Finding Text
FINDING REFERENCE NUMBER 2024-033 (See Finding Reference Number 2024-012) FEDERAL PROGRAM (ALN – 93.556) MARYLEE ALLEN PROMOTING SAFE AND STABLE FAMILIES U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES AWARD NUMBER 2101PRFPSS (Federal Award Year: 10/1/2021 – 9/30-2023) ADMINISTRATION ADMINISTRATION FOR FAMILIES AND CHILDREN (ADFAN, BY ITS SPANISH ACRONYM) COMPLIANCE REQUIREMENT MATCHING, LEVEL OF EFFORT, EARMARKING TYPE OF FINDING INTERNAL CONTROL AND COMPLIANCE – MATERIAL WEAKNESS AND MATERIAL NONCOMPLIANCE CRITERIA The 45 CFR section 1357.32(d) establishes that the program contains assurances that not more than 10 percent of expenditures under the plan for any fiscal year with respect to which the State is eligible for payment under section 629d of this title for the fiscal year shall be for administrative costs, and that the remaining expenditures shall be for programs of family preservation services, community-based family support services, family reunification services, and adoption promotion and support services, with significant portions of such expenditures for each such program. According to the Compliance Supplement, the portion established for expenses by category is 20%. STATEMENT OF CONDITION As part of our audit procedures over internal controls and compliance with earmarking requirements, we selected the Grant Award 2203PRFPSS, which closed within the audit period from July 1, 2023, to June 30, 2024, to assess the allocation and use of funds across the required program categories. Based on our evaluation of the documentation provided by ADFAN, we found that expenditures in each of the following categories: family preservation services, community-based family support services, time-limited family reunification services, and adoption promotion and support services did not meet the 20% minimum allocation. Additionally, we noted that administrative expenditure related to training exceeded the 10% cap. QUESTIONED COSTS None. PERSPECTIVE INFORMATION This deficiency is a systemic problem. ADFAN does not have written internal control and compliance procedures that clearly identify the process to monitor this requirement and the person responsible. STATEMENT OF CAUSE ADFAN lacks adequate internal controls to effectively monitor whether expenditures within each category align with allocated funding and comply with applicable program requirements. POSSIBLE ASSERTED EFFECT ADFAN’s failure to adhere to program requirements may adversely impact its ability to receive full Federal funding under the program. IDENTIFICATION OF REPEAT FINDING This is a repeat of a finding reported in the prior audit as Finding Numbers is 2023-015/2023-043. RECOMMENDATIONS We recommend ADFAN establish written internal control procedures that provide for the monitoring of the expenditure of allocated funds of each category, and the person responsible for executing this process in order to comply with the corresponding earmarking requirement.