Miss. Code. tit. 18, pt. 15, ch. 1, r. 18-15-1-1, ATTACHMENT, att. COMPLIANCE MONITORING
Statutory Reference 2605(b)(10)
Division of Monitoring (DPI)
MONITORING
The Mississippi Department of Human Services (MDHS) is required to monitor the activities of its subgrantees by following the Single Audit Act Amendments of 1996, the Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and the OMB Circular A-133 Compliance Supplement. MDHS shall monitor each project, program, subgrant, function, or activity supported by a Federal award to assure compliance with applicable Federal regulations and that performance goals are achieved.
POLICY
MDHS has established uniform monitoring policies designed to ensure that all subgrants under the jurisdiction of MDHS are administered in compliance with Federal requirements and with the terms of the subgrant agreements. Monitoring subgrants, for compliance with the applicable Federal regulations, State laws, Agency policies, and the terms of the subgrant agreements, is the responsibility of the MDHS Division of Monitoring.
Subgrant monitoring procedures may include several of the various options available. These options include: reviewing reports submitted by the subgrantee; reviewing documentation supporting expenses reported under MDHS subgrants; reviewing the subgrantee's single audit or program-specific audit results and evaluating audit findings and the subgrantee's corrective action plan; performing on-site reviews of fiscal and programmatic records and observing subgrantee operations; and/or, arranging for limited scope audits of specific compliance areas.
Planning Considerations
When determining the extent of monitoring procedures to perform, MDHS will consider factors such as the amount of the subgrant, the percentage of a Federal program's total funds awarded to subgrantees, and the complexity of the compliance requirements. To determine the appropriateness of monitoring procedures, MDHS will consider the cost-effectiveness of monitoring procedures compared to the relative size and complexity of the Federal awards administered by the subgrantee. The following factors will also be considered when determining the monitoring procedures to be performed to ensure compliance with the Federal regulations, State laws, Agency policies and procedures, and the terms of the subgrant agreement:
Monitoring Procedures
Subgrants may be monitored by reviewing reports submitted by the subgrantee for compliance with the subgrant agreement and program instructions. For example, the monthly reporting worksheets may be reviewed for accuracy and completeness or the quarterly programmatic report may be reviewed to ensure that each element of the Scope of Services is being met.
Subgrants may be monitored by performing a desk review of supporting documentation for expenditures reported under the subgrant. This review consists of contacting the subgrantee and requesting documents to support certain amounts included on the subgrantee's reporting worksheets. These documents will be examined by the monitors to determine compliance with the subgrant agreement and with State and Federal regulations. The results of the desk review will be communicated in a written report to the subgrantee and to the MDHS Funding Division.
Desk reviews may be conducted at any time by staff of the MDHS, Division of Monitoring. The desk review procedure may be used in lieu of or in conjunction with an on-site fiscal review or as a follow-up to an on-site fiscal review to ensure that corrective actions have been implemented.
Fiscal monitoring through a desk review will include, at a minimum, a review of all documents to support all expenses reported for one month of the subgrant period. Documents shall be reviewed to support costs reported on the reporting worksheet submitted for the month in which the highest dollar amount of expenses was reported as of the date that the schedule letter was prepared to begin the desk review and request support documents.
When fiscal monitoring is initiated through a desk review and sufficient documents are not provided by the subgrantee/contractor to support costs reported on the reporting worksheet, the desk review shall cease, and fiscal monitoring shall be completed through an on-site review.
Fiscal monitoring shall not be performed through a desk review on the first subgrant awarded to a subgrantee. In addition, monitoring through a desk review shall be alternated with on-site reviews so that on-site fiscal monitoring is performed at least every other year.
Monitoring for programmatic compliance cannot be performed through a desk review.
Subgrantees that expend $500,000.00 or more of Federal financial assistance during the subgrantee" s fiscal year shall have an audit performed by an independent Certified Public Accountant in accordance with the Single Audit Act and OMB Circular A-133. As a part of MDHS" monitoring of each of its subgrants, these independent auditor's reports shall be obtained from the subgrantees and reviewed for compliance with Federal regulations.
Any audit findings identified in the independent auditor ' s reports, as well as the subgrantees proposed corrective action plans, shall be evaluated by the MDHS Funding Divisions. If the subgrantee's corrective action plan is acceptable, a management decision will be issued by the MDHS Funding Division to resolve the audit findings. The MDHS Division of Monitoring will follow-up on the subgrantee's corrective action plan during the next on-site fiscal review that is conducted.
On-site reviews for program compliance are required to be conducted at least once during the subgrant period for every MDHS subgrant. On-site reviews for program compliance may be performed on any subgrant at any time and may be repeated as often as deemed necessary by MDHS. These reviews for program compliance will be conducted by the MDHS Division of Monitoring.
