State of KansasState Government

Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. Per 2 CFR Part 170, “subaward” has the meaning given in 2 CFR 200.1 and means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) 2 CFR 200.303 requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) report, it was noted that the Kansas Division of Emergency Management (KDEM) did not timely report certain subawards to FSRS for the fiscal year. Questioned costs: None. Context: Twenty-eight subawards were selected for testing, totaling $39,668,267. Eighteen of the twenty-eight subawards (64%), totaling $39,594,211, were not submitted timely and reviewed timely prior to being submitted to FSRS as summarized below. While the reports were not filed timely, the supporting documentation that was needed to file the reports was gathered by KDEM and the filing was completed before SFYE 6/30/2025. Transactions Tested Report not timely 28 18 Dollar Amount of Tested Transactions Report not timely $39,668,267 $39,594,211 Cause: KDEM was understaffed during the current and prior fiscal years and had not fully implemented its corrective action plan from the prior year audit during SFY 2025 to ensure that the subawards were reported timely and reviewed timely prior to submitted to FSRS. Effect: Management is not in compliance with FFATA reporting requirements. Repeat Finding: Yes, Finding 2024-010. Recommendation: We recommend that KDEM continue to implement its corrective action plan from the prior year. Management should continue to enhance its procedures and internal controls to ensure that subawards are accurate, reported timely and reviewed timely to FSRS. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.332, all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information listed in 2 CFR 200.332(a)(1) at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Per 2 CFR 200.332(b), all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes required award information. A pass-through entity must provide the best available information when some of the information below is unavailable. A pass-through entity must provide the unavailable information when it is obtained. Required information includes: Subrecipient's name, Subrecipient's unique entity identifier, Federal Award Identification Number (FAIN), Federal Award Date, Subaward Period of Performance Start and End Date, Subaward Budget Period Start and End Date, Amount of Federal Funds Obligated in the subaward, Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation, Total Amount of the Federal Award committed to the subrecipient by the pass-through entity, Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA), Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity, Assistance Listings title and number, Identification of whether the Federal award is for research and development, Indirect cost rate for the Federal award (including if the de minimis rate is used. Per 2 CFR 200.303, non-federal entities receiving federal awards are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our testing of subrecipient monitoring, we noted that for certain subawards the Kansas Division of Emergency Management (KDEM) did not timely issue the subaward letter to the subrecipients, which should have been communicated within 30 days of subaward being obligated or before subaward payments were made. Questioned costs: None. Context: For eleven of twenty-eight subrecipients selected for testing, KDEM did not issue subaward letters to the subrecipient timely when the funds were approved and obligated. Further for six of the eleven subrecipients tested, KDEM did not maintain documentation from a previously utilized portal that they no longer have access to. Cause: 2 CFR 200.332(a) requires subawards to include certain required information to be communicated to subrecipients at the time of the subaward being awarded. The subawards were made prior to KDEM fully implementing their corrective action plan. For six of the transactions, KDEM no longer has access to the portal in which the subaward documentation is maintained. Effect: Failure to issue subawards timely and to include required federal award information could result in subrecipients not properly administering the federal program in accordance with federal regulations. Repeat Finding: Yes, Finding 2024-011. Recommendation: We recommend that KDEM continues to implement its corrective action plan from prior year and continue to enhance its internal controls and procedures to ensure that the subaward letter is issued to subrecipients timely to ensure all required federal award information is communicated to the subrecipient at the time of the subaward. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. Per 2 CFR Part 170, “subaward” has the meaning given in 2 CFR 200.1 and means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During the audit period, the entity did not submit required FFATA reports for certain first‑tier subawards subject to FFATA reporting requirements. As a result, required information was not reported in SAM.gov by the last day of the month following the month in which the subaward obligation occurred. Questioned costs: None. Context: Fourteen of the fourteen new subawards tested during the current year were not reported to the FSRS to comply with the Federal Funding and Accountability Act (FFATA). Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 14 14 14 14 14 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $ 651,008 $651,008 $651,008 $651,008 $651,008 Cause: The noncompliance occurred because the entity did not have adequate internal controls in place to identify federal awards and subawards subject to FFATA reporting requirements. Specifically, management did not maintain a formal process to track FFATA‑reportable awards, monitor reporting deadlines, or ensure staff responsible for grant administration were sufficiently trained on FFATA reporting requirements. Effect: As a result of this noncompliance, required FFATA information related to federal subawards was not publicly reported in a timely and complete manner, reducing transparency over the use of federal funds. Failure to comply with FFATA reporting requirements may result in increased oversight by federal awarding agencies and could impact the entity’s ability to receive future federal funding. Repeat Finding: No Recommendation: We recommend that management implement policies and procedures to ensure compliance with FFATA reporting requirements. This should include identifying all federal awards and subawards subject to FFATA, establishing a process to track reporting deadlines, and providing training to personnel responsible for grant administration to ensure FFATA reports are submitted timely and accurately in SAM.gov. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.332, all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information listed in 2 CFR 200.332(a)(1) at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: Subrecipient's name, Subrecipient's unique entity identifier, Federal Award Identification Number (FAIN), Federal Award Date, Subaward Period of Performance Start and End Date, Subaward Budget Period Start and End Date, Amount of Federal Funds Obligated in the subaward, Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation, Total Amount of the Federal Award committed to the subrecipient by the pass-through entity, Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA), Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity, Assistance Listings title and number, Identification of whether the Federal award is for research and development, Indirect cost rate for the Federal award (including if the de minimis rate is used). Per 2 CFR 200.303, non-federal entities receiving federal awards are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Per 2 CFR 200.332(f) pass-through entities must verify that every subrecipient is audited as required by Subpart F of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in 2 CFR 200.501. Per 2 CFR 200.332(e)(2), a pass-through entity must following-up and ensure that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and written confirmation from the subrecipient, highlighting the status of actions planned or taken to address Single Audit findings related to the particular subaward. Single Audit findings referenced above are those resulting from audits required under 2 CFR 200.501. Condition: Subawards issued by the Kansas Department of Health and Environment (Department) did not include all required subaward information and failed to obtain the Unique Identity ID for all subawards. The Department did not obtain the required audit information (Single Audit or another applicable audit) from its subrecipient during the audit period. Questioned costs: None. Context: Twenty-five of thirty-four subawards selected for testing, totaling $11,685,599, did not include all required federal award information. Specifically, the following was omitted: • Subrecipient’s Unique Identifier - (Twenty-five of Thirty-four subawards) • Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation – (Twenty-five of thirty-four subawards) • Identification of whether the award is research and development - (Twenty-five of Thirty-four subawards) • Indirect cost rate for federal award - (twenty-five of Thirty-four subawards) For two of the thirty-four subawards the Department failed to provide evidence that the Unique Entity ID was obtained. We were not provided with an audit report for one of the thirty-four subawards tested, totaling $680,010. Cause: The Department’s procedures were not sufficient to ensure that subawards included all required federal award information and obtain the required Unique Entity ID. Internal controls did not prevent or detect the errors. The Department did not have adequate procedures in place, or did not consistently implement existing procedures, to request, obtain, and track required subrecipient audit reports as part of its subrecipient monitoring process. Effect: Excluding the required federal award information at the time of subaward issuance could result in subrecipients not properly administering the federal programs in accordance with federal regulations. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in their Single Audit reports when all federal award information is not provided to them. Failure to obtain the subrecipient’s UEI resulted in incomplete subaward identification and increases the risk of ineffective subrecipient monitoring. Without obtaining and reviewing the subrecipient’s audit, the Department lacked reasonable assurance that audit findings, questioned costs, or instances of noncompliance affecting the subaward were identified and addressed. This increased the risk that Federal funds were not administered in accordance with applicable requirements. Repeat Finding: Yes, finding 2024-006. Recommendation: We recommend that the Department revise the subaward templates to include all required federal award information and update its procedures and internal controls to ensure that all required federal award information is included in subawards at the time of issuance. The Department should establish and implement formal subrecipient monitoring procedures to ensure required audit reports are requested, obtained, and reviewed in a timely manner. The Department should document its review of audit results and perform appropriate follow‑up on any identified deficiencies to ensure compliance with Federal requirements. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR 200.214 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR 180.300 states that an entity may determine suspension and debarment status by: (a) Checking SAM (System for Award Management) Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person 2 CFR 200.303 requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that it had performed suspension and debarment verification procedures before the start of procurement contracts. Questioned costs: None. Context: Sixty transactions were selected for testing which included twenty-five contracts and thirty-five subawards. For twenty-five of twenty-five contracts (100%), the Department was unable to provide documentation supporting when it had verified the contractors’ suspension and debarment status. The Department provided auditors with documentation that the contractors were not suspended or debarred, however, auditors were not able to verify that the status was documented prior to the start of the contracts. No exceptions were noted for the thirty-five subawards tested. Cause: The Department’s procedures and internal controls are not sufficient to ensure that it verifies and properly documents contractors’ suspension and debarment status prior to the execution of contracts. Effect: Failure to perform suspension and debarment verification procedures before the procurement of good or services could result in the payment of federal funds to contractors that are ineligible to participate in federal assistance programs. Repeat Finding: Yes, Finding 2024 - 007 Recommendation: We recommend that the Department enhances its procedures and internal controls to ensure that it verifies and maintains documentation of its contractors’ suspension and debarment status prior to the execution of all contracts. Verification can be performed by either checking SAM exclusions and maintaining documentation when the verification occurred, collecting a signed certification from the contractor prior to contract execution, or adding a clause or condition to the contract. We further recommend that documentation is readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. 