10.1 Effective Internal Controls

Lead Agencies must ensure the integrity of the use of CCDF funds through effective fiscal management and must ensure that financial practices are in place. Lead Agencies must have effective fiscal management practices in place for all CCDF expenditures. 10.1.1 Organizational structure to support integrity and internal controls Describe how the Lead Agency’s organizational structure ensures the oversight and implementation of effective internal controls that promote and support program integrity and accountability. Describe: 1. Assignment of authority and responsibilities related to program integrity In Idaho, the CCDF Program is administered by the CCDF Administrator known locally as the Child Care Program Manager. CCDF is administered within the Division of Self Reliance as part of the Idaho Department of Health and Welfare (IDHW). Within IDHW, the CCDF administrator works with other divisions, bureaus, and programs to ensure the program is ran with effective internal controls with specific attention to program integrity. IDHW’s organizational structure is designed to ensure rigorous oversight and implementation of internal controls that bolster program integrity and accountability. 2. and 3. Delegation of duties and coordination of activities Duties are delegated to staff based on their job title and essential job functions. Staff are trained on items such as Confidentiality, Program Integrity, HIPAA policies, grant administration and security training to ensure and promote program integrity. The CCDF administrator meets routinely and as needed with the managers supervising and the staff maintaining the following efforts: Self Reliance Operations- overseeing the Customer Support Staff and Self Reliance Specialists conducting subsidy eligibility determinations. Self Reliance Integrity Unit- The Idaho Department of Health and Welfare’s Division of Welfare houses a program integrity unit. The Self-Reliance Integrity Unit (SRIU) staff are responsible for program integrity and completion of all aspects of case work. They review programs including Medicaid, Supplemental Nutrition Assistance Program, Idaho Child Care Program, Temporary Assistance in Idaho, and Aid to the Aged, Blind and Disabled. They must review of all facets of casework to include interviewing, data collection, fact gathering, case set up, error detection, case correction, processing eligibility, processing overpayments, review all actions for intent to receive benefits without entitlement, and completion of all fraud actions. Fraud actions include completing intentional program violations, hearings, overpayments, and preparing cases for prosecution. All actions must align to state and federal guidelines. Self Reliance Resolutions Unit- managing client and provider overpayments, fair hearings and appeals, escalations, and public records requests. Bureau of Compliance and Support including CERM (Contracts and External Resource Management) Team- This team monitors administrative implementation and responsibilities and ensures that the standards, techniques, and criteria identified in the contract’s scope of work are consistent and timely. This team also reviews and processes the division’s invoices. Division of Management Services- provides administrative services to support the department. The division oversees units such as facilities, criminal history background checks, internal audit, and investigation services. Division of Financial Services- ensures adequate cash is available for the department to meet its financial obligations and functions as the financial liaison to human services programs by drawing federal funds from the U S Treasury to meet immediate cash needs of federally funded programs; Requesting state general and dedicated funds through the Office of the State Controller; Preparing expenditure reports; Preparing and submitting the department's annual budget request to the Division of Financial Management and Legislative Services; Distributing appropriated funding to operating budgets within the department; Monitoring program expenditure trends to allocated funding; Preparing various financial analysis and reporting for division and executive management; Monitoring established positions; Researching and compiling historical expenditure and revenue information. 4. Communication between fiscal and program staff. All invoices are reviewed for allowable uses and contract compliance prior to payment. Program and Fiscal staff meet each month to review expenditures and monitor budgets. The Idaho Department of Health and Welfare's finance department tracks expenditures to specific accounts and funding sources. Monthly reports are provided to divisions for review as well as quarterly budget meetings take place to review budgets. 