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: The CCDF Program is administered by the CCDF Administrator. The CCDF Administrator works directly with the Director of the Office of Economic Assistance to ensure the program is ran with effective internal controls. The CCDF Administrator directly supervises the CCDF Federal Aid Administrator III who manages Child Care Grants. DHHS maintains a Model Internal Control plan that governs its fiscal management. The Lead Agency has written policies and procedures that address all of the process and control activities for ensuring that reporting is complete and accurate, and maintains a tracking system to ensure timely compliance. The Lead Agency has developed a Federal Funding Accountability and Transparency Act worksheet that is submitted with all subawards. All reports are reviewed by supervisors to ensure accuracy and completion. The Lead agency separates responsibility for preparing reports on one had and reviewing and filing reports on the other, ensuring that no single individual is solely responsible for the content of reports. 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: Monthly case reviews are completed on subsidy cases. Some cases are targeted, looking at the dollar amount of subsidy paid out. Where there is a finding, cases are referred to the fraud unit and overpayments are determined. Monthly reports are generated that provide data on the subsidy spending of federal and state funds. CCDF sub-awards and contracts are reviewed at the time of startup or renewal by the CCDF Lead Agency Grant Program Coordinators and CCDF Administrator, Legal Services, Support Services, and Financial Services. Ongoing monitoring is with the CCDF Grant Program Coordinator and CCDF Administrator. Monthly CCDF Grant Meetings are held with CCDF staff, administration, and finance staff. The Internal Audit Unit also conducts internal audits on a selection of the sub-recipients and subsidy. The CCDF team and administration review monthly spending reports that reflect the amount of CCDF federal funds and state general funds spent on child care subsidy and CCDF grants. Reports help project future spending. 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: All sub-awards and contracts are approved with language stating the Department agrees to pay the subrecipient for actual, allowable, and reasonable costs of the activities described in the agreed-upon budget. Reimbursement (payment) requests from the subrecipient are reviewed and tracked on an Excel spreadsheet. The CCDF Grant Program Coordinator also works closely with the Lead Agency’s finance and grant departments when reviewing and making payments. c. Processes and procedures to prepare and submit required state and federal fiscal reporting. Describe: Fiscal and Grant Management staff prepare state and federal reports. Reports are shared with the CCDF Program Administrator and Deputy Director of Quality, Program Integrity, and Finance for review. Once approved, they are submitted appropriately. 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: DHHS abides state policy by employing an Internal Audit team that regularly tests policies and procedures, and ensures that allowable use guidelines are followed. This team also ensures that corrective action plans and other deliverables are met subsequent to the annual single audit. DHHS’s single audit performs audits of Agency federal award expenditures as required by OMB. DHHS further ensures compliance through regular meetings between central finance and the programs that carry out grant functions. These meetings cover topics ranging from grant allowability to accurate reporting of federal finance reports. An administrative team reviews the errors and will develop an implementation plan that will address the errors by targeted education for staff and providers. Audit errors may also inform the need to may system changes to technology. b. How the Lead Agency measures and tracks results of their fiscal management practices. Describe: DHHS has a Statewide Single Audit performed annually that assesses fiscal management practices and allowable use of Federal Funding as governed by both state regulations and applicable federal regulations such as 2 CFR 200. In addition to this audit, the Agency houses an Internal Audit team that performs audits throughout the year and ensures that corrective action plans resulting from the Statewide Single Audit are performed timely. Similar reviews and audits are performed at the individual grant and program level, such as the following: -Monthly random claim line reviews on childcare program claims. -In-depth reviews of claims for providers referred for potential over-billing. -Determination and establishment of overpayments for collections of misused childcare funds. 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. 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: 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: The Lead Agency has a case review management system, Nebraska Family Online Client User System (N-FOCUS), that is used to review casework conducted by eligibility operations staff to ensure that the program is being conducted correctly. Lead Agency staff conduct case reviews to review elements of eligibility for the program to ensure that every element has been done correctly. If errors are found in a case review, they must be corrected within 10 days of the case being sent back to the eligibility worker for corrections. Trends are developed and reviewed to track and risk factors for the program. With these trends, additional resources, guidance, and trainings are developed to ensure that these trends are resolved. If the risk factor continues, additional trainings and guidance will then be developed to ensure that the risk factors are mitigated for the program. Program Accuracy Specialists (PAS), Eligibility Operations Supervisors, and Program Specialists conduct the risk assessments. The CCDF Federal Aid Administrator completes a 10% audit of all subaward and contract reimbursement invoices. The administrator will cite any discrepancies and ask for expenses to be removed if they are not allowed. b. The frequency of each risk assessment. Describe: Program Accuracy Specialists (PAS), Eligibility