2 CFR 200.303 requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that it had performed recertification surveys within the required timeframe which is used to meet the provider health and safety standards. Questioned costs: Unable to determine. Context: Out of sixty providers selected for testing, the Department was unable to provide the recertification surveys for 26 providers. As such, we were unable to ensure that those 26 providers met the prescribed health and safety standards prior to the Department making payments to those providers. These exceptions resulted in an error rate of 43%. Cause: The Department’s procedures and internal controls were not operating effectively to ensure that recertification surveys were maintained by the Department. The Department had not completed implementation of its corrective action plan from the prior year. Effect: Compliance with the prescribed health and safety standards for this program is not being met. Providers who are not meeting the health and safety standards are still able to receive payments. Repeat Finding: Yes, Finding 2024-009. Recommendation: We recommend the Department complete implementation of its corrective action plan from the prior year. We recommend the Department train all staff members to properly verify providers are meeting the prescribed health and safety standards before making payments to those providers and maintain all records of these verifications. Views of responsible officials: There is no disagreement with the audit finding. KDHE/Bureau of Facilities and Licensing (BFL) recognizes that documentation for twenty-six of the sixty providers was not provided. KDHE BFL operates as the State Survey Agency (SSA) under agreement with the Centers for Medicare and Medicaid Services pursuant to Section 1864 of the Social Security Act. Survey frequency and workload prioritization are governed by the annual CMS Mission and Priority Document (MPD), not by Medicaid payment cycles. KDHE BFL does not authorize, approve, or suspend Medicaid payments and does not function as a pre-payment verification entity. Health and safety oversight is accomplished through federally directed recertification surveys, complaint investigations, and CMS approved accreditation processes, consistent with the MPD and federal survey requirements. The MPD establishes a mandatory prioritization framework requiring SSA to complete Tier 1 and Tier 2 workload before initiating Tier 3 and Tier 4 activities. During the award period in question, the SSA allocated available survey resources in accordance with MPD directives, prioritizing Immediate Jeopardy investigations, high-priority complaints, enforcement follow-up, and other time-sensitive certification actions. Recertification surveys fall lower within lower-tier workload categories and may be deferred when higher-tier federally mandated priorities require resource allocations. The SSA’s survey scheduling decisions during the audit period were consistent with CMS directed workload prioritization requirements. During a recent internal review, the SSA identified several historical recertification surveys that remain in open status with the ASPEN/ACO system. In some instances, the surveys were completed and follow-up actions addressed; however, final administrative closure steps do not appear to have been fully finalized in the system. Other findings included revisit linkage or enforcement tracking was not fully reconciled or provider terminations or Change of Ownership (CHOW) process were not fully reconciled.

Criteria or specific requirement: Per 2 CFR 200.332, all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information listed in 2 CFR 200.332(a)(1) at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Per 2 CFR 200.332(b), all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes required award information. A pass-through entity must provide the best available information when some of the information below is unavailable. A pass-through entity must provide the unavailable information when it is obtained. Required information includes: Subrecipient's name, Subrecipient's unique entity identifier, Federal Award Identification Number (FAIN), Federal Award Date, Subaward Period of Performance Start and End Date, Subaward Budget Period Start and End Date, Amount of Federal Funds Obligated in the subaward, Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation, Total Amount of the Federal Award committed to the subrecipient by the pass-through entity, Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA), Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity, Assistance Listings title and number, Identification of whether the Federal award is for research and development, Indirect cost rate for the Federal award (including if the de minimis rate is used. Per 2 CFR 200.332(a), a pass-through entity must verify that the subrecipient is not excluded or disqualified in accordance with § 180.300. Verification methods are provided in § 180.300, which include confirming in SAM.gov that a potential subrecipient is not suspended, debarred, or otherwise excluded from receiving Federal funds. Per 2 CFR 200.303, non-federal entities receiving federal awards are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Subawards issued by the Kansas Department of Education and Kansas Department of Children and Families (Departments) did not include all required subaward information. Subawards underwent suspension and debarment verification from sam.gov but this process was not formally documented. Questioned costs: None. Context: Eleven of nineteen subawards selected for testing, totaling $991,788, did not include all required federal award information. Specifically, the following was omitted: • Federal Award Identification Number (FAIN) • Name of the Federal agency and contact information for awarding official of the pass-through entity • Assistance Listing Number; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at the time of disbursement • Identification of whether the award is research and development • In addition, for eleven of the eleven subawards tested, the Department did not maintain documentation evidencing that suspension and debarment verification was performed prior to issuing the subawards. Cause: The Department’s procedures were not sufficient to ensure that subawards included all required federal award information and that suspension and debarment verification was documented. Internal controls did not prevent or detect the errors. Effect: Excluding the required federal award information at the time of subaward issuance could result in subrecipients not properly administering the federal programs in accordance with federal regulations. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in their Single Audit reports when all federal award information is not provided to them. As a result of this condition, the federal awarding agency lacks full assurance that program funds were administered in compliance with federal requirements, including requirements related to vendor suspension and debarment. This condition limits the government’s ability to ensure proper oversight and stewardship of federal funds. Repeat Finding: No Recommendation: We recommend that the Departments develop a subaward template that includes all required federal award information and update its procedures and internal controls to ensure that all required federal award information is included in subawards at the time of issuance. We recommend that management enhance its procurement procedures to require and retain documented evidence that vendors are verified as not suspended or debarred prior to the award of contracts or payment of federal funds. Maintaining this documentation will help ensure compliance with federal requirements and support the government’s assurance that federal funds are expended only with eligible vendors. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. Per 2 CFR Part 170, “subaward” has the meaning given in 2 CFR 200.1 and means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Children and Families (Department) was unable to provide FFATA reports for various subawards. Questioned costs: None. Context: During Reporting – FFATA testing the Department was unable to provide submitted FFATA reports for four of the 12 subaward transactions tested. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 12 4 4 4 4 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $ 377,770 $377,770 $377,770 $377,770 $377,770 Cause: The Kansas Department of Children and Families (DCF) passed a portion of the award to the Kansas Department of Education (KSDE). The Kansas Department of Education (KSDE) passed the awards to other subrecipients located outside of the State of Kansas. At the time these subawards were issued, DCF was not aware that the subawards were subject to the Federal Funding Accountability and Transparency Act (FFATA) reporting requirements. As a result, DCF did not submit the required FFATA reports for the subawards passed through to these subrecipients. Effect: As a result of not submitting the required FFATA reports for subawards passed through to the Kansas Department of Education and other subrecipients located outside of the State of Kansas, the federal awarding agency did not receive complete and timely information regarding the use of federal funds. This resulted in noncompliance with FFATA reporting requirements and reduced transparency over federal subaward activity, which could limit federal oversight and monitoring of the program. Repeat Finding: No Recommendation: We recommend that the Kansas Department of Children and Families implement procedures to identify all subawards subject to Federal Funding Accountability and Transparency Act (FFATA) reporting requirements, including subawards passed through to both in‑state and out‑of‑state subrecipients. DCF should provide training to relevant staff on FFATA requirements and establish a review process to ensure required FFATA reports are submitted accurately and timely for all applicable subaward. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The entity did not have a documented control in place to evidence an independent review of the ACF‑199 TANF Data Report for accuracy and completeness prior to submission to the federal awarding agency. The report was generated from system data and submitted without documented supervisory review or approval before transmission. Questioned costs: None. Context: For two of the four ACF‑199 reports tested, the auditors were unable to obtain evidence that a documented review or approval of the report occurred prior to submission. No errors were identified in the reports tested, and the reports were system‑generated; however, the absence of documented review for a portion of the population tested indicates that the review control was not consistently applied. Cause: Management relied on the fact that the ACF‑199 report is generated from system‑based data extracts and did not implement a formalized review or approval process prior to submission. As a result, a specific control to review and approve the report before submission was not designed or documented. Effect: Without a documented pre‑submission review, there is an increased risk that errors or omissions in the ACF‑199 TANF Data Report may not be detected timely, which could result in the submission of inaccurate or incomplete information to the federal awarding agency. Repeat Finding: No Recommendation: We recommend that management design and implement a documented review and approval control over the ACF‑199 TANF Data Report prior to submission to the federal awarding agency. The control should include evidence of review to verify the accuracy and completeness of the report, such as documented supervisory sign‑off, electronic approval, or retention of review documentation. Implementing a consistent pre‑submission review process will strengthen internal controls over federal reporting and provide reasonable assurance of compliance with reporting requirements. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During test work of Activities Allowed or Unallowed & Allowable Costs/Cost Principles, one transaction was identified that lacked evidence that the transaction was reviewed. Questioned costs: None. Context: One of the forty transactions selected for testing, totaling $7,300, lacked evidence that the transaction was properly reviewed and approved. Cause: The Department was under a transition period between the legacy UI system and newly implemented system when this transaction occurred. The process of reviewing at the time had not been fully implemented within the new system. Effect: Not reviewing a transaction related to a federal expenditure increases the risk that the entity may be unaware of noncompliance with federal program requirements, such as unallowable costs or improper use of funds. This can result in questioned costs, the need to repay federal funds, or increased scrutiny from oversight agencies. Additionally, unresolved issues may affect the entity’s eligibility for future federal funding and require additional time and resources to address corrective actions, monitoring, or remediation efforts. Repeat Finding: No Recommendation: We recommend that the Department strengthen its review and monitoring procedures over federal expenditures to ensure that all transactions are appropriately reviewed for compliance with applicable federal program requirements. Management should implement controls to ensure transactions are adequately supported, reviewed in a timely manner, and documented, including supervisory review of expenditures charged to federal programs. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: During our testing of ETA – 191, Financial Status of UCFE/UCX one of the two reports tested lacked documentation that the report was reviewed prior to submission. Questioned costs: None. Context: One of the two ETA – 191, Financial Status of ECFE/UCX reports tested lacked documentation that the report was reviewed prior to submission. Cause: The Department lacked proper controls around the report to ensure that documentation was maintained to support that the report was reviewed for accuracy prior to submission. Effect: When evidence of review is not maintained, the Department lacks support that key oversight and approval controls were effectively performed. This increases the risk that errors, omissions, or noncompliance issues are not identified or addressed in a timely manner. In the absence of documented review, the Department may be unable to demonstrate compliance with internal control expectations to oversight agencies, which could result in increased scrutiny, additional monitoring requirements, or the need for corrective action. Repeat Finding: No Recommendation: We recommend that the Department formalize its review procedures by maintaining documented evidence of reviews for key reports related to federal programs. Management should establish clear documentation standards, such as reviewer sign‑off, date of review, and evidence of follow‑up on identified issues, to demonstrate that oversight controls are consistently performed. Views of responsible officials: There is no disagreement with the finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). States are required to submit periodic reporting to evaluate the performance of the state UI program. This includes the following reports: ETA 9050 – Time Lapse of All First Payments Except Workshare, ETA 9052 – Nonmonetary Determination Time Lapse Detections and the ETA 9055 – Appeals Case Aging – Lower and Higher Authority Appeals. Condition: During the audit period, the Department did not submit the ETA 9050, ETA 9052, and ETA 9055 reports accurately. Testing identified discrepancies between the data reported to the U.S. Department of Labor and the supporting underlying records, including variances within validation samples used to support reported figures. As a result, the reported information did not fully and accurately reflect program activity for the audit period. Questioned costs: None. Context: The U.S. Department of Labor requires states to submit accurate and complete Unemployment Insurance (UI) reports, including ETA 9050, ETA 9052, and ETA 9055. As part of the audit, eight ETA reports were tested, and discrepancies were identified in all eight reports tested. Cause: The condition occurred because the Department was in the process of implementing a new information system during the current year, which required the migration of historical and current‑year data. Management is continuing to identify and resolve data integrity issues associated with the system conversion, including differences within validation samples used to prepare the ETA reports. As a result, the Department is still working through data reconciliation and validation challenges related to the new system environment. Effect: As a result of the inaccurate submission of the ETA 9050, ETA 9052, and ETA 9055 reports, the U.S. Department of Labor may not have reliable information to assess the Department’s compliance with federal UI program requirements, including the timeliness and quality of nonmonetary determinations. Continued inaccuracies in required reporting could result in increased federal oversight and may impact future program evaluations or funding decisions. Repeat Finding: No Recommendation: We recommend that the Department continue efforts to strengthen controls over the preparation and review of ETA reports, including completing data reconciliation procedures related to the new system implementation. This should include validating migrated data, resolving discrepancies identified within validation samples, and implementing review procedures to ensure reported information is accurate, complete, and supported prior to submission to the U.S. Department of Labor. Views of responsible officials: There is no disagreement with the finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Kansas Department of Health and Environment (Department) submits quarterly workplan milestone progress reports; however, the reports provided are cumulative in nature and prior quarterly versions are not retained. As a result, auditors were unable to review progress and supporting information for each individual quarter, as only the most recent cumulative report was available. We were also unable to verify the dates that the quarterly performance reports were submitted. The Department prepares and submits quarterly workplan milestone progress reports and annual performance reports; however, documented evidence of supervisory or management review and approval of these reports prior to submission was not consistently maintained. As a result, the Department was unable to provide documentation demonstrating that the reports were reviewed for accuracy, completeness, or compliance with reporting requirements. Questioned costs: None. Context: During the audit, twenty-one quarterly workplan milestone progress reports were selected for testing; however, because the reports provided were cumulative and prior quarterly versions were not retained, we were able to test only four of the twenty-one reports and were unable to test the remaining twenty‑one reports. During the audit, twenty-one quarterly workplan milestone progress reports were selected for testing, and none included documentation evidencing review prior to submission. Additionally, five annual performance reports were tested; although the reports were available and appeared complete, the Department was unable to provide documentation demonstrating that they were formally reviewed prior to submission. Cause: The Department does not save or retain copies of the quarterly progress reports at the time they are submitted. Instead, reports are updated cumulatively each quarter, resulting in the loss of historical quarterly information. The Department does not have formalized procedures requiring documentation of supervisory or management review and approval for quarterly workplan milestone progress reports or annual performance reports. Although reports may be reviewed informally, the absence of standardized review and documentation procedures resulted in a lack of verifiable evidence that reports were reviewed prior to submission. Effect: Because individual quarterly reports were not retained, we were unable to verify progress, milestones, and reported information on a quarterly basis, which limits the ability to demonstrate compliance with reporting requirements and increases the risk that errors, omissions, or delays in milestone completion may not be detected timely. We were unable to verify whether the quarterly performance reports were submitted timely. Additionally, the absence of documented supervisory or management review for quarterly and annual performance reports limits the Department’s ability to demonstrate appropriate oversight and effective internal controls over performance reporting. Repeat Finding: No Recommendation: We recommend that the Department implement procedures to retain copies of each quarterly workplan milestone progress report at the time of submission. Maintaining discrete quarterly reports will improve documentation, support compliance with program requirements, and allow for effective monitoring and audit review of progress throughout the reporting period. In addition, we recommend that the Department implement formal procedures to document the review and approval of the quarterly and annual performance reports prior to submission. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: In accordance with 2 CFR §200.303, non-Federal entities must establish and maintain effective internal control over Federal awards that provides reasonable assurance that the entity is complying with Federal statutes, regulations, and the terms and conditions of Federal awards. In addition, the Adoption Assistance Title IV‑E program allows payment of nonrecurring adoption expenses on behalf of an eligible child. Program records must include adequate supporting documentation to substantiate the allowability and eligibility of such costs. Condition: During testing of eligibility requirements, it was noted that three participants out of forty tested did not have supporting documentation in their case files for nonrecurring adoption expenses paid on their behalf. Questioned costs: None. Context: The participants tested were determined to be eligible for the program; however, their case files did not contain complete documentation supporting the nonrecurring expenses component. Cause: Internal controls were not sufficient to identify and correct missing documentation for nonrecurring expenses prior to payment. Effect: Without adequate supporting documentation, nonrecurring expenses paid may have included costs that were not eligible under program requirements. Repeat Finding: No. Recommendation: We recommend that KDCF strengthen internal controls to ensure that supporting documentation for nonrecurring adoption expenses is obtained, reviewed, and retained prior to payment to mitigate the risk of noncompliance in the future. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Prior to making a student financial assistance disbursement, a school must notify students of the amount and type of Title IV funds they are expected to receive, and how and when those disbursements will be made (often referred to as an award letter or college financing plan) (34 CFR 668.165(a)(1)). Additionally, when Direct Loans are being credited to a student’s account, the institution must notify the student, or parent, in writing of (1) the date and amount of the disbursement; (2) the student’s right, or parent’s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan returned to the Department of Education (ED); and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan (a minimum of 14 or 30 days depending on confirmation process). The notification requirement for loan funds applies only if the funds are disbursed by EFT payment or master check (34 CFR 668.165). Institutions that implement an affirmative confirmation process (as described in 34 CFR 668.165 (a)(6)(i)) must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student’s account at the institution with Direct Loan. Institutions that do not implement an affirmative confirmation process must notify a student no earlier than 30 days before, but no later than seven days after, crediting the student’s account and must give the student 30 days (instead of 14) to cancel all or part of the loan. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: We identified two Direct Loan disbursements made by Fort Hays State University (FHSU or the University) in which the University did not make the required notification. Context: Of a total of eight Direct Loan disbursements tested from FHSU, there were two instances identified where the University did not make the required notifications. Upon discussion with the University, this was due to an information technology failure (see Cause section below) – as such, this impacted all disbursements going out during that time period. Questioned costs: None. Effect: The University was not in compliance with the ED’s requirements over Direct Loan notifications to students. As such, students may not have been aware of their right to cancel all or a portion of the loan. Cause: Per discussion with FHSU management, the University developed engagement plans in 2021 to automatically sent out loan disbursement notifications weekly to students via our student ERP system. In 2023, during a time when the maintenance of these engagement plans was being transitioned from Tech Services over to Student Fiscal Services staff, there was an unnoticed expiration of the scheduled engagement plan and a lapse of time when the notices were not sent to students. This oversight and error spanned from April 2023 to September 2023. At the time the expiration of the engagement plan was discovered in September 2023, it was immediately resolved and put back into place to continue sending notices and return to compliance. Repeat finding: No. Recommendation: We recommend the University implement review procedures to ensure disbursement notifications are properly functioning prior to disbursing Direct Loans. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Schools participating in the Direct Loan program are required to perform monthly Direct Loan reconciliations (34 CFR 685.300(b)(5)). Electronic Announcements Direct Loan (DL) DL-22-07 and GENERAL-22-86 explain that a school must reconcile the funds it received from the U.S. Department of Education’s grants management system, called the G5, with actual disbursement records the school submitted to the Common Origination and Disbursement (COD) System. Each month, COD sends the school a School Account Statement, which is the U.S. Department of Education’s (ED’s) official record of the school’s cash and disbursement records and identifies the difference between the net draws from G5 and the actual disbursement information reported to COD by the school. The school is required to account for any differences by reconciling ED’s records (School Account Statements) with the school’s financial and business records. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: We identified that for February 2024, Fort Hays State University (FHSU or the University) did not perform the monthly required Direct Loan reconciliation. Context: Of a total of eleven monthly Direct Loan disbursements tested, we identified one monthly selection in which FHSU did not perform the reconciliation. Questioned costs: None. Effect: The University was not in compliance with the ED’s requirements over Direct Loan reconciliation. As such, this increases the risks that there could be differences between the ED and the University’s records that were not resolved. Cause: Per discussion with FHSU management, the University was unable to process the Direct Loan reconciliation reports due to a system issue with loading files. Due to a recent ERP implementation, the University had to request a work order from a consultant outside of the University. The consultant who originally built the reporting structure was no longer available. So by the time the issue was resolved, the March reports were processed and the University could not process February. Repeat finding: No. Recommendation: We recommend the University implement procedures to ensure reconciliations are properly completed and reviewed each month. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: We noted that for the following during our testing: • Return of Title IV: When a student withdraws from an institution, the institution must calculate the amount of aid to be returned to the Department of Education (ED). The following institutions did not have an observable, auditable internal control over compliance to ensure the calculations of the amounts to be returned were accurate and timely: o Emporia State University o Kansas State University • Verification: For students selected by the ED, institutions are required to verify certain applicant information. The following institutions did not have an observable, auditable internal control over compliance to ensure the verification process was done in compliance with ED regulations: o Emporia State University Questioned costs: None Context: The institutions do not have internal controls in place to ensure compliance with certain Special Tests and Provisions, specifically 1) Return of Title IV and 2) Verification. That said, we did not identify any compliance exceptions. Cause: For Emporia State University, the absence of the above-mentioned controls was due to a reduction in the applicable workforce. For Kansas State University, the institution did not retain documentation or other observable inputs of any internal controls being performed. Effect: Noncompliance, errors, and/or fraud in the Return of Title IV and Verification processes could go undetected or not be identified in a timely manner. Repeat finding: No Recommendation: The institutions should implement observable, auditable internal controls over the Return of Title IV and Verification processes to 1) be compliant with federal regulations and 2) prevent possible instances of noncompliance, errors, and/or fraud. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: Subrecipient's name, Subrecipient's unique entity identifier, Federal Award Identification Number (FAIN), Federal Award Date, Subaward Period of Performance Start and End Date, Subaward Budget Period Start and End Date, Amount of Federal Funds Obligated in the subaward, Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation, Total Amount of the Federal Award committed to the subrecipient by the pass-through entity, Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA), Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity, Assistance Listings title and number, Identification of whether the Federal award is for research and development, Indirect cost rate for the Federal award (including if the de minimis rate is used. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Subawards issued by the Kansas Department of Health and Environment (Department) did not include all required subaward information. Questioned costs: None. Context: Fifteen of fifteen subawards selected for testing, totaling $2,661,654, did not include all required federal award information. Specifically, the following was omitted: • Assistance Listing Number and Program Title • Subrecipient’s Unique Identifier • Federal Award Identification Number (FAIN) • Identification of whether the award is research and development • Indirect cost rate for federal award Cause: The Department’s procedures were not sufficient to ensure that subawards included all required federal award information. Internal controls did not prevent or detect the errors. Effect: Excluding the required federal award information at the time of subaward issuance could result in subrecipients not properly administering the federal programs in accordance with federal regulations. There is also the potential for subrecipients to have incomplete Schedules of Expenditures of Federal Awards (SEFA) in their Single Audit reports when all federal award information is not provided to them. Repeat Finding: Yes, finding 2023-007. Recommendation: We recommend that the Department develop a subaward template that includes all required federal award information and update its procedures and internal controls to ensure that all required federal award information is included in subawards at the time of issuance. Views of responsible officials: Management disagrees with the finding. Multi-year subrecipient agreements executed prior to March 2024 did not include the Sub-Recipient Agreement Submission Form. The agreements were not re-executed after March 2024 to include the form. The audit findings should only pertain to agreements newly executed after March 2024; however, because the audit included agreements executed prior to March 2024, the audit found that information is missing. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Evidence of that the missing information from the subawards occurring prior to or the same time as the subaward being entered into was not provided.

Criteria or specific requirement: 2 CFR 200.214 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR 180.300 states that an entity may determine suspension and debarment status by: a) Checking SAM (System for Award Management) Exclusions; or b) Collecting a certification from that person; or c) Adding a clause or condition to the covered transaction with that person Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that it had performed suspension and debarment verification procedures before the start of procurement contracts for twelve contracts of a total of twenty-eight selections (43%) tested. Questioned costs: None. Context: Twenty-eight transactions were selected for testing which included fifteen contracts and thirteen subawards. For twelve of fifteen contracts (80%), the Department was unable to provide documentation supporting when it had verified the contractors’ suspension and debarment status. The Department provided auditors with documentation that the contractors were not suspended or debarred, however, auditors were not able to verify that the status was documented prior to the start of the contracts. No exceptions were noted for the thirteen subawards tested. Cause: The Department’s procedures and internal controls are not sufficient to ensure that it verifies and properly documents contractors’ suspension and debarment status prior to the execution of contracts. Effect: Failure to perform suspension and debarment verification procedures before the procurement of good or services could result in the payment of federal funds to contractors that are ineligible to participate in federal assistance programs. Repeat Finding: Yes, Finding 2023 – 008. Recommendation: We recommend that the Department enhance its procedures and internal controls to ensure that it verifies and maintains documentation of its contractors’ suspension and debarment status prior to the execution of all contracts. Verification can be performed by either checking SAM exclusions and maintaining documentation when the verification occurred, collecting a signed certification from the contractor prior to contract execution, or adding a clause or condition to the contract. We further recommend that documentation is readily available for audit. Views of responsible officials: Management disagrees with this finding. KDHE disagrees with this finding. KDHE has an established process in place which is documented in the Procurement Policies and Procedures manual that was provided as part of the audit request which shows that verification of suspension and debarment in the System for Award Management takes place prior to contractual agreements being fully executed as part of the agency’s established process. There is no requirement that KDHE is aware of that requires that the date of verification be documented. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Evidence of SAM verification occurring prior to or the same time as the contract being signed was not provided.

Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. Per 2 CFR Part 170, “subaward” has the meaning given in 2 CFR 200.1 and means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Kansas State Department of Health and Environment (Department) reported awards issued to contractors to FSRS when contractor agreements are not considered subawards and should not be reported. Questioned costs: None. Context: Two of two contractor agreements selected for testing were reported to FSRS when those awards should not have been reported. Auditors selected four subawards for testing and two contractor agreements for a total of six transactions tested. The contractor agreements were selected for testing as part of auditors’ follow-up testing related to the prior year finding. Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 6 0 0 2 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $ 778,921 $0 $0 $329,071 $0 Cause: The Department does not have procedures or controls in place to ensure that contractor agreements are not reported to FSRS in accordance with FFATA requirements. Effect: Subawards reported to FSRS incorrectly included contractor agreements which should not have been reported. Repeat Finding: Yes, finding 2023-009. Recommendation: We recommend that the Department develop procedures and internal controls to ensure that required subawards are reported accurately to FSRS and that contractor agreements are not reported to FSRS as subawards. Views of responsible officials: Management agrees with the finding.

Criteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that it had performed recertification surveys within the required timeframe which is used to meet the provider health and safety standards. Questioned costs: Unable to determine. Context: Out of sixty providers selected for testing, we noted the following exceptions: • 21 providers received payments from the State without meeting the prescribed health and safety standards. These exceptions resulted in an error rate of 35%. Cause: The Department’s procedures and internal controls were not operating effectively, which were impacted by staffing shortages and a focus on completing Tier One workload requirements, to ensure that recertification surveys were completed within the required timeframe and prior to payment being made. Effect: Compliance with the prescribed health and safety standards for this program is not being met. Providers who are not meeting the health and safety standards are still able to receive payments. Repeat Finding: Yes, Finding 2023-014. Recommendation: We recommend the State focus on ensuring the Department’s procedures and internal controls are being followed and have proper supporting documentation, and to continue to focus on training all staff members to properly verify providers are meeting the prescribed health and safety standards before making payments to those providers. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. Per 2 CFR Part 170, “subaward” has the meaning given in 2 CFR 200.1 and means an award provided by a pass-through entity to a subrecipient for the subrecipient to carry out part of a federal award received by the pass-through entity. It does not include payments to a contractor or payments to an individual that is a beneficiary of a federal program. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $25,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO. Condition: The Kansas Division of Emergency Management (Management) did not report subawards to FSRS during SFY 2024 in compliance with FSRS reporting requirements. Questioned costs: None. Context: Twenty-two subawards were selected for testing, totaling $59,050,029. The following exceptions were noted: • 21 of 22 subawards (95%), totaling $59,039,938, were not submitted timely and reviewed timely prior to being submitted to FSRS as of June 30, 2024. Transactions Tested Report not filed timely 22 21 Dollar Amount of Tested Transactions Report not filed timely $ 59,050,029 $59,039,938 Cause: Management has not fully implemented its corrective action plan from the prior year audit during SFY 2024 to ensure that the subawards were reported timely and reviewed timely prior to submitted to FSRS. Effect: Management is not in compliance with FFATA reporting requirements. Repeat Finding: Yes, Finding 2023-011. Recommendation: We recommend that Management continue to implement its corrective action plan from the prior year. Management should review and update its procedures and internal controls to ensure that subawards are accurate, reported timely and reviewed timely to FSRS. Views of responsible officials: Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.332, all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information listed in 2 CFR 200.332(a)(1) at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Per 2 CFR 200.331(b), all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes required award information. A pass-through entity must provide the best available information when some of the information below is unavailable. A pass-through entity must provide the unavailable information when it is obtained. Required information includes: Subrecipient's name, Subrecipient's unique entity identifier, Federal Award Identification Number (FAIN), Federal Award Date, Subaward Period of Performance Start and End Date, Subaward Budget Period Start and End Date, Amount of Federal Funds Obligated in the subaward, Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity, including the current financial obligation, Total Amount of the Federal Award committed to the subrecipient by the pass-through entity, Federal award project description, as required by the Federal Funding Accountability and Transparency Act (FFATA), Name of the Federal agency, pass-through entity, and contact information for awarding official of the pass-through entity, Assistance Listings title and number, Identification of whether the Federal award is for research and development, Indirect cost rate for the Federal award (including if the de minimis rate is used. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Division of Emergency Management (Management) did not issue subawards to subrecipients until after the fiscal year ended. Questioned costs: None. Context: For 22 of 22 subrecipients selected for testing, Management did not issue subawards until after the fiscal year ended. Cause: 2 CFR 200.332(a) requires subawards to include certain required information to be communicated to subrecipients at the time of the subaward being awarded. The subaward information was not communicated to subrecipients under after the fiscal year ended June 30, 2024, and should have been communicated at the time the subawards were awarded during the fiscal year subject to audit. Effect: Failure to issue subawards timely and to include required federal award information could result in subrecipients not properly administering the federal program in accordance with federal regulations. Repeat Finding: No. Recommendation: We recommend that Management reviews and enhances its internal controls and procedures to ensure that subawards are issued timely to subrecipients, and that subawards that include all required federal award information is communicated at the time of the subaward. Views of responsible officials: Management partially agrees with this finding. Although the 2023 2 CFR § 200.332 does state that the award letters should be sent at the time of the award, there needs to be some reasonableness to the interpretation of this regulation. KDEM currently has 13 open disasters with over 100 open projects and more being written. It is not reasonable to interpret that the award letters be sent on the date that the award is granted. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Evidence that the required information per 2 CFR 200.332 being provided to subrecipients at the time of the subawards was not provided.

Criteria or specific requirement: 2 CFR Part 200, Subpart F requires the pass-through entity to verify that every subrecipient is audited as required by Subpart F - Audit Requirements of this part when it is expected that the subrecipient's Federal awards expended during the respective fiscal year equaled or exceeded the threshold set forth in § 200.501 Audit requirements. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Division of Emergency Management (Management) did not track, determine or monitor the audit verification requirement for its subrecipients in a timely manner. Questioned costs: None Context: For 18 of 22 subrecipients selected for testing (82%), Management did not timely verify subrecipients were audited in accordance with Subpart F. Management did not send the annual audit letter to the subrecipients on a timely basis or provide an adequate documentation for the audit verification to verify this was conducted during the fiscal year ended June 30, 2024. Cause: Procedures and controls were not sufficient to ensure that it verified that subrecipients were audited in accordance with Subpart F timely. Effect: Without being able to verify through supporting documentation that subrecipients have obtained audits as required by Subpart F and management met the requirements in 2 CFR Part 200 Subpart F and 2 CFR 200.303,, there is an increased risk that subrecipients could be inappropriately spending and/or inaccurately tracking and reporting federal funds over multiple year periods, and these discrepancies may not be properly monitored, detected, and corrected by Management on a timely basis. Repeat Finding: No. Recommendation: We recommend that the agency review its procedures for monitoring of annual audits for subrecipients to ensure that subrecipients are audited in accordance with Subpart F timely and that supporting documentation is maintained to evidence this was done timely. We recommend that a clear timeline and tracking for this monitoring be added to the policies and procedures. Views of responsible officials: Management does not agree with this finding. Explanation of disagreement with audit finding: • KDEM manages the grant expenditures during the entire lifespan of the project. Scope of work is matched with actual expenses and validated before sending to FEMA for close-out. • KDEM’s audit tracker identifies when audit letters were sent and can be verified through email verification sent to sub-recipients. • There is no regulation stipulating what is “timely”. KDEM verifies audits annually. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Sufficient supporting evidence to demonstrate when the audit letters were sent and returned was not provided during the single audit testing process. We also did not see a detailed timeline and tracking process documented in policies and procedures to support evidence of compliance with these requirements.

