0 | Unannounced Audit of Petty Cash and Change Funds February 2016 111 Karen E. Rushing Clerk of the Circuit Court and County Comptroller Office of the Inspector General Sarasota County, Florida Audit Of Contracted Human Services August 2024
1 | Audit of Contracted Human Services August 2024 Contents Executive Summary 2 Background and Objectives 3 Opportunities for Improvement and Management Responses 6 Audit Services Jeffrey Lilley, CPA, CIG Director of Internal Audit and Inspector General Auditor Fiorella Salazar-Vega, CIGA Internal Auditor/Investigator Auditor Blake Withee Internal Auditor/Investigator Please address inquiries regarding this report to Jeffrey Lilley, by e-mail at jlilley@sarasotaclerkandcomptroller.com or by telephone at (941) 650-0948. This and other reports prepared by the Office of the Inspector General are available at http://www.sarasotaclerk.com/inspector-general/inspector-general-audit-reports.
2 | Audit of Contracted Human Services August 2024 Executive Summary As part of the Annual Audit Plan, the Clerk of Circuit Court and County Comptroller’s Internal Audit Department and Office of the Inspector General conducted an independent audit of Contracted Human Services. The purpose of the audit was to assess whether contract eligibility for agencies participating in the program was maintained and properly monitored and to ensure that payment requests comply with the stipulations within the contract. The audit revealed key findings that underscore areas where current controls and processes could be strengthened to ensure better compliance and oversight. Agencies often failed to notify the County in writing prior to accepting additional funding, as required, which could prevent the County from adjusting its funding obligations. Moreover, many agencies did not complete their external audits within the stipulated 150-day period after the fiscal year. Issues were also identified in the accuracy and completeness of the Community Success Factor (CSF) reports regarding alternate funding. Additionally, deficiencies were identified in the timely submission of required reports and inadequate documentation for reimbursement payments. Furthermore, there were inconsistencies in the Annual Monitoring Reports, including discrepancies in insurance requirements and failures to verify and document residency status for reimbursements. During the course of the audit, opportunities to implement strategies to improve the timeliness of report submissions and more clearly identify the submission of data and statistics to the contracts agreed upon between the County and the agencies were discussed. These findings highlight areas where the current controls and processes could be improved to ensure better compliance and oversight.
3 | Audit of Contracted Human Services August 2024 Background and ObjectiveS The Clerk of the Circuit Court and County Comptroller’s Internal Audit Department and Office of the Inspector General has completed an audit of Contracted Human Services. The audit was planned and conducted in conformance with the International Standards for the Professional Practice of Internal Auditing (Standards). Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives. The purpose of the audit was to review compliance with the eligibility requirements within the Contracted Human Services contract as well as the reimbursement payment requirements. Background Sarasota County Health and Human Services’ mission is to facilitate partnerships, set priorities, leverage community resources, establish coordinating structures and secure funding sources to create integrated human services delivery systems that meet the needs of the citizens. One of these programs, Contracted Human Services, provides funding to nonprofit entities providing services that are critical and strategically effective to the well-being of the community. Each year Health and Human Services accepts applications from various nonprofit agencies. These agencies undergo a review process to determine the merits of each organization. The Contracted Human Services advisory council recommends allocations of funding to subsidize services that are: identified as being most essential or valuable to the well-being of the community and prioritized as being most critical or strategically effective to the welfare of the community. Each agency submits an application for review with Contracted Human Services and must meet certain minimum standards of eligibility such as: • Be recognized by the Internal Revenue Service as a 501(c)3 nonprofit status. • The portion of the program or service to be County funded must be provided exclusively to Sarasota County Residents. • The provider must demonstrate their capability for responsible administration and accountability of public funds.