The on-site programmatic reviews are formal in nature and are normally preceded by written notification to the subgrantee and to the appropriate MDHS Funding Division Directors. However, unannounced on-site programmatic reviews may also be conducted. On-site entrance and exit conferences will be conducted with subgrantee officials and a written report will be issued communicating the results of the review to the subgrantee and to the MDHS Funding Divisions. The Agency shall follow-up on the subgrantee's corrective action plan for any programmatic monitoring findings.
On-site reviews for fiscal compliance will be conducted by the Division of Monitoring, as provided under this section. These visits may also be conducted at the request of the MDHS Executive Director or the MDHS Funding Division Director.
These reviews are formal in nature and are normally preceded by written notification to the subgrantee. The appropriate Funding Division Directors shall also receive written notification of on-site fiscal reviews. However, unannounced on-site fiscal reviews may also be conducted. On-site entrance conferences will be conducted with subgrantee officials. Exit conferences will be conducted and a written report will be issued communicating the results of the review to the subgrantee and to the MDHS Funding Divisions. MDHS shall follow-up on the subgrantee's corrective action plan for any fiscal monitoring findings.
The Agency may engage an independent Certified Public Accountant to perform a Limited Scope Audit of certain MDHS subgrants. The need for this type of review shall be determined on an individual basis and shall be documented by the Division of Monitoring. The results of this review shall be communicated to the subgrantee and to the MDHS Funding Divisions in a written report.
Corrective Action Process
The Initial Report of Findings and Recommendations that is forwarded to the subgrantee and to the MDHS funding division shall require a written response from the subgrantee within fifteen (15) working days. Upon receipt of the response from the subgrantee, the Director of the Division of Monitoring and other appropriate staff shall assess each response for adequacy. If all responses are adequate, a letter will be issued to the subgrantee clearing all findings. If any responses do not adequately address the findings, the subgrantee will be notified in writing by the issuance of a Status Report acceptable to MDHS requiring a second response from the subgrantee within ten (10) working days.
If the subgrantee fails to satisfactorily resolve all of the monitoring findings, the Division of Monitoring will issue a Final Notice Letter to the subgrantee demanding that the subgrantee refund the amount of questioned costs and advising the subgrantee of the procedures to follow if they wish to request an administrative hearing with the MDHS Executive Director.
If the subgrantee does not respond to the Final Notice Letter, the subgrantee will be referred to the State of Mississippi Office of the Attorney General to recover the unresolved questioned costs, and the Agency may begin procedures for debarment and suspension against the subgrantee organization and the subgrantee authorized official.
Discovery of Possible Fraud, Mismanagement, or Program Abuse
In the event indications of possible fraud, mismanagement, or program abuse are discovered during the course of monitoring subgrants, the Director of the Division of Monitoring shall notify the Chief Compliance Officer, who shall notify the MDHS Inspector General. The MDHS Inspector General and appropriate personnel will decide the course of action to be taken, including the degree of disclosure to subgrantee personnel and to the MDHS Funding Divisions. The format for reporting such incidents will be determined by the Chief Compliance Officer and/or the MDHS Inspector General.
Division of Community Services (DCS)
Statutory Reference 2605(b)(10)
TRAINING AND TECHNICAL ASSISTANCE (T&TA)
DCS staff uses several tools and checklists to conduct an overall comprehensive review of the agencies' operations. Throughout both the programmatic and fiscal review process there should be ongoing, open communication with the staff to facilitate clarification of facts and prevent misunderstandings, provide the reviewer with a full understanding of the agencies' operations, and provide the agency with a full understanding of the review process.
Preliminary areas of noncompliance should be summarized and discussed with the Executive Director and/or designated staff during the exit conference. Copies of specific documents, supporting schedules, and reports obtained during the site visit to facilitate preparation of the report should be discussed during the exit conference. The agency is given the opportunity to provide comments and present additional information or explanation regarding a specific finding before it is included in the report.
The report should include specific timelines for any required corrective action associated with each finding. Copies of the report should be mailed to agency's Board and the agency's Executive Director. A copy should also be provided to the DCS Program Director and Compliance Officer.
The agency is required to respond in writing to each of the findings and observations mentioned in the report, including a detailed plan for taking corrective actions and implementing required changes. The initial response is due within 30 days from the date of the report. The agency's plan for resolution and corrective action will be reviewed by Compliance Team to ensure that all findings have been adequately addressed.
In the event an agency is unable or unwilling to correct a specified area of noncompliance within the prescribed timeline, DCS will report the deficiency to MDHS-Inspector General. If MDHS determines that the agency remains noncompliance in a specified area, DCS may contact DHHS to initiate proceedings to terminate the organization's designation as a Community Action Agency.
Division of Community Services (DCS)
Statutory Reference 2605(b)(10)
FEDERAL (SINGLE) AUDIT MANAGEMENT LETTER
Miss. Code. tit. 18, pt. 15, ch. 1, r. 18-15-1-1, ATTACHMENT, att. COMPLIANCE MONITORING