Department of Family and Support Services Grant Monitoring Audit

Executive Summary

The purpose of the audit was to review, test, and evaluate the grant management function at DFSS to determine whether grants were properly monitored and related procedures were effective and in compliance with grant regulations.

Based upon the results of our audit, we determined that DFSS’s grant monitoring processes were generally effective. However, we found deficiencies in some fiscal monitoring practices.

One of our more significant findings stemmed from DFSS management not fully understanding the internal control of segregation of duties. DFSS management did not believe that there was a segregation of duties issue when one employee at a delegate agency was simultaneously responsible for preparing bank deposits, reconciling bank accounts, making the deposits, and safeguarding the agency’s checks. This delegate agency employee was later convicted of felony financial crimes, theft, and forgery charges for stealing more than $60,000 by writing more than 150 checks to himself.

The other deficiencies noted during the audit related to insufficient management oversight, a misunderstanding of governmental auditing reporting standards, and ineffective grant closeout procedures.