Finding Text
Finding 2023-004
Program Federal Assistance Listing and Title: 93.778 Medicaid Cluster
State ID Numbers and Titles: 435.283 IMAA State Share
395.168 Elderly and Handicapped County Aids
Award Numbers: Unknown
Federal Agency: U.S. Department of Health and Human Services
Pass-Through Agency: Wisconsin Department of Health Services
State Agencies: Wisconsin Department of Health Services
Wisconsin Department of Transportation
Criteria: 2 CRF 200.303 Internal Controls requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements. The State Single Audit Guidelines (SSAG) require that local entities receiving State awards establish and maintain internal control designed to reasonably ensure compliance with laws, regulations and program compliance requirements. To minimize the risk of errors, internal controls should be in place for all program compliance requirements, including appropriate review and approval of expenditures.
Condition/Context: During our testing, we were unable to view approval for the following number of expenditures in each program:
• 93.778: 4 out of 7 of the expenditures tested.
• 395.168: 15 out of 40 of the expenditures tested.
• 435.283: 3 out of 6 of the expenditures tested.
These samples were not statistically valid.
Cause: While review controls are in place, the County's system does not currently allow access to view the documentation of approval of payroll expenses beyond 365 days.
Effect: Record retention requirements are not currently being met, which prevents outside reviewers from verifying whether or not effective controls over payroll exist for transactions older than 365 days.
Questioned Costs: None noted.
Recommendation: The County should work with its software provider and IT personnel to enhance documentation retention surrounding payroll approval support.
Management Response: The County is aware that there is a lack of controls over its year-end financial reporting process. The County will endeavor to evaluate the need to increase additional staff to meet the deficiencies noted in the finding. However, because of its size, the County does not feel it is cost-effective to hire the number of employees needed to complete these tasks in-house at this point in time and will rely on an outside audit firm to review financial statements, disclosures and schedules. County administration and financial staff review the adjustments and reports prepared by the auditors to ensure the accuracy of the information.