4 | Audit of Contracted Human Services August 2024 • Be able to demonstrate and document community programming and activities for the prior calendar year. • Have independently audited financial statements. • Maintain an administrative and fundraising rate of less than 25% of total revenue. If an agency is accepted as part of the Contracted Human Services program, they sign a contract with the County that outlines the rate of funding, the total amount that will be funded, and which programs will be eligible for the funding. In order to receive reimbursement funding, each agency is required to submit invoices to the County containing the amount requested and the relevant supporting documentation. The payment requests must be submitted on either a monthly or quarterly basis (agency preference). In addition to the above, as an ongoing review process, each agency must also submit quarterly performance reports. The reports must document and outline the effectiveness of the program being funded. For fiscal year 2023, a total of $12,993,292 was budgeted to be reimbursed for Contracted Human Services provided by 57 nonprofit agencies. The level of detail required to acquire, review and maintain such an abundance of material is extraordinary. The support and time provided by those who contribute their services to the Contracted Human Services program was most appreciated. Objectives, Scope and Methodology The objective of this audit was to determine if the Health and Human Services Department’s internal controls related to Contracted Human Services are operating effectively to ensure compliance with the contracts executed for fiscal year 2023. The scope of the audit was for the period October 1, 2022 through September 30, 2023. The methodology used to meet the objective of the audit and the procedures performed included, but were not limited to, the following: • Obtained a general understanding of the process by which agencies apply for funding. • Selected a stratified sample of 29 of the 57 ($10,872,797 of $12,993,292) agencies for testing. For agencies funded monthly, the three most recent months were tested. For those funded quarterly, the most recent quarter was reviewed. • Reviewed the contract eligibility requirements for the selected sample to ensure that all agencies are in compliance with the following provisions: o The entity must be registered as a nonprofit with the State of Florida. o Financial statements and revenues are submitted each reporting period. o Program performance reports are submitted quarterly. o The certificate of insurance is maintained and includes the appropriate coverage.
5 | Audit of Contracted Human Services August 2024 o Prior and current year external audits were performed, submitted on time and are on file. • Reviewed whether agencies receiving additional funding notified the County in writing before acceptance, including statements on how the funding changes affected service provision and the continued need for County funds, ensuring that the County is informed and can assess the impact of these changes. • Reviewed whether agencies met the reporting requirements as stated in the contract in a timely manner, ensuring compliance and providing the County with timely and accurate information for effective oversight and decision-making. • Reviewed whether agencies properly documented, reviewed, and approved Annual Monitoring Reports as required by the contract, ensuring comprehensive oversight and accurate reporting for County assessments and decision-making. • Reviewed whether invoices were paid in accordance with contract guidelines and verified that the payment request forms submitted by the agency included all relevant supporting documentation to ensure compliance with contractual obligations. • Reviewed payment requests for the selected sample to ensure compliance with contract guidelines and verified that agency-submitted payment request forms included all required supporting documentation, ensuring adherence to contractual obligations. • Identified opportunities for improvement.