Operations Supervisors, and Program Specialists all have monthly goals for completing subsidy case reviews. The CCDF Federal Aid Administrator completes a 10% audit of all subaward and contract reimbursement invoices. Invoices as submitted monthly, quarterly, and bi-annually, pending the award agreement. The administrator will cite any discrepancies and ask for expenses to be removed if they are not allowed. c. How the Lead Agency uses risk assessment results to inform program improvement. Describe: Trends are developed and reviewed to track any risk factors for the program. With these trends, additional resources, guidance, and trainings are developed to ensure that these trends are resolved. If the risk factor continues, additional trainings and guidance will then be developed to ensure that the risk factors are mitigated for the program. d. How the Lead Agency knows that the risk assessment processes utilized are effective. Describe: PAS, CCDF Staff, and trainers have monthly meetings discussing trends in policy questions and errors, which helps identify if additional training or policy/process tips are needed. The Lead Agency also has tools to see what documents are used the most by staff and which are used the least by staff to determine which documents hold the most important information for staff and can update the underutilized documents to ensure that staff have the resources they need. The Lead Agency works monthly reports that require corrections to be made by staff to ensure internal controls of the program. These reports are monitored to ensure the number of cases on them each month decreases, ensuring the number of errors decreases. If there is a month where there is an increase in errors on the report the Lead Agency will send out additional resources to staff to ensure they are taking the proper steps on cases. e. Other. Describe: 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: All staff members must complete new hire training for the CCDF program before working eligibility for the program. Once staff are trained in the program, they will then mentor staff who have worked the program to see the work being done and ask any questions regarding the program. Once staff begin working the Child Care Subsidy program, they receive assistance from Eligibility Operations Supervisors and Lead Workers to answer any questions regarding the program they may have and to ensure the program is being correctly implemented. ii. Describe how staff training is evaluated for effectiveness: All staff must pass an examination at the end of the training in order to work eligibility for the program. As soon as a worker starts working eligibility of the Child Care Subsidy program, they are added to the rotation of case reviews from both Program Accuracy Specialists (PAS) and their Supervisor to ensure program integrity. If there are any error trends with a worker, the Supervisor may request additional training for that worker or additional mentoring time for that worker. They can also request PAS to complete additional case reviews, or the Supervisor can complete additional case reviews. iii. Describe how the Lead Agency uses program integrity data (e.g., error rate results, risk assessment data) to inform ongoing staff training needs: The program staff meet monthly with both Program Accuracy Staff and Training staff to go over any error trends that are seen or reported to ensure that the information is accurate in the training manual and to make any necessary adjustment to training materials and resources that are distributed to staff. 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: CCDF providers receive training at their initial enrollment. They receive billing training, which goes over what is allowable to bill, how to calculate partial and full days, and how to enter billings into the portal. Providers can ask for additional training at any time. The subsidy agreement also goes over what is allowable to bill and this is reviewed annually with providers. ii. Describe how provider training is evaluated for effectiveness: Prior to subsidy renewal, the Resource Developer will spot check the provider’s billing to ensure there are any issues or concerns. If a concern is identified, the Resource Developer will review billing training at the renewal. Workers can spot check billings at any time. iii. Describe how the Lead Agency uses program integrity data (e.g., error rate results, risk assessment data) to inform ongoing provider training needs: There are a variety of reports reviewed monthly that target providers and billing. Trends identified prompt creating quick tips and refresher trainings for Resource Developers to review and take. These prompt Resource Developers to then reach out to providers throughout their subsidy enrollment and at initial enrollment and renewals to offer assistance and training. 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: The Error Rate Review is shared with the administration of the Lead Agency; it is also shared with Eligibility Operations Staff and Administration. The Lead Agency uses the information to update any resources and create new resources and reports to ensure program integrity for the errors found in the review moving forward. 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: The Audit findings are shared with the administration of the Lead Agency; it is also shared with Eligibility Operations Staff and Administration. The Lead Agency uses the information to update any resources and create new resources and reports to ensure program integrity for the errors found in the review moving forward. 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: 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. When high error rates are determined through internal controls and audits, the Lead Agency develops a corrective action plan. Most common errors identified stem from providers over billing, billing outside of their authorization, and not providing billing calendars upon request. These errors were cited in the most recent audit. Along with provider errors there were a few errors cited where the worker put the child in the wrong age categories. b. [ ] Yes. If yes, what were the indicators? How did you use the information to strengthen your internal controls?