5. Segregation of duties. All contracted entities submit monthly expenditures for which the Idaho Department of Health and Welfare's Contracts and External Resource Management (CERM) reviews for accuracy and then submits to the fiscal department for processing, approval, and payment. Contract monitoring tools are developed in coordination with the program, but monitoring is conducted independently by CERM team staff. Findings are submitted to the Child Care Program Manager for review and approval prior to submission to the contractor. If any items were found deficient, the monitor team meets with the contract manager to discuss possible adverse conditions and determine the severity of each. Developing and organizing deficiencies is critical to the process. It will assist in determining whether all pertinent information was obtained during the monitor and facilitate discussions and decisions related to the potential findings. Each finding is supported with specific examples and concrete details. The CERM team submits final results to contractor, contract manager, Division of Welfare administrator, and bureau chief over Compliance and Support. If there were findings, the contractor will be given a date by which to submit reimbursement, performance improvement, or corrective action plan. 6. Establishment of checks and balances to identify potential fraud risks. Our review process is set up to find any areas in which our performance is at risk, pinpoint the area of concern (whether policy, process, or training), and quickly respond to the field needs either at the local level or roll out statewide based on the findings. For each processing center/field office reviewed, the case reviews incorporate initial contact with the Idaho Department of Health and Welfare through approval/denial as well as acting on changes. We review program access, integrity, system keying standards, and maintenance. Our reviews also include customer service standards and timeliness. Our review profile captures error causes and we have reports which help us to identify any error trends. Any errors discovered are sent for immediate correction. Errors are shared with the field program managers for individual performance management as well as used for identifying statewide trends. The bureau chiefs for operations and operations design identify areas in which we can provide statewide training when necessary which supports our statewide business model. Include the following elements in your description: 1. Assignment of authority and responsibilities related to program integrity. 2. Delegation of duties. 3. Coordination of activities. 4. Communication between fiscal and program staff. 5. Segregation of duties. 6. Establishment of checks and balances to identify potential fraud risks. 7. Other activities that support program integrity. 10.1.2 Fiscal management practices Describe how the Lead Agency ensures effective fiscal management practices for all CCDF expenditures, including: a. Fiscal oversight of CCDF funds, including grants and contracts. Describe: The Idaho Department of Health and Welfare (DHW) has real time verification standards embedded into initial eligibility processes. In real time, self-reliance specialists can use our various interfaces to verify information necessary to determine eligibility and begin services. Monthly dependent care forms are submitted, outlining payment billed amounts completed in partnership with parents and signed by parents and providers, verifying the amounts articulated are verified by the parent and provider. The form is then submitted to DHW for payment. Each year, all providers sign a provider agreement for child care which outlines the requirements for participating in the program including appropriate record keeping. The Lead Agency maintains overall control of expenditures by monitoring performance- based contracts for compliance with federal regulations and the scope of work for all written contracts and agreements. This includes, but is not limited to, contracts for IdahoSTARS and the Health Districts. Contracts contain language that requires the contractor to certify that federal and state guidelines are followed. In addition to on-site record reviews conducted by the CERM team, contractors and Grantees are required to submit semi-annual performance reports on specific performance indicators. Additionally, all contracted entities submit monthly expenditures that are reviewed for accuracy, and contractual compliance prior to submission to the fiscal division for processing, approval, and payment. b. Tracking systems that ensure reasonable and allowable costs and allow for tracing of funds to a level of expenditure adequate to establish that such funds have not been used in violation of the provision of this part. Describe: The Idaho Department of Health and Welfare's finance department tracks expenditures to specific accounts and funding sources. Monthly reports are provided to divisions for review as well as quarterly budget meetings take place to review budgets. c. Processes and procedures to prepare and submit required state and federal fiscal reporting. Describe: The ACF-696 report is completed quarterly by the Grant Reporter within the Division of Financial Services using financial information compiled in our statewide financial management system, Luma, as well as the reporting amounts using the Child Care & Development Block Grant (CCDBG) Quarterly Workpapers. These workpapers are created using a report from Fiscal and are tied to Fiscal each month to ensure accuracy. The Grant Reporter tracks the match and MOE requirements based upon ACF annual requirements posted online. The Quarterly Workpapers are broken out by their sources, which are the Mandatory Fund, the Matching Fund and the Discretionary Fund, which includes TANF Transfer (Grant 1262TF). This aids the Lead Agency in meeting their multiple compliance requirements. The majority of the worksheets are pre-formulated and automated to prevent inaccurate information from being entered. The Child Care Program Manger provides secondary a review of the work papers each month and there is a double check at the bottom of the spreadsheet to confirm there are no variances. The