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Tennessee Housing Development Agency 2025 LIHEAP Policy Manual for Regular and Crisis Assistance 61

The Compliance and Asset Management Division will issue the monitoring report within 30 days of the review's completion. Subgrantees are required to respond to all findings noted in the report within 30 days of its issuance. Subgrantees have the option to respond to concerns or observations noted in the report, though this is not required. A formal response is required for all findings and must be submitted in the form of a Corrective Action Plan (CAP). • Finding: Evidence of a major deficiency in program performance or material noncompliance with statutory, regulatory, or program requirements, including monetary deficiencies that must be reimbursed or refunded to THDA. • Concern: Evidence of a minor deficiency or noncompliance with program requirements. CAPs are not required for concerns. • Observation: A potential deficiency that could arise if not properly addressed. CAPs are not required for observations. Examples of findings may include: • Failure to document supervisory review of client applications. • Incorrect calculation of benefit matrix. • Inadequate documentation of Crisis Assistance Payments. • Failure to provide Crisis Assistance within the federally required 48-hour timeframe. THDA’s Internal Audit Division is responsible for fiscal monitoring, which is independent of the Compliance and Asset Management Division. This division reviews each LIHEAP invoice for allowable costs and compares expenditures to the agency’s approved budget, ensuring compliance with administrative and program expenditure caps. Subgrantees are subject to single audit requirements, and a copy of the audit report must be submitted to THDA. The Comptroller’s Office may also conduct audits, and it is expected that each subgrantee will monitor the program for integrity in both fiscal and programmatic areas. Failure to submit the required Corrective Action Plan, or failure to comply with the approved CAP, may result in: • Reduction of the subgrantee’s contract • Reallocation of funds • Termination of the contract and disqualification from future program participation If a subgrantee partner fails to perform or meet expectations, THDA reserves the right to redefine service areas for delivery. In such cases, THDA may contract with external parties