finding Significant deficiency in Internal Control over Compliance and Other Matter Criteria Participant eligibility for services under the Workforce Innovation and Opportunity Act (WIOA) must be determined and documented in accordance with applicable statutory and regulatory requirements. Specifically: •WIOA Section 134 (29 U.S.C. §3174) establishes eligibility requirements for individuals receiving services under the Adult program. •20 CFR §680.120 provides that individuals receiving career services under the WIOA Adult program must be 18 years of age or older. •WIOA Section 188(a)(5) requires that participation in WIOA Title I programs be limited to citizens or nationals of the United States, lawfully admitted permanent residents, refugees, asylees, parolees, or other individuals authorized to work in the United States. •20 CFR §675.300 defines participant registration as the process of collecting identifying information necessary to determine eligibility for WIOA Title I services. In addition, the contracts executed with service providers require subrecipients responsible for providing training, skills training, and On-the-Job Training (OJT) services to determine participant eligibility in accordance with WIOA requirements. As part of the Department’s internal control procedures, subrecipients must maintain an eligibility certification and supporting documentation in each participant file to demonstrate compliance with WIOA eligibility requirements. Condition During our audit procedures related to participant eligibility, we reviewed 40 participant files associated with the Special Project administered by the subrecipient EV Media. Our review disclosed that one (1) participant file did not contain sufficient documentation to demonstrate that the individual met the WIOA Adult program eligibility requirements. Specifically, the participant file lacked: •Documentation supporting the participant’s age, and •Documentation supporting the participant’s citizenship, immigration status, or authorization to work in the United States, as required for participation in WIOA Title I programs. In addition, the subrecipient did not maintain the eligibility certification form required by the Department’s internal control procedures to document that the participant’s eligibility had been verified prior to receiving program services. Context From a sample of forty (40) Special Projects participants, one (1) participant (employee) eligibility documentation was not provided. Cause The deficiency occurred due to inadequate monitoring controls and insufficient supervisory review over the participant eligibility determination and documentation process. Management did not ensure that established procedures requiring the verification and retention of supporting documentation for participant eligibility were consistently followed. As a result, participant files were not always reviewed to confirm that required documentation, such as proof of age and authorization to work in the United States, was obtained and maintained prior to approving participation in the program. Effect Failure to properly document participant eligibility increases the risk that WIOA Adult program funds may be expended for individuals who do not meet program eligibility requirements, which could result in unallowable costs under federal regulations. This condition compromises the reliability of program records and participant data and weakens the Department’s ability to demonstrate compliance with WIOA requirements. If not corrected, the Federal awarding agency or pass-through entity may take enforcement actions authorized under 2 CFR §200.339, including temporarily withholding cash payments, disallowing costs, or imposing other remedies permitted under federal regulations. Questioned Costs The known questioned cost is $11,961.02, the amount in WIOA Adult funds expended on the participant whose eligibility could not be adequately supported. Identification as a Repeated Finding This is not a repeat finding from the immediate previous audit. Recommendation We recommend that the Department strengthen its internal controls over the monitoring of subrecipients (ALDLs) to ensure that participant eligibility determinations under the WIOA Adult program are properly verified and fully documented prior to enrollment and the delivery of services. The Department should require subrecipients to maintain complete supporting documentation for eligibility determinations, including evidence of age, citizenship or authorization to work in the United States, and other required eligibility criteria, in accordance with WIOA requirements. In addition, the Department should implement formal review and quality assurance procedures to verify that participant files maintained by subrecipients contain the required Recommendation documentation and that eligibility certifications are properly completed and retained. Management should also provide periodic guidance or training to subrecipient personnel on WIOA eligibility and documentation requirements and establish standardized eligibility verification checklists to promote consistent compliance across all local areas. Views of responsible officials and planned corrective actions Management of the Department agrees with this finding. Refer to the corrective action plan on pages 114-119.