6 | Audit of Contracted Human Services August 2024 Opportunities For Improvement and Management Responses The audit disclosed certain policies, procedures, and/or practices that could be improved. The audit was neither designed nor intended to be a detailed study of every relevant system, procedure, or transaction. As a result of the audit, observations and recommendations identified below are related to Standards: International Professional Practice Framework Standards (2017) • (Standard 2110) Communicating risk and control information to appropriate areas of the organization, and • (Standard 2130.A1) The effectiveness of controls related to operations and programs, reliability and integrity of financial and operational information, safeguarding of assets and compliance with laws, regulations, policies, procedures, and contracts. Global Internal Audit Standards (2024) • (Standard 9.1) Communicates risk and control information throughout the organization. • (Standard 9.1) To understand risk management and control processes, the chief executive must consider how the organization identifies and assesses significant risks and selects appropriate control processes. This includes understanding how the organization identifies and manages the following key risk areas: Effectiveness and efficiency of operations and programs, Reliability and integrity of financial and operational information, Safeguarding of Assets and Compliance with laws and/or regulations. The Opportunities for Improvement presented in this report may not be all-inclusive of areas where improvement may be needed. There were seven Opportunities for Improvement identified as a result of the audit: 1. Notification of Additional Funding 2. Timeliness of External Audits 3. Accuracy in Reporting Alternate Funding 4. Consistency with Insurance Requirements 5. Timely Report Submissions 6. Adequate Documentation for Reimbursement Payments 7. Residency Verification in Reimbursement Requests
7 | Audit of Contracted Human Services August 2024 1. Notification of Additional Funding Observation The Sarasota County Government Human Services contractual agreement requires providers to notify the County in writing prior to accepting additional funding not listed in their budget and is from sources other than the County. This notification must include a statement detailing how the change in funding affects service provision and the use of, and continued need for, County funds. The provider acknowledges that such additional funding may reduce the County's funding obligations under this contract. The auditor tested a sample of twenty-nine (29) agencies to determine if those who received additional funding that was not listed on their budget notified the County with a statement prior to acceptance of the additional funding. Seven (7) agencies reported additional funding sources but none disclosed them to Human Services prior to acceptance. It was observed that agencies are reporting additional funding not listed on their budget on the Community Success Factor (CSF) reports after accepting the funding. Per the contract, the additional funding should not be accepted until the notification and statement detailing how the change in funding affects service provision and the use of, and continued need for County funds, has been provided to Human Services and reviewed. If agencies do not properly and timely notify the County, the County cannot reevaluate its funding obligations, potentially leading to over-funding. Recommendations To ensure compliance with contractual provisions, Human Services should enhance monitoring of agencies to verify they are disclosing additional funding sources not listed in their budget in writing before acceptance. Human Services is currently revising the language of future contracts to further mitigate occurrences of non-compliance. If agencies fail to comply, the County should reevaluate its funding commitments to those agencies and use this non-compliance in future award decisions. Management Response Contracted Human Services revised the language in the FY 25 contract regarding Notification of Alternative Funding. The contract template was provided to the auditor on July 2, 2024. The revised language is as follows: The provider hereby warrants and represents that, in an attempt to reduce its funding burden on the County, it will exert its best efforts to secure all available private, local, state, and federal funds and grants. Quarterly the Provider will notify the County in writing regarding acceptance of any additional or new funding sources other than the County. This notification shall include a statement as to how this change in funding affects service provision under this contract, as well as the use of, and continued need for County funds. The Provider acknowledges that such additional funding may reduce the County’s funding obligations under this Contract. Failure of the Provider to notify the County of additional funding may result in the Provider refunding to the County part or all of the funds provided under this Contract.
