Finding 394879 (2022-008)

2022-008 LCTS Reporting Prior Year Finding Number: N/A Repeat Finding Since: N/A Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Program: 93.778 Medical Assistance Program Award Number and Year: 2205MN5ADM, 2022 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. For County federal awards received from the Minnesota Department of Human Services (DHS), internal control should be established and maintained to provide assurance that program reports submitted to DHS are accurate and completed in accordance with DHS reporting instructions. DHS Bulletin No. 16-32-04 requires the Local Collaborative Time Study (LCTS) Fiscal Reporting and Payment Agent to review DHS-3220 quarterly reports prior to their submission. Condition: In our sample of eight DHS-3220 reports tested, none had any indication of a review being completed by someone other than the preparer of the report. Questioned Costs: None. Context: The expenditures reported on the DHS-3220 reports are used to determine federal reimbursements for the Medical Assistance Program and Foster Care – Title IV-E federal programs related to the local collaborative time study. The sample size was based on the guidance from chapter 11 of the AICPA Audit Guide, Government Auditing Standards and Single Audits. Effect: If reviews are not performed, there is an increased possibility that an error will occur and not be detected, resulting in the County receiving the incorrect amount of federal reimbursements. Cause: The employee acting as the County's Fiscal Reporting and Payment Agent was not aware of the need for a review to be performed of the reports that the employee prepares. Also, the County informed us that reviews over the DHS-3220 reports completed by the collaborative partners were being performed, but these reviews were not being documented. Recommendation: We recommend a review by someone other than the preparer be conducted for all DHS-3220 quarterly reports prepared by the County and its collaborative partners prior to submission to the Minnesota Department of Human Services. Documentation of these reviews should be retained by the County. View of Responsible Official: Concur