report is then routed for review and approval to the Cash Analyst, Budget Analyst, and Financial Manager, all staff in the Division of Financial Services under the leadership of the Lead Agency's Chief Financial Officer. Review of the report includes comparing reported data to supporting records in the grant folder. The Unit Supervisor will also review prior quarter and year-to-date amounts to verify that amounts are reasonable. Documentation of the persons preparing, reviewing, and approving the ACF-696 are done by initialing and dating the routing slip. The ￿Report Electronically Filed￿ sign-off on the routing slip is not the date the report was filled; it is the date data entry was done. The Financial Executive Officer does a final review of the report to the supporting excel file CCDBG, the support in the report folder, and additional notes in the report folder, and if there are no errors noted, signs and submits the report. d. Other. Describe: 10.1.3 Effectiveness of fiscal management practices Describe how the Lead Agency knows there are effective fiscal management practices in place for all CCDF expenditures, including: a. How the Lead Agency defines effective fiscal management practices. Describe: Effective fiscal management practices involve regular monitoring, transparent accounting procedures, and adherence to federal and state guidelines to ensure proper allocation and use of CCDF funds. This includes detailed monthly reviews, rigorous expenditure tracking, and multiple controls for payouts, supported by advanced fiscal projection tools. b. How the Lead Agency measures and tracks results of their fiscal management practices. Describe: The Idaho Child Care Program measures the effectiveness of fiscal management through performance indicators such as expenditure rates, compliance with budget allocations, and audit results. Automated resources such as expenditure tracking systems and monthly financial reporting are utilized, in addition to frequent staff and leadership review of reports, and on-site monitoring of contracted partners measures and tracks indicators consistently. All audit results are reviewed at each level of leadership within the Division of Self Reliance and the Division of Management Services to develop improvements based on all results. c. How the results inform implementation. Describe: Both the Statewide Single Audit and the Internal Audit teams publish findings resulting from their audits. These findings indicate what caused the error, and each finding requires a management response in the form of a corrective action plan. Results of monitoring or auditing are shared with program staff and department leadership and used to impact staff training and organizational decisions. At the grant and program level, similar informal procedures are performed to correct issues that are discovered as part of the review process. d. Other. Describe: NA 10.1.4 Identifying risk Describe the processes the Lead Agency uses to identify risk in the CCDF program including: a. Each process used by the Lead Agency to identify risk (including entities responsible for implementing each process). Describe: For subsidy payments, Supervisory reviews are completed annually. Our review process is set up to find any areas in which our performance is at risk, pinpoint the area of concern (whether policy, process, or training), and quickly respond to the field needs either at the local level or roll out statewide based on the findings. For each processing center/field office reviewed, the case reviews incorporate initial contact with the Idaho Department of Health and Welfare through approval/denial as well as acting on changes. We review program access, integrity, system keying standards, and maintenance. Our reviews also include customer service standards and timeliness. Additionally, all eligibility staff are able to submit any subsidy case or provider for additional review by the Self Reliance Integrity Unit if concerns are identified. All contracts contain language that requires the contractor to certify that federal and state guidelines are followed. In addition to on-site record reviews conducted by the CERM team, contractors and Grantees are required to submit semi-annual performance reports on specific performance indicators. Additionally, all contracted entities submit monthly expenditures that are reviewed for accuracy, and contractual compliance prior to submission to the fiscal division for processing, approval, and payment. Contract monitoring tools are developed in coordination with the program, but monitoring is conducted independently by CERM team staff. Findings are submitted to the Child Care Program Manager for review and approval prior to submission to the contractor. If any items were found deficient, the monitor team meets with the contract manager to discuss possible adverse conditions and determine the severity of each. Any finding is supported with specific examples and concrete details. The CERM team submits final results to contractor, contract manager, Division of Welfare administrator, and bureau chief over Compliance and Support. If there were findings, the contractor is given a date by which to submit reimbursement, performance improvement, or corrective action plan. b. The frequency of each risk assessment. Describe: Risk assessment is completed on an ongoing basis. Daily evaluation occurs in eligibility determination. Ongoing supervisory quality control reviews are conducted on subsidy cases as well. A