8 | Audit of Contracted Human Services August 2024 2. Timeliness of External Audits Observation The Sarasota County Government Human Services contractual agreement requires agencies to submit prior and current fiscal year audits. Specifically, copies of the required audit, including the management letter if applicable, covering the County's fiscal year must be sent to the County Human Services Manager within 150 days after the end of the provider's fiscal year. A review of current year audits submitted to Human Services revealed compliance issues with eleven (11) out of twenty-nine (29) agencies who failed to submit the required external audits within 150 days after the end of the fiscal year. This non-compliance not only contravenes contractual obligations but also undermines financial accountability and transparency within these agencies. Upon conversation with management, it was determined that several agencies have requested extensions on their audit deadlines. However, the current contracts do not include provisions for deadline extensions. Recommendation Upon notification of the issue, Human Services revised the contracts for the next fiscal year to remove the requirement for the provider to submit copies of the audit within 150 days after the end of the provider’s fiscal year. Human Services added new language to the contracts that stated that copies of the required audit, including the management letter if applicable, covering the County’s fiscal year will be sent to the County Human Services Manager within 30 days of the provider’s receipt of the audit report. Human Services should revise their Annual Monitoring Report to reflect the new contractual requirements regarding external audits. If agencies are unable to meet these updated requirements, the County should reevaluate its funding commitments to those agencies. Management Response Contracted Human Services revised the language regarding Timeliness of External Audits. The contract template was provided to the auditor on July 3, 2024. The revised language is as follows: B. Current Fiscal Year Audit: If the Provider’s total revenue exceeds SEVEN HUNDRED FIFTY THOUSAND Dollars ($750,000) per fiscal year OR the Provider is receiving County fund in excess of FIFTY THOUSAND Dollars ($50,000); a full audited financial statement is required. The audit must fully represent the financial condition of the Provider and comply with County standards in order for the County to accept the audit. Acceptance of any audit by another funding source does not constitute a determination that the audit complies with County standards for purposes of acceptance by the County. The County has the right to reject or accept the audit and the right to request additional financial information which, in the determination of the County, is needed to fully evaluate the financial condition of the Provider. In the event the Provider does not file a timely and complete audit in accordance with County standards, the
9 | Audit of Contracted Human Services August 2024 County may order an audit conducted. The cost of this audit shall either be deducted from future payments made to the Provider by the County or shall be refunded to the County by the Provider. Copies of the required audit including the management letter, if applicable covering the County’s fiscal year will be sent to the County Human Services Manager within 30 days of the Provider’s receipt of the audit report. C. Reviewed Financial Statements (“Reviews”): If the Provider’s total revenue exceeds TWO HUNDRED FIFTY THOUSAND Dollars ($250,000) per fiscal year but does not exceed SEVEN HUNDRED FIFTY THOUSAND Dollars ($750,000) per fiscal year OR the Provider is receiving County funds in excess of TWENTY FIVE THOUSAND Dollars ($25,000) but does not exceed FIFTY THOUSAND Dollars ($50,000); a reviewed financial statement is required. Copies of the required review, including the management letter if applicable, covering the County’s fiscal year will be sent to the County Human Services Manager within 30 days of the Provider’s receipt of the Reviews. D. Compiled Financial Statements with Footnote Disclosures (“Compilations”): If the Provider’s total revenue is less than TWO HUNDRED FIFTY THOUSAND Dollars ($250,000) per fiscal year AND the Provider is receiving County Funds less than TWENTY-FIVE THOUSAND Dollars ($25,000); a compiled financial statement with footnote disclosures is required. Copies of the compiled financial statements with footnote disclosures, including the management letter if applicable, covering the County’s fiscal year will be sent to the County Human Services Manager within 30 days of the Provider’s receipt of the Compilations. Contracted Human Services Annual Monitoring Report reflects contractual requirements regarding external audits. PARAGRAPH XVI: AUDIT REQUIREMENTS A copy of the agency’s most recent independent audit, review, or compilation with footnote disclosures as appropriate including management letter was provided. Agency’s fiscal year end date xx/xx/xx. Audit Received by Agency xx/xx/xx. Audit Received by Human Services (within 30 days) xx/xx/xx. Was a corrective action plan needed? ___ YES ___ NO. If yes, explain.
10 | Audit of Contracted Human Services August 2024 3. Accuracy in Reporting Alternate Funding Observation When agencies complete a Community Success Factor (CSF) report and receive additional funding not listed on their budget, they are required to specify how the funds will be used and whether they are intended for a specific program or for the agency as a whole. The auditor reviewed seven (7) agencies out of the sample that received additional funding and found that although the agencies identified a specific use of the funds, without a clear knowledge of the program, determining whether the funds are directly impacting the program the County is supporting or if the funds are being utilized agency-wide is unclear. The auditor confirmed with management that this information is not specified in any other document, and not all agencies clearly state the intended use of the funds. As a result, it is unclear from the CSF reports whether the additional funding sources not listed on their budget are directly impacting the specific program the County is funding or if the funds are for the entire agency. Recommendation To enhance clarity and accountability, Human Services should revise the Community Success Factor (CSF) report. The revised report should include a section where agencies must specify the intended use of the additional funds by checking a box for either “specific program” or “agencywide”. This change will ensure that the allocation and use of additional funds are transparent and directly aligned with the funding purposes. Management Response Changes have been made to the CSF report that align with the recommendations.