Criteria or specific requirement: The state plan must provide methods and procedures to safeguard against unnecessary utilization of care and services (42 CFR Part 456). The State Medicaid Agency (SMA) must implement a statewide surveillance and utilization control program that (1) safeguards against unnecessary or inappropriate use of Medicaid services against excess payments, (2) assesses the quality of those services, and (3) provides for the control of the utilization of all services provided under the state plan per 42 CFR 456 Subparts B-I. The SMA must establish and use written criteria for evaluating the appropriateness and quality of Medicaid services. The agency must have procedures for the ongoing post-payment review, on a sample basis, of the need for, and the quality and timeliness of, Medicaid services. The SMA may conduct this review directly or may contract with an independent entity (42 CFR sections 456.5, 456.22, and 456.23). The SMA must establish and implement procedures to conduct utilization reviews including (1) Obtain an understanding of the procedures used by the SMA to conduct utilization reviews. (2) Evaluate the qualifications of the personnel conducting the reviews. Ascertain that the individuals possess the necessary skill or knowledge by considering the following: (a) professional certification, license, or specialized training; (b) the reputation and standing of licensed medical professionals in the view of peers if relevant; and (c) experience in the type of tasks to be performed. (3) Ascertain if the personnel performing the utilization review are organized sufficiently independently of other Medicaid operations to objectively perform their function. (4) Ascertain if the SMA or independent entity’s sampling plan was properly designed and executed. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that evidenced the auditors performing the Utilization Control review were qualified. Questioned costs: None. Context: From a sample of sixty providers, one auditor performing a review of the provider files did not have evidence that they were qualified to perform the review. No support was provided to ensure that the individual performing the review was qualified (via professional certification, license or training, relevant reputation, and experience). Cause: The Department’s procedures and internal controls were not operating effectively to ensure that qualified individuals were performing the Utilization Control review. Effect: Compliance with the utilization control requirements for this program were not being met. Repeat Finding: No. Recommendation: We recommend the Department conduct training of all staff members to properly verify that supporting documents evidencing the qualification of individuals performing utilization control reviews are maintained. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Institutions are required to report enrollment information, including Enrollment Status, under the Pell grant and the Direct loan programs via the National Student Loan Data System (NSLDS) (OMB No. 1845-0035, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309).The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Institutions must review, update, and certify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website which the financial aid administrator can access for the auditor. Enrollment status should be reported as full-time (F), three-quarter time (Q), half-time (H), less than half-time (L), leave of absence (A), graduated (G), withdrawn (W), deceased (D), never attended (X) and record not found (Z). Further, when considering the graduated (G) status versus the withdrawn (W) status, the NSLDS Enrollment Reporting Guide (the Guide) discusses when a student completes a program. The Guide noted that some schools may wait to assess a students’ completion of a program requirements, therefore, report a “W” when the student is no longer attending classes followed by a “G” when completion is confirmed with whatever effective date the school give the graduation date. The Guide continues to note that for a student who has graduated, schools who initially report a withdrawn status must subsequently report the student as having graduated by certifying a “G” status. Lastly, per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: We noted that for two of the students tested, the enrollment statuses reported in NSLDS were still listed as withdrawn (W) despite graduating (G). This included one student from the University of Kansas who graduated in December 2023 and one student at Fort Hays State University who graduated May 2024. In addition, we noted that some of the institutions did not have an observable, auditable internal control over the submission process at the time of testing. Questioned costs: None Context: We selected 40 students to test enrollment status and other NSLDS reporting requirements. We identified two students, one from the University of Kansas and one from Fort Hays State University, in which the enrollment statuses were not properly updated in NSLDS. In addition, we noted that four of the institutions – Fort Hays State University, Kansas State University, Pittsburgh State University, and Emporia State University did not have an observable, auditable internal control at time of testing. Cause: Per discussion with FHSU management, this was an oversight. Per discussion with KU management, the graduated status was reported to their third-party service provider responsible for updating NSLDS, but the information was not properly updated in NSLDS. Effect: The institutions were not in compliance with the requirements to properly report student enrollment data correctly to NSLDS. Repeat finding: No Recommendation: We recommend that the institutions implement procedures to ensure that enrollment statuses, particularly those who were initially marked as withdrawn but need to be moved to graduated, are reported correctly and timely. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Institutions must submit Direct Loan, Pell Grant, and TEACH Grant disbursement records to the Common Origination and Disbursement (COD) System, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164 (a), funds are considered disbursed on the date that the institution (a) credits those funds to a student’s account in the institutions general ledger or any subledger, or (b) pay those funds to a student directly. The funds are considered disbursed even if an institution uses its own funds in advance of receiving program funds from the Department of Education. Per 2 CFR 200.303, non-federal entities receiving federal awards must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: We identified one student disbursement at Fort Hays State University that was not reported to the COD within 15 days after originally being rejected by the COD system. Questioned costs: None Context: We selected 40 students to test that COD reporting was being performed timely. We identified one student at Fort Hays State University that had a disbursement on January 8, 2024, in which the COD system originally rejected the submission. Accordingly, the University should have resolved and resubmitted the information within 15 days. The University did not resubmit the information until March 6, 2024. Cause: Per discussion with management, this was due to a new ERP implementation. The new system reported certain information incorrectly to the COD, causing the initial rejection. Then, it took the University time to research various rejections and resolve each one. Effect: The University was not in compliance with the timing requirements of reporting disbursement to the COD System. Repeat finding: No. Recommendation: We recommend that the University implement procedures to ensure that student disbursements are reported to the COD on a timely basis, particularly those that are originally rejected. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 45 CFR 96.85 requires recipients to meet income eligibility thresholds for the LIHEAP program. Condition: During testing of eligibility, the following items were noted: • Two beneficiaries had income entered incorrectly, causing the benefits to be overstated. • One beneficiary had income entered incorrectly but there was no impact on the benefit. • One beneficiary’s income was not entered for consideration, which caused the beneficiary to be incorrectly labeled as eligible. Questioned costs: $ 512 (Net known questioned costs) Context: Errors were noted in 4 of the 40 beneficiaries (10 percent) tested. Cause: Internal controls did not catch the errors in the input of the income information. Effect: Ineligible participants can lead to questioned costs. Repeat Finding: No. Recommendation: We recommend that KDCF strengthen internal controls in place to mitigate this from happening in the future. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Part 170 requires subawards to be reported to the Federal Funding and Accountability Transparency Act Subaward Reporting System (FSRS). Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) report, it was noted that the one report tested was not filed timely. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 1 0 1 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 5,850,379 $ 0 $ 5,850,379 $ 0 $ 0 Questioned costs: None. Context: While the report was not filed timely, the supporting documentation that was needed to file the report was gathered by KDCF and the filing was actually completed. Cause: KDCF was understaffed during most of the fiscal year which impacted the timeliness. KDCF hired an individual to assist in getting the filings up to date, but it was too late for some reports that were already beyond the due date. Effect: Compliance with the reporting requirement for this program is not being met and the information is not being provided on the public website. Repeat Finding: Yes, Finding 2022-007 Recommendation: We recommend that KDCF continue with the process implemented during the fiscal year, which includes tracking the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Part 170 requires subawards to be reported to the Federal Funding and Accountability Transparency Act Subaward Reporting System (FSRS). Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that the reports were not filed timely or not filed at all for the fiscal year. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 8 1 8 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 6,046,626 $ 166,455 $ 6,046,626 $ 0 $ 0 Questioned costs: None. Context: While the reports were not filed timely and one report was not filed as of the audit testing date, the supporting documentation that was needed to file the reports was gathered by KDCF and the filing was actually completed. The report not filed was filed subsequent to the audit testing date. Cause: KDCF was understaffed during most of the fiscal year which impacted the timeliness. KDCF hired an individual to assist in getting the filings up to date, but it was too late for some reports that were already beyond the due date. Effect: Compliance with the reporting requirement for this program is not being met and the information is not being provided on the public website. Repeat Finding: No. Recommendation: We recommend that KDCF continue with the process implemented during the fiscal year, that includes tracking the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include timely submission to ensure the compliance of all reports submitted to the federal agency. Condition: During our testing of performance reports, we noted five out the five tested reports lacked documentation of review. Questioned costs: None. Context: Out of the five reports tested, all five reports did not have supporting documentation that reports were reviewed by an authorized official. Cause: The agency had staffing turnover during the fiscal year causing lack of evidence of review over the submitted reports. Effect: Reports not being formally reviewed could cause errors to get reported related to the program objectives. Repeat Finding: Yes, Finding 2022 - 011 Recommendation: We recommend the agency implement procedures to ensure reports are properly reviewed as well as increase training efforts on reporting requirements if there is future staffing turnover. Views of responsible officials: Management disagrees with the audit finding. There is review and final approval of these quarterly financial reports by the ELC program director prior to submission. The fiscal analyst at KDHE provides these financial reports to the ELC program manager and the ELC program director. The COVID and CORE ELC data from these reports are manually entered into ELC RedCap (for the years that correspond to this audit) and now ELC CAMP. COVID financial reports are then uploaded into GrantSolutions; the core ELC financial reports do not have to be uploaded to GrantSolutions. There is no mechanism to include a signature on these reports, but submission to ELC CAMP and GrantSolutions indicate the reports have been reviewed. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Evidence of review was not able to be provided.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward. Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient’s DUNS or UEI number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is research and development (R&D) and indirect cost rate for federal award. Condition: During our testing, we noted subrecipients had required information omitted from the sub agreements to the subrecipients including Assistance Listing Number (ALN) and title, subrecipient’s DUNS/UEI number, Federal Award Identification Number (FAIN), identification of whether the award is R&D, and indirect cost rate for federal award. Questioned costs: None. Context: Seventeen out of the seventeen subrecipients (100 percent) (with awards totaling $796,482) did not include required information in sub agreements issued to subrecipients. Cause: Lack of sufficient controls in place to ensure that subaward agreements contain all required information. Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: Yes, finding 2022 -012 Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 180.300 prohibits entities from contracting with or making subawards under “covered transactions” to parties that are suspended or debarred from doing business with the federal government. A contract for goods or services is a covered transaction if awarded as a grant or payment for specified use and if the amount of the contract is expected to equal or exceed $25,000. In order to comply with federal suspension and debarment requirements, the State can perform a search in the federal System of Award Management (SAM) website, which tracks the entities that the federal government has determined are ineligible to receive federal funding; collect a certification from the entity; or add a clause or condition to the contract. Condition: During our testing of twenty-seven covered transactions (twelve vendors and fifteen subrecipients), we noted that management was not able to provide supporting documentation for one vendor that suspension and debarment procedures were performed before the start of the procurement contract. Questioned costs: None. Context: For one of the twelve vendors tested (8.3 percent of vendors), management was not able to provide supporting documentation that suspension and debarment verification procedures were performed before the start of the procurement contract. Cause: Lack of sufficient tracking and monitoring procedures related to tracking of suspension and debarment for vendors and subrecipients. Effect: Failure to obtain the required certifications or perform verification procedures with the SAM website before the procurement of good or services could result in the payment of federal funds to vendors that are suspended or debarred from participation in federal assistance programs, which could lead to questioned costs. Repeat Finding: Yes, Finding 2022 - 014 Recommendation: We recommend the agency either obtain certifications from vendors stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on the SAM website. We recommend that the agency have proper procedures in place to ensure that all contractual documentation is maintained and able to be located. Views of responsible officials: Management disagrees with the audit finding. Verification is completed at the time the contract is signed by KDHE so the date of signature corresponds with the date of SAM verification. Auditor’s Concluding Remarks: Management’s response did not persuade the auditor to revise the finding. Evidence of SAM verification occurring prior to or the same time as the contract being signed was not provided.

