FINDING REFERENCE NUMBER 2024-028 (See Finding Reference Number 2024-008) FEDERAL PROGRAM (ALN – 93.558) TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF) U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES AWARD NUMBERS 2022G996117 (Federal Award Year: 10/1/2021 – 9/30/2022) 2023996117 (Federal Award Years: 10/1/2022 – 9/30/2023) 2401PRTANF1 (Federal Award Years: 10/1/2023 – 9/30/2026) ADMINISTRATION ADMINISTRATION FOR SOCIOECONOMIC DEVELOPMENT OF THE FAMILY (ADSEF, BY ITS SPANISH ACRONYM) COMPLIANCE REQUIREMENT ELIGIBILITY TYPE OF FINDING INTERNAL CONTROL AND COMPLIANCE – MATERIAL WEAKNESS AND MATERIAL NONCOMPLIANCE CRITERIA Uniform Guidance at 2 CFR §200.303 (a) establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In accordance with the State Plan the following is the list of documents required for the regular verification process: photo Id, residency, citizen status, social security, income and resources, self-employment expenses, children school attendance, cooperation with the Individual Responsibility Plan and cooperation in the establishment of paternity or in obtaining child support. In Regulation 8684 to Establish Eligibility Standards for the Temporary Assistance for Needy Families from ADFAN, Chapter IV, Article 1 and 2, establishes that the certification period will be up to a maximum of six (6) months. In Chapter III, Article 4 Section 4.24 establish the participant will receive the benefit for a maximum period of sixty (60) months in total. In Chapter VIII, Article 2, Section 2.3, part B, it establishes that any eligible core member who intentionally violates the rules and receives benefits to which they are not entitled will be subject to a claim. In these cases, a collection invoice will be sent. In Chapter III, Article 3, Section 3.3, part 3, it establishes that the evaluation for determining the incapacity of applications or cases will be the responsibility of the ADSEF Central Level with the information available and will recommend the appropriate action. In addition, 2 CFR 200.303 (e) requires to take reasonable cybersecurity and other measures to safeguard information including protected personally identifiable information (PII) and other types of information. This also includes information the Federal agency or pass-through entity designates as sensitive or other information the recipient or subrecipient considers sensitive and is consistent with applicable Federal, State, local, and tribal laws regarding privacy and responsibility over confidentiality. STATEMENT OF CONDITION As part of our audit procedures over internal controls and compliance for eligibility requirements, we selected a sample of one hundred (100) participants who were active during the fiscal year under audit. During our audit we noted the following deficiencies: • Nineteen (19) cases lacked the documents requested for their initial appointment (photo ID, evidence of residency, social security and evidence of citizenship). • Eight (8) new participant files did not include supervisor approval of the eligibility determination. • Twenty (20) files submitted were outside the scope of the audit period, and no information related to our audit period was provided. • Several documents were missing from the files: • Fourteen (14) files did not include child support evidence. • Eleven (11) files without evidence of schooling for dependent minors. • Fourteen (14) files did not include signed Individual Responsibility Plan. • Twenty-one (21) files did not have the assignment of rights to Child Support. • Fifteen (15) files did not have the document stating that they had not been convicted of controlled substances. • One Category C case (disability) in which the benefit was granted to the family and they did not send the authorization to the Medical Social Board, who are responsible for determining eligibility in these cases. Further, the participants' social security number is used to assign the file number, and all physical files are identified with the social security number. In addition, the files are not uniform, and the documentation from the Nutrition Assistance for Puerto Rico, Payment to Territories and TANF are archived without maintaining an order, legend or uniformity between the regions. QUESTIONED COSTS None. PERSPECTIVE INFORMATION This deficiency is a systemic problem, lack of proper training and updated information to all personnel with the responsibility of determining, supervising, and monitoring the eligibility determinations and follow-up. The sampling was a statistical valid sample. STATEMENT OF CAUSE ADSEF lacks supervisory review, delays in updating participant information, and insufficient controls over eligibility verification, income documentation, and file maintenance. There are no formal trainings for all regions and locals for the personnel involved in eligibility determination and subsequent follow-up. In addition, ADSEF does not have proper instructions and control over how the information should be archived in the participants’ files. POSSIBLE ASSERTED EFFECT Improper documentation and ineligible determinations increase the risk of noncompliance and may result in improper benefit payments. In addition. ADSEF is not properly safeguarding PPI of participants. In addition, the way information is being filed in the records does not allow for adequate monitoring of the documents and information necessary to comply with Federal regulations. IDENTIFICATION OF REPEAT FINDING This is a repeat of a finding reported in the prior audit as Finding Numbers 2023-010/2023-038. RECOMMENDATIONS We recommend ADSEF to strengthen internal controls to ensure complete and accurate eligibility documentation and improve timeliness of recertifications. ADSEF should establish a schedule for continuous training for personnel in charge of eligibility determinations. In addition, other identification numbers should be used for participants instead of the social security number.