11 | Audit of Contracted Human Services August 2024 4. Consistency with Insurance Requirements Observation The insurance section of the Annual Monitoring Report specifies insurance requirements that differ from those outlined in the Sarasota County Government Human Services contracts. Specifically, the Annual Monitoring Report lists higher insurance limits of $1,000,000 each occurrence and $2,000,000 aggregate for Commercial General Liability insurance. However, the contracts stipulate lower minimum requirements of $500,000 each occurrence and $1,000,000 aggregate for the same insurance coverage. This discrepancy could inaccurately label agencies as non-compliant on the Annual Monitoring Report despite meeting the contractual insurance requirements. Recommendation Upon notification of the issue, Human Services revised the Annual Monitoring Report to match the insurance requirements specified in the contracts. This alignment will ensure that agencies are assessed for compliance based on the correct minimum insurance standards outlined in their contracts, thereby eliminating discrepancies and ensuring fair evaluation. Human Services should continue to monitor the accuracy of their Annual Monitoring Reports and update them when necessary. Management Response Contracted Human Services revised the requirements on the FY 24 monitoring tool. This document was provided to the auditor on July 3, 2024.
12 | Audit of Contracted Human Services August 2024 5. Timely Report Submissions Observation As part of the control to verify that agencies meet reporting requirements stipulated in the contract on a timely basis, the audit reviewed compliance with the following criteria: • Payment Request Form Including Financial Statement and Revenues: Agencies are required to submit the payment request form, which includes financial statements and revenues, within 15 days following the end of each month/quarter. The final payment request for the fiscal year must be submitted to the County within 7 calendar days following the end of the County's fiscal year. • Community Success Factor Performance reports: The 4th quarterly report, including client demographics, must be submitted within 7 calendar days following the end of the County's fiscal year. Based on the sample and timeframe selected for testing: • Eleven (11) out of twenty-nine (29) agencies did not submit their payment request forms (including financial statements & revenues) within the contractually required timeframe. Notably, two (2) agencies that submitted their payment request forms late were not flagged as late submissions in the system. • One (1) out of twenty-nine (29) agencies did not submit their Financial Statement and Revenues as part of the payment request form. Human services ultimately requested and received the form. • The submission dates of Community Success Factor (CSF) reports for four (4) out of twenty-nine (29) agencies were not recorded in the Master Payment Sheet, hindering verification of timely submissions. Recommendation In order to improve the timeliness and approval process of the report submission, we recommend to: • Enhance System Flags and Notifications: Develop or enhance existing systems to automatically flag late submissions of payment request forms, financial statements and CSF reports. Ensure these flags trigger alerts for timely follow-up and require agencies to provide written explanations for delays. • Strengthen Approval Process: Modify the approval process to mandate that approvers review and approve all flagged late submissions only after verifying that agencies have provided adequate written explanations for the tardiness. This process should include ensuring the inclusion of necessary documentation, such as P&L reports, within payment request forms. • Establish Clear Policies and Procedures: Develop and communicate clear policies outlining the requirements for timely submission of reports and documentation. Include
13 | Audit of Contracted Human Services August 2024 specific guidelines on the inclusion of necessary documentation within payment requests to facilitate efficient processing and compliance. • Enhance Communication and Accountability: Foster a culture of accountability by implementing regular communication channels for agencies to understand the importance of timely and complete submissions. Provide training and support on the new policies and procedures to ensure understanding and compliance. Management Response Enhance System Flags and Notifications: Contracted Human Services has a notification system in Smartsheet that flags late submissions. Staff evaluated the Smartsheet to determine why the alerts were not displayed on the agencies noted above and corrected the issue that was discovered. Staff updated the flag for those two entries. Strengthen Approval Process: Agencies do not receive compensation for services provided until they submit their payment request forms and have written approval of the contract manager indicating that services have been rendered in conformity with the contract. For those agencies that do not provide payments in a timely manner, they are moved to the bottom of the list to be paid (first in, first processed). The contract states that “the County reserves the right to refuse approval of any payment request that is not received within the time frames stated herein after the close of the applicable month or quarter.” In addition, staff contact the agencies if the payment request is late. Late payments are noted on the monitoring report as non-compliant, and