Criteria or specific requirement: 2 CFR Part 170 requires subaward to be reported to the Federal Funding and Accountability Transparency Act Subaward Reporting System (FSRS). 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During testing it was discovered that management did not document the review of the submitted reports. Also, we noted that the State also has submitted FFATA Reports to FSRS for vendors when this reporting is not required for vendors. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 1 0 0 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $41,680 0 0 0 0 Questioned costs: None. Context: No evidence of review was noted for the one FFATA report tested. The agency also submitted information for vendors when it wasn’t applicable to them. Cause: Management has no documented process for review of reports and no documented process to ensure only subawards are submitted to FSRS. Effect: FFATA reports could contain errors that a review would normally identify. Also, vendor contracts can be incorrectly represented as subawards to FSRS. Repeat Finding: No Recommendation: We recommend that the agency implement controls to ensure reports are reviewed before submission and that a process is implemented to ensure only subawards are reported to FSRS. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR Part 170 requires subawards to be reported to the Federal Funding and Accountability Transparency Act Subaward Reporting System (FSRS). 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During testing, we noted that FFATA reports were not submitted timely and there was not a documented review of the submitted reports. Also, we noted that the State also has submitted FFATA Reports to FSRS for vendors when this reporting is not required for vendors. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 6 0 6 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $2,291,464 $0 $2,291,464 0 0 Questioned costs: None. Context: For six of the six FFATA reports tested (100 percent), a lack of timely submission was noted and no evidence of review was noted. The agency submitted information for vendors when it wasn’t applicable to them. Cause: Management has no documented process for the review of FFATA reports and no documented process to ensure that only subawards are submitted to FSRS. Effect: FFATA reports could contain errors that a review would normally identify. Also, vendor contracts can be incorrectly represented as subawards to FSRS. Repeat Finding: No Recommendation: We recommend that the agency implement controls to ensure reports are reviewed before submission, that a process is updated to ensure that reports are submitted timely, and that a process is implemented to ensure only subawards are reported to FSRS. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR Part 170 requires subawards be reported to the Federal Funding and Accountability Transparency Act Subaward Reporting System (FSRS). 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During testing, we noted that FFATA reports were not submitted timely, FFATA reports were not submitted at all, and there was not a documented review of the submitted reports Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 33 14 33 14 not reported 14 not reported Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $2,775,992 $961,031 $2,775,992 $961,031 Not Reported $961,031 Not Reported Questioned costs: None. Context: Thirty-three of the thirty-three FFATA reports tested (100 percent) were not submitted timely, 14 of 33 FFATA reports tested were not able to be provided, and for thirty-three of the thirty-three reports tested lacked evidence of review. Cause: Management could not obtain UEI numbers for the subawards for the reports not submitted and lacked a control process to ensure reports are submitted timely and formally reviewed. Effect: Compliance with the reporting requirement for this program is not being met and FFATA reports could contain errors that a review would normally identify. Repeat Finding: Yes, Finding 2022 - 008 Recommendation: We recommend that the agency implement controls to ensure subrecipients provide a UEI number before the subaward is entered into and implement procedures to ensure reports are submitted timely and formally reviewed. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient’s DUNS/UEI number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing Number (ALN) and name, identification of whether the award is R&D and indirect cost rate for federal award. 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: Subaward agreements with subrecipients, including Assistance Listing Number (ALN) and title, subrecipient’s DUNS/UEI number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award, were not included. Questioned costs: None. Context: Sixty out of the sixty subrecipients (100 percent) tested did not have required information in the applicable subawards. Cause: Lack of sufficient internal controls to ensure subawards include required information. Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: Yes, Finding 2022 - 009 Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR Part 200, Subpart F requires the pass-through entity to verify that subrecipients expected to be audited, met this requirement. 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: Management did not track, determine or monitor the audit verification requirement for any subrecipients. Questioned costs: None Context: Sixty out of the sixty subrecipients (100 percent) were not monitored related to the audit verification requirement. Cause: Lack of sufficient tracking and monitoring procedures related to subrecipient audit verification. Effect: Failure to verify and review subrecipient audits could result in subrecipients lacking required audits or audit findings that directly impact the program’s compliance requirements. Repeat Finding: Yes, Finding 2022 - 010 Recommendation: We recommend that the agency review its procedures for monitoring of annual audits for subrecipients. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. 2 CFR 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: From a sample of sixty providers, nine of the providers did not have a recertification survey completed within the required timeframe which is used to meet the provider health and safety standards. Questioned costs: None. Context: Nine of the sixty providers sampled received payments from the State without meeting the prescribed health and safety standards, which is an error rate of 15%. A non-statistical sampling method was used to select the sample. Cause: Due to staffing shortages and a focus on completing Tier One workload requirements, KDHE has not been able to conduct all of the recertification surveys timely. Effect: Compliance with the prescribed health and safety standards for this program is not being met. Providers who are not meeting the health and safety standards, are still able to receive payments. Repeat Finding: Yes, Finding 2022-003 Recommendation: We recommend the State train all staff members to properly verify providers are meeting the prescribed health and safety standards before making payments to those providers. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 42 CFR 435.916, redeterminations must be made for all Medicaid Beneficiaries annually. Condition: From a sample of sixty individuals, the annual redetermination process was not fully documented for three of the selections. Questioned costs: None. Context: Three of the sixty sampled individual Medicaid recipients did not have any supporting documentation on file, which is an error rate of 5.0%. A non-statistical sampling method was used to select the sample. Cause: Manual errors lead to three of the sampled individual Medicaid recipients not having reviews completed or supporting documentation available on file. For two of the samples, a redetermination had not been completed since September 2015, and due to manual edits were not identified for annual redeterminations. For one of the samples, the State was unable to locate archived documentation to support the individual Medicaid recipient?s U.S. citizenship or immigration status. Effect: Compliance with the documentation requirement for this program is not being met and presents difficulty in proving there were not improper payments made. Repeat Finding: No. Recommendation: We recommend that KDHE reviews the process of redeterminations being sent to the household and identify any problem areas in the process which could undermine the redetermination frequency. We also recommend that KDHE reviews the training materials to ensure that all staff who make eligibility determinations are aware of the required supporting documentation to be saved for both initial eligibility determinations and redeterminations. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. Condition: From a sample of sixty providers, two of the providers did not have a recertification survey completed within the required timeframe which is used to meet the provider health and safety standards. Questioned costs: None. Context: Two of the sixty providers sampled received payments from the State without meeting the prescribed health and safety standards, which is an error rate of 3.3%. A non-statistical sampling method was used to select the sample. Cause: Due to staffing shortages and a focus on completing Tier One workload requirements, KDHE has not been able to conduct all of the recertification surveys timely. Effect: Compliance with the prescribed health and safety standards for this program is not being met. Providers who are not meeting the health and safety standards, are still able to receive payments. Repeat Finding: No. Recommendation: We recommend the State train all staff members to properly verify providers are meeting the prescribed health and safety standards before making payments to those providers. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that the reports were not filed timely for the fiscal year. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 10 0 6 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 10,644,442 $ 0 $ 6,688,567 $ 0 $ 0 Questioned costs: None. Context: While the reports were not filed timely, the supporting documentation that was needed to file the reports was gathered by KDCF and the filing was actually completed. Cause: KDCF was understaffed during the fiscal year which impacted the timeliness. Effect: Compliance with the reporting requirement for this program is not being met and the information is not being provided on the public website. Repeat Finding: No. Recommendation: We recommend that KDCF implement a process that includes tracking the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Per the grant agreement, ?nonrecurring expenses of adoption may be paid on behalf of the child?. The case file should have documentation for the nonrecurring expenses. Condition: During testing of eligibility, it was noted that two participants out of the sixty tested lacked supporting documentation for non-recurring expenses paid on behalf of those participants. Questioned costs: None. Context: The participants were considered eligible for the program, however their case files were not complete for non-recurring expenses portion of the file. Cause: Internal controls did not catch the missing documentation. Effect: The non-recurring expenses that lacked documentation could have been for ineligible expenses. Repeat Finding: No. Recommendation: We recommend that DCF have internal controls in place to mitigate this from happening in the future. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 31 CFR section 19.300 requires that prior to entering into subawards and contracts with award funds, recipients must verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. Condition: The date when suspension and debarment requirements were checked and verified were not maintained or documented. One instance in which suspension and debarment check and verification did not occur. Questioned costs: None. Context: Seven of nineteen covered transactions did not have documentation related to when the verification of suspension and debarment requirements occurred. One of nineteen covered transactions did not have documentation that verification of suspension and debarment requirements occurred. Cause: Lack of internal controls to ensure properly documented and maintained suspension and debarment checks. Effect: Failure to maintain the required certifications or perform verification procedures with the SAM could result in the payment of federal funds to vendors that are suspended or debarred from participation in federal assistance programs. Noncompliance with 31 CFR section 19.300. Repeat Finding: No. Recommendation: We recommend management document when vendors are checked and verified for suspension and debarment requirements and for this to occur for all vendors. