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Section 14: Monitoring and Compliance Proper oversight and monitoring of LIHEAP funds are important in order to ensure compliance with federal and state LIHEAP policies, procedures, and law. Monitoring can also be important in identifying additional controls and procedures that could strengthen a service provider or the overall program. The state is responsible for monitoring fiscal and program performance of the subgrantee’s, per LIHEAP statute, Section 2605(b)(10). Additionally, the state must ensure their own compliance with federal and state policies because it is subject to periodic monitoring by federal staff, as outlined in LIHEAP statute, Section 2608(b)(1). IHCDA EAP monitoring has evolved over the years from a simple file review to a more comprehensive system to ensure each LSP has the capacity to administer the program effectively as well as for IHCDA to meet its federal obligation. To accomplish this, the monitoring covers the complete content of the EAP Program Manual, EAP Award Agreement requirements, as well as any issued EAP Policy Guidance (Refer to Section 15 for additional details) during the program year. 14.1 Monitoring Season When the EAP season officially begins in November, the EAP Monitor performs a courtesy “spot check” of files for LSPs that are participating. There are no punitive actions that result from items observed during the spot check. The process is designed to be educational in nature and make the LSP aware of possible issues so they may be corrected, and additional staff training provided, as needed. Each year, IHCDA submits the State Plan to HHS which contains a section on program integrity. This includes IHCDA’s risk analysis and fraud prevention strategies. IHCDA is required by HHS to conduct a risk assessment on each LSP each year. IHCDA reviews a variety of LSP factors when determining risk. A medium risk and a high risk score may impact the number of client files reviewed during the monitoring session or require the LSP to perform other actions as deemed appropriate. The compliance monitoring season for EAP runs approximately from January through October. IHCDA will monitor all LSPs each program year. IHCDA will use a risk-based approach for scheduling. The risk assessment score will be a factor in determining placement on the monitoring schedule. Higher risk LSPs should be placed towards the beginning of the schedule. 14.2 Monitoring Process Overview The review is conducted by the IHCDA Community Programs Monitors (EAP & Fiscal) and/or a possible fiscal monitoring subcontractor of IHCDA. The IHCDA Community Programs EAP Monitor will serve as the agencies’ point of contact, oversee the complete process including issuing all reports, interviewing the LSP EAP Manager, collecting documentation, and evaluating compliance. Working closely with the EAP monitor, the fiscal monitor will primarily be responsible for reviewing fiscal operations, fiscal files and possibly interviewing fiscal staff. The monitors ensure compliance with existing policy,