a copy of the final monitoring letter is sent to the agency’s Executive Director as well as the Board Chair. Staff do not find it necessary to obtain a written explanation of tardiness. Establish Clear Policies and Procedures: Agencies receive the Payment and Performance Guide when there is an approved contract. This document provides the information in detail. The FY 2023 Payment Request and Performance Guide was provided to the auditor on March 6, 2024. In addition, the contract is clear regarding the dates of submission of required documentation to the County. Enhance Communication and Accountability: The contract is clear regarding the dates of submission of required documentation to the County. The Payment and Performance Guide provides information on expectations. New agencies that receive a contract with the County receive one-on-one training with the contract manager. Contract managers address timely submission of documentation during monitoring, and it is documented on the annual monitoring report. Contract managers work with their assigned agencies if and when a new policy or procedure is enacted.
14 | Audit of Contracted Human Services August 2024 6. Adequate Documentation for Reimbursement Payments Observation During our audit of the contract reimbursement payment process, we scrutinized the compliance of payment requests with contractual obligations. Specifically, our focus was on ensuring that agencies submitted payment request forms containing all required supporting documentation as stipulated by their contracts. Our audit uncovered recurring issues across Funds 117, 154, and 191 pertaining to the supporting documentation accompanying payment requests. Among the 29 agencies sampled, seven (7) failed to provide sufficient documentation to substantiate requested reimbursement amounts and to verify adherence to contract requirements. Key deficiencies included: • Verification of Service Providers: Agencies did not adequately substantiate that services were rendered by personnel holding the appropriate titles specified in the contract. • Detailed Service Documentation: Summary reports and time card submissions lacked the requisite detail to verify alignment with the contracted scope of services. • Program Eligibility and Assessment: Essential assessments and eligibility verifications for program participants were often absent from submitted documentation. However, upon further discussion with the auditee, it was clarified that although the payment requests do not include all the supporting documentation based on the scope of services written in the contract, they do perform an internal verification to ensure that the agencies are complying with the scope of services of the contract. As a third-party reviewer, we cannot verify if this internal verification process is effectively ensuring that agencies meet the scope of services. This indicates a disconnect between what is included in the payment request and the internal verification processes conducted. The primary risk stemming from these findings is the potential for misallocation of County funds due to insufficient verification of service delivery and compliance with contractual obligations. Without adequate documentation, there is a heightened risk of inaccuracies in reimbursement requests and improper use of public funds. Recommendation To mitigate these risks and enhance compliance, we recommend that Human Services: • Implement a Documentation Process for Internal Reviews: Introduce an additional step in the reimbursement process where internal verifications are documented comprehensively. This documentation should detail the internal review procedures and findings, enabling third-party reviewers to verify that agencies are meeting their contractual obligations.
15 | Audit of Contracted Human Services August 2024 Management Response Sarasota County funds represent a small portion of overall program budgets. Because agencies receive additional funding within the program and an agency at whole, in an effort to ensure geographic and equitable program coverage, beginning in fiscal year 2018, aggregate demographic data began to be collected that includes such information as gender, family income, race, age, and zip code of residence. Staff conduct annual on-site monitoring to verify reports. If the agency does not have the ability to download a report from an automated data system then CHS will do an on-site payment review for that payment timeframe. Supporting documentation that is routinely verified for sufficient evidence of services provided and is maintained in the CHS office includes, at a minimum, HIPPA complaint client identification for service accessed, sign-in sheets, calendar of events, date of service, county of residence, number of classes taught, days of attendance, number of meals served, number of counseling session provided, staff hours provided in contact with clients, number of shelter/mental health and substance abuse treatments beds utilized, and lists of assistive equipment for clients. Staff maintain a list of agencies who have the ability or not to provide a system generated report. If they do not have the ability to provide the system generated report, the document includes the additional information collected and date of on-site review. Contracted Human Services staff are working on a document that aligns with the recommendations that provides confirmation of the internal reviews that enables a third-party reviewer to verify that agencies are meeting their contractual obligations.