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that the reports were not filed at all for the fiscal year. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 2 2 2 2 2 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 3,246,853 $ 3,246,853 $ 3,246,853 $ 3,246,853 $ 3,246,853 Questioned costs: None. Context: While the reports were not filed, the supporting documentation that was needed to file the reports was gathered by KDCF and KHRC. Cause: Both KDCF and KHRC assumed that the other agency was going to complete this reporting. Effect: Compliance with the reporting requirement for this program is not being met and could result in a miscommunication to subrecipients as to the nature of the subaward. Repeat Finding: No. Recommendation: We recommend that KDCF and KHRC implement a process that includes ensuring the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR Part section 170 requires subaward be reported to the Federal Funding and Accounting Transparency Act Subaward Reporting System (FSRS). Condition: Management was unable to provide a listing of reports related to the Federal Funding Accounting and Transparency Act (FFATA). Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements Not able to test Unknown Unknown Unknown Unknown Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements Not able to test Unknown Unknown Unknown Unknown Questioned costs: None. Context: We were not provided a listing of reports. Cause: Management could not login into the system of record (FSRS) and reports were not saved to alternate location. Effect: Federal reporting requirements were not performed. Subrecipient awards are material to the program. Repeat Finding: No. Recommendation: We recommend that the agency implement controls to ensure routine access to FSRS and to save completed reports to a secondary location. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing number and name, identification of whether the award is R&D and indirect cost rate for federal award. Condition: Subaward agreements to the subrecipients including Assisting Listing title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award, were not included. Questioned costs: None. Context: Twenty nine out of the twenty nine subrecipients did not have required information in the applicable subawards. Cause: Lack of sufficient internal controls to ensure subawards include required information. Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: No. Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR Part 200, Subpart F requires the pass-through entity to verify that subrecipients expected to be audited, met this requirement. Condition: Management did not track, determine or monitor the audit verification requirement for any subrecipients. Questioned costs: None. Context: Twenty nine out of the twenty nine subrecipients were not monitored related to the audit verification requirement. Cause: Lack of sufficient tracking and monitoring procedures related to subrecipient audit verification. Effect: Failure to verify and review subrecipient audits could result in subrecipients lacking required audits or audit findings that directly impact the program?s compliance requirements. Repeat Finding: No. Recommendation: We recommend that the agency review its procedures for monitoring of annual audits for subrecipients. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include timely submission to ensure the compliance of all reports submitted to the federal agency. Condition: During our testing of performance reports, we noted five out the five tested reports were not submitted timely and lacked documentation of review. Questioned costs: None. Context: Out of the five reports tested, all five reports did not have supporting documentation that reports were submitted timely or reviewed by an authorized official. Cause: The agency had staffing turnover during the fiscal year causing lack of review and untimely submission. Effect: Compliance with the timeliness reporting requirement for this program was not being met. Repeat Finding: Yes, finding 2021-009. Recommendation: We recommend the agency implement procedures to ensure reports are properly reviewed and submitted in a timely manner as well as increase training efforts on reporting requirements if there is future staffing turnover. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is R&D and indirect cost rate for federal award. Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward. Condition: During our testing, we noted forty out of the forty subrecipients (with expenditures totaling $10,453,259) had required information omitted from the sub agreements to the subrecipients including Assistance Listing (CFDA) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award. Questioned costs: None. Context: Forty out of the Forty subrecipients did not include required information in sub agreements issued to subrecipients. Cause: Lack of sufficient controls in place to ensure that subaward agreements contain all required information. Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations. Repeat Finding: Yes, finding 2021-011. Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include procedures in place to ensure the required certifications for covered contracts and subawards are received, documented, and contracts are not made with a debarred or suspended party. Condition: During our testing of sixty covered transactions (thirty-six vendors and twenty-four subrecipients), we noted twenty-one vendors did not have proper supporting documentation for suspension and debarment procedures for state vendors. Questioned costs: None. Context: Twenty-one of the sixty covered transaction tested did not have proper supporting documentation for suspension and debarment procedures. Cause: Several of these vendors were previously approved under Kansas State statute and through the Kansas Department of Administration, which does not perform suspension and debarment procedures over vendors. Effect: Failure to obtain the required certifications or perform verification procedures with the SAM could result in the payment of federal funds to vendors that are suspended or debarred from participation in federal assistance programs. Repeat Finding: Yes, finding 2021-010. Recommendation: We recommend the agency obtain certifications from vendor stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on SAM. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing number and name, identification of whether the award is R&D and indirect cost rate for federal award. 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During our testing of sixty covered transactions (thirty-six vendors and twenty-four subrecipients), we noted that management was not able to provide supporting documentation for two vendors and three subrecipients. This includes suspension and debarment verification documentation and other supporting details including contract agreements. Questioned costs: None. Context: Management was not able to provide supporting documentation for two vendors and three subrecipients. Cause: Lack of sufficient tracking and monitoring procedures related to tracking of suspension and debarment for vendors and subrecipients. Effect: Failure to obtain the required certifications or perform verification procedures with the SAM could result in the payment of federal funds to vendors that are suspended or debarred from participation in federal assistance programs. Repeat Finding: No. Recommendation: We recommend the agency obtain certifications from vendor stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on SAM. We recommend that the agency have proper procedures in place to ensure that all contractual documentation is maintained and able to be located. Views of responsible officials: There is no disagreement with the audit finding.

Criteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During Benefits Accuracy Measurement (BAM) case testing, it was noted that cases were not being completed timely. 25 out 40 cases sampled were not completed within 60 days (62.50% error rate), it is required that 70 percent be completed within 60 days of the week ending date of the batch. 8 out of 40 of the sampled cases were not completed under 90 days (20.00% error rate), it is required that 95 percent of cases must be completed within 90 days of the week of date of the batch. 3 of 37 of the sampled cases were not completed within 120 days (7.50% error rate), it is required that 98 percent be completed within 120 days of the week ending date of the batch. Questioned costs: None. Context: BAM cases need to be completed at minimum of 70 percent of cases competed within 60 days of the week ending of the date of batch, 95 percent of cases completed within 90 days of the week ending date of the batch and 98 percent of cases for the year must be completed within 120 days of the ending date of calendar year. Cause: Due to COVID-19 circumstances and a rise of BAM cases to review, cases were not reviewed timely due to the amount and staffing issues. Effect: This indicates that BAM cases are not being reviewed timely, this can cause potential issues to not be appropriately and timely addressed that are looked at during BAM case reviews. Repeat Finding: No. Recommendation: We recommend that internal controls are in place to ensure that cases are reviewed within the required timeframes. Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 003Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and Environment (KDHE)Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX), COVID-19-Medical Assistance Program ? Medicaid ClusterAssistance Number: 93.775, 93.777, 93.778Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Allowable Activities, Allowable CostsType of Finding: Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement: Per 42 CFR sections 435.10, 440.210, 440.220, and 440.180, Federal financial participation (FFP) funds can be used only for Medicaid benefit payments (as specified in the state plan, federal regulations, or an approved waiver/demonstration), expenditures for administration and training, expenditures for the State Survey and Certification Program, and expenditures for the establishment and operation of state MFCUs.Condition: From a sample of sixty general disbursements, three of the samples did not have any supporting documentation on file.Questioned costs: None.Context: Three of the sixty sampled general disbursements did not have any supporting documentation on file, which is an error rate of 5.0%. A non-statistical sampling method was used to select the sample.Cause: A former Kansas Department for Aging and Disability Services (KDADS) staff member did not maintain records appropriately. This lack of maintaining records is what led to the missing documentation.Effect: Compliance with the documentation requirement for this program is not being met and presents difficulty in proving there were not improper payments made.Repeat Finding: No.Recommendation: We recommend the State train all staff members to properly record all documentation for all general disbursements.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 004Federal Agency: U.S. Department of Housing and Urban DevelopmentState Department/Agency: Kansas Department of Commerce (KDC)Federal Program: Community Development Block Grants/State?s Program and Non-entitlement Grants in HawaiiAssistance Listing Number: 14.228Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During testing of the annual Performance and Evaluation Report (PER) and the annual HUD 60002 report, Section 3 Summary Report, Economic Opportunities for Low- and Very Low-Income Persons and Federal Funding Accountability and Transparency Act reports, it was noted that the reports did not have evidence of a review being conducted other than someone preparing the reports.Questioned costs: None.Context: While the reports selected for testing were not reviewed by someone separate from the preparer of the reports, it was noted that the reports were properly supported based on the testing.Cause: Lack of segregation of duties over the preparation and review process could have contributed to this finding.Effect: The potential for data entry error or incorrect information being submitted is more prevalent when segregation of duties is not in place.Repeat Finding: No.Recommendation: We recommend that KDC implement a review process of these reports by someone within the department that does not also prepare the reports in order to have a proper internal control in place over the reporting compliance requirement.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 005Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Children and Families (KDCF)Federal Program: Adoption Assistance Title IV-EAssistance Listing