thorough risk assessment is completed prior to awarding any subgrant or contract and upon each annual renewal. All child care providers complete an updated Provider Agreement annually validating that they are not on the Office of Inspector General’s Exclusion List. The Lead Agency conducts the triennial improper payments review in addition to frequent legislative audits of all levels of programming. c. How the Lead Agency uses risk assessment results to inform program improvement. Describe: Our review profile captures error causes, and we have reports which help us to identify any error trends. Any errors discovered are sent for immediate correction. Errors are shared with the field program managers for individual performance management as well as used for identifying statewide trends. The bureau chiefs for operations and operations design identify areas in which we can provide statewide training when necessary, which supports our statewide business model. For contracts and subgrants, the Lead Agency requires risk assessments to evaluate potential subrecipients’ capacity to comply with federal and state regulations and the terms of the subaward. The aim is to identify the appropriate allocation of monitoring resources towards subrecipients based on their risk of noncompliance with Federal statutes, regulations, and the terms and conditions of specific subawards. This process is intended to optimize resource allocation, minimize waste, and enhance decision-making in the monitoring of subrecipients. Programs document assessment results and decisions regarding monitoring activities for each subrecipient. These records must be signed and dated by monitoring staff, supervisors or managers, and designated compliance officers. Clear communication of results to all relevant parties is essential to ensure understanding and alignment on planned monitoring activities. d. How the Lead Agency knows that the risk assessment processes utilized are effective. Describe: The Lead Agency requires all subgranting and contracting programs to develop a monitoring plan that covers every subrecipient. Considerations such as staffing resources and the geographic distribution of subrecipients across the State, guide the development of monitoring activities. Adequate oversight is crucial for maintaining performance standards, particularly amid staffing changes and other influencing factors. Early issue resolution can preempt problems and minimize the need for extensive technical assistance later on. The Lead Agency maintains overall control of expenditures by monitoring performance- based contracts for compliance with federal regulations and the scope of work for all written contracts and agreements. This includes, but is not limited to, contracts for IdahoSTARS and the Health Districts. Contracts contain language that requires the contractor to certify that federal and state guidelines are followed. In addition to on-site record reviews conducted by the CERM team, contractors and Grantees are required to submit semi-annual performance reports on specific performance indicators. Additionally, all contracted entities submit monthly expenditures that are reviewed for accuracy, and contractual compliance prior to submission to the fiscal division for processing, approval, and payment. The results of the submitted reports and on-site monitoring evaluation continue to demonstrate our program’s success with minimal findings, expeditious resolutions, and compliance rates exceeding the contractual requirements. The Idaho Child Care Program has received successful results in triannual error rate reviews, annual Legislative audits, and semi-annual monitoring of CCDF funded contracts indicates successful program implementation and risk management. e. Other. Describe: NA 10.1.5 Processes to train about CCDF requirements and program integrity Describe the processes the Lead Agency uses to train staff of the Lead Agency and other agencies engaged in the administration of CCDF, and child care providers about program requirements and integrity. a. Describe how the Lead Agency ensures that all staff who administer the CCDF program (including through MOUs, grants, and contracts) are informed and trained regarding program requirements and integrity. i. Describe the training provided to staff members around CCDF program requirements and program integrity: The Idaho Department of Health and Welfare's Division of Self Reliance trains all self-reliance specialists on each program administered within the division. Training includes videos on program rules, policies, general program details, process documents, helpful tools, release notices, and monthly management reviews. ii. Describe how staff training is evaluated for effectiveness: The Bureau Chief over Operations monitors various reports on a daily, weekly, and monthly basis. Program managers receive reports on their region to identify and review results and create training opportunities in areas of the business requiring additional assistance to meet targets. Monthly supervisor reviews aid in the identification and prevention of agency errors because it allows for a review of more eligibility cases and training where needed. iii. Describe how the Lead Agency uses program integrity data (e.g., error rate results, risk assessment data) to inform ongoing staff training needs: Idaho uses program integrity data to identify risk areas for training and or policy clarifications. Idaho conducts error rate reviews in real time allowing