Finding Text
FINDING REFERENCE NUMBER 2024-051 FEDERAL PROGRAMS (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) 2023G996117 (Federal Award Year: 10/1/20212 – 9/30/2023) 2401PRTANF1 (Federal Award Years: 10/1/2023 through 9/30/2026) ADMINISTRATION ADMINISTRATION FOR SOCIOECONOMIC DEVELOPMENT OF THE FAMILY (ADSEF, BY ITS SPANISH ACRONYM) COMPLIANCE REQUIREMENT SPECIAL TESTS & PROVISIONS – PENALTY FOR REFUSAL TO WORK / LACK OF CHILD CARE FOR SINGLE CUSTODIAL PARENT OF CHILD UNDER AGE SIX / PENALTY FOR FAILURE TO COMPLY WITH WORK VERIFICATION PLAN TYPE OF FINDING INTERNAL CONTROL AND COMPLIANCE – MATERIAL WEAKNESS AND MATERIAL NONCOMPLIANCE CRITERIA 2 CFR 200.334, Record retention requirements, establishes that: the recipient and subrecipient must retain all Federal award records for three years from the date of submission of their final financial report. For awards that are renewed quarterly or annually, the recipient and subrecipient must retain records for three years from the date of submission of their quarterly or annual financial report, respectively. Records to be retained include but are not limited to financial records, supporting documentation, and statistical records. Further, in §200.337, Access to records, requires in (a) Records of recipients and subrecipients. The Federal agency or pass-through entity, Inspectors General, the Comptroller General of the United States, or any of their authorized representatives must have the right of access to any records of the recipient or subrecipient pertinent to the Federal award to perform audits, execute site visits, or for any other official use. This right also includes timely and reasonable access to the recipient's or subrecipient's personnel for the purpose of interviewing and discussion related to such documents or the Federal award in general. STATEMENT OF CONDITION As part of our audit procedures related to tests and special provisions, we selected the following samples: a. Five (5) participants from a population of 23 individuals who were sanctioned for non-compliance with the employment requirement. b. Twenty-five (25) files from a population of 294 participants who were sanctioned for non-compliance with the employment verification plan. c. Twenty-five (25) files from a population of 285 participants who had documented just cause for not having childcare responsibilities. During our review of the selected files, we identified the following deficiencies: a. Just Cause for Not Having Childcare Responsibilities 1. Five (5) files were not provided for audit review. b. Sanctioned for Non-Compliance with the Employment Requirement 1. One (1) file did not contain information for the audit period under review. 2. One (1) file was in the process of being digitized and was therefore unavailable for evaluation. c. Non-Cooperation with the PRI 1. Five (5) files were not provided for audit review. 2. Three (3) files did not indicate the sanction period. 3. Three (3) files lacked documentation for the audit period under review. 4. One (1) file did not contain the required forms necessary to evaluate the sanction. QUESTIONED COSTS None. PERSPECTIVE INFORMATION This deficiency is systematic. ADSEF lacks an adequate process for archiving files and the information each file should contain. This is a statistically valid sample. STATEMENT OF CAUSE ADSEF does not have an adequate archiving process that allows for the identification of files in a reasonable timeframe. Additionally, there is no formal training or archive process for all regions and local authorities for the personnel involved in determining eligibility and the required evidence that should be kept for the audit process. Further, the information related to any sanction should be clearly identified in the participant’s file, so a follow up can be performed adequately and timely. POSSIBLE ASSERTED EFFECT ADSEF was unable to provide the requested information for auditing within a reasonable timeframe. Furthermore, the lack of a uniform archiving process prevents the information contained in the files from being properly identified and reviewed. In addition, these deficiencies in the documentation, do not allow proper follow-up of the sanction period, this could allow payments to participants who are not in compliance with the regulations. IDENTIFICATION OF REPEAT FINDING This is a repeat of a finding reported in the prior audit as Finding Numbers is 2023-060. RECOMMENDATIONS We recommend that management establish an adequate internal controls process that provides for the archiving of information in participant files and the identification of files within a reasonable timeframe. In addition, a structure for follow up on the sanctions should be in place in order to properly monitor compliance with this requirement.