16 | Audit of Contracted Human Services August 2024 7. Residency Verification in Reimbursement Requests Observation During our audit of reimbursement requests for Funds 117, 154, and 191, we identified recurring issues related to residency verification, which impact compliance with contractual requirements. These issues primarily stem from challenges in documenting and verifying that reimbursements are solely for services provided to Sarasota County residents. A prevalent issue observed across agencies is the insufficient documentation and verification processes concerning participant residency status. Specifically, seven (7) out of the twenty-nine (29) agencies sampled encountered challenges in providing clear and adequate documentation on residency status. • Demographic reports often lacked comprehensive details or standardized formats for documenting residency status. • Agencies struggled to consistently verify and document residency status, leading to uncertainties about compliance with contractual requirements. Although the auditee performs internal quarterly monitoring of residency verification, this process is conducted internally and is not adequately documented for third-party review. Without clear and comprehensive documentation, third-party reviewers cannot reliably verify that agencies are complying with the residency requirement. This is particularly challenging when agencies have multiple programs in different counties, as it can create some ambiguity regarding the allocation of reimbursements. The primary risk stemming from these findings is the potential for misallocation of County funds due to inadequate verification of residency status. Without proper documentation and verification, there is a heightened risk of inaccuracies in reimbursement requests and improper use of public funds. Recommendation To address the identified issues and enhance compliance with residency verification requirements, we recommend that Human Services: • Implement a Documentation Process for Internal Verifications: As part of their quarterly monitoring processes, the auditee should document a checklist or similar tool that outlines the internal verification steps taken to ensure compliance with residency requirements. This checklist should be comprehensive and include specific details about the verification process for each program and county receiving services. • Ensure Third-Party Reviewability: The documented checklist should be made available for review by third-party auditors to verify that the internal verifications are being completed as described. This process will provide transparency and ensure that the internal monitoring activities are being reviewed by the appropriate parties.
17 | Audit of Contracted Human Services August 2024 Management Response Sarasota County funds represent a small portion of overall program budgets. Because agencies receive additional funding within the program and an agency at whole, in an effort to ensure geographic and equitable program coverage, beginning in fiscal year 2018, aggregate demographic data began to be collected that includes such information as gender, family income, race, age, and zip code of residence. On average, Sarasota County funding represents 11.10% of the funding for CHS funded agencies, while 91% of program clients are Sarasota County residents. Implement a Documentation Process for Internal Verification: Each quarter the agency provides a demographic report which includes zip codes of the clients served. The agencies do not utilize the same data systems, so data is provided based on their system capacity. CHS maintains a zip code Smartsheet broken out by Sarasota zip codes and “other counties” as many of the agencies service multi-counties. The Smartsheet that contains this information was shared with the auditors on July 17, 2024. During monitoring reviews, zip codes are looked at during file review and noted on the monitoring report. If a zip code is multi county (for example 34243), the USPS or property appraiser website is reviewed to verify the client resides in the Sarasota County portion of 34243. CHS will add a column in the Smartsheet that provides the percentage of county funding allocated to each program. Ensure Third-Party Reviewability: At the audit exit interview the process to document demographics/residency was discussed. The smartsheet that contains this information was shared with the auditors on July 17, 2024. Additional note: CHS is currently working with Procurement to move to comprehensive grant management software and performance measurement tool that will help simplify the grant application process and evaluation and standardize the reporting process.
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