any potential errors to immediately become learning and training opportunities for staff to learn from supervisors and case reviewers. When not conducting case reviews for the error rate, staff receive regular ongoing training on any policy or rule changes made to the program and materials are updated on a regular basis using feedback from partners to improve process documents and policy guidance. b. Describe how the Lead Agency ensures all providers for children receiving CCDF funds are informed and trained regarding CCDF program requirements and program integrity: i. Describe the training for providers around CCDF program requirements and program integrity: Every provider who starts a child care business that accepts CCDF funds receives an Idaho Child Care Program (ICCP) orientation with a CCRC Resource Specialist. The provider is provided slides and a provider guidebook with a follow-up visit after they have completed the process and has received a vendor number. The content of the ICCP orientation, supporting materials, and follow-up contact informs the provider of ICCP rules, required processes and support with implementing the requirements. Every new provider is introduced to their local CCRC staff, their customer support team, the 2-1-1 Idaho Careline, and the IdahoSTARS website. Local and state resources are provided and opportunities for professional development are shared and encouraged. The Idaho Child Care Program (ICCP) notifies providers of policy changes through required annually updated provider agreements, email and mailed policy notifications, IdahoSTARS newsletters, and pop-ups in the RISE database system. ii. Describe how provider training is evaluated for effectiveness: Provider training is evaluated through audit outcomes, training requests, and based on informally extracting recurrent themes in informal and formal technical assistance provided to child care providers within their regions. iii. Describe how the Lead Agency uses program integrity data (e.g., error rate results, risk assessment data) to inform ongoing provider training needs: Staff from the Self Reliance Integrity Unit and Self Reliance Fair Hearing Unit meet regularly with Child Care Program staff to review data, challenging cases, policy questions, and process needs for all child care cases. Any consistent findings associated to providers are reviewed and shared with IdahoSTARS leadership for referral for technical assistance or updated trainings. Additionally, consistent findings can be used to inform annual updates to the Provider Agreement for improved clarity and compliance. 10.1.6 Evaluate internal control activities Describe how the Lead Agency uses the following to regularly evaluate the effectiveness of Lead Agency internal control activities for all CCDF expenditures. a. Error rate review triennial report results (if applicable). Describe who this information is shared with and how the Lead Agency uses the information to evaluate the effectiveness of its internal controls: Idaho conducts error rate reviews in real time allowing any potential errors to immediately become learning and training opportunities for staff to learn from supervisors and case reviewers. ACF-404 results are shared with division leadership, child care program staff, and quality control team and Lead Agency staff may use error rate results if a pattern is identified concerning incorrect eligibility decisions and is promptly addressed through training or policy updates. Final results are shared with legislative auditors when requested and inform staff training, organizational decisions, policy development and ongoing refinements. b. Audit results. Describe who this information is shared with and how the Lead Agency uses the information to evaluate the effectiveness of its internal controls: Idaho’s Legislative Services Office conducts routine audits of IDHW programs including this Idaho Child Care Program. Audits are either fiscal or performance in nature during which state auditors review the Lead Agency’s policies, procedures, fiscal records, systems and databases, and relevant documents to determine compliance with state and federal requirements. Audits provide the Lead Agency with regular outside analysis of program operations and potential weaknesses in the system. Audit outcomes are made publicly available, presented to the legislature annually, and shared with leadership from the Divisions of Self Reliance and Management Services, and child care program staff. Lead Agency staff work to promptly address any findings through staff training, policy updates, and/or system improvements. c. Other. Describe who this information is shared with and how the Lead Agency uses the information to evaluate the effectiveness of its internal controls: NA 10.1.7 Identified weaknesses in internal controls Has the Lead Agency or other entity identified any weaknesses in its internal controls? a. [x] No. If no, describe when and how it was most recently determined that there were no weaknesses in the Lead Agency’s internal controls. The Lead Agency routinely works to improve internal controls via data management, process improvements, and consistent training. The child care program participates in annual audits conducted by Legislative Services Office, any potential findings are promptly addressed and resolved. At this time there are no concerns with internal controls. b. [ ] Yes. If yes, what were the indicators? How did you use the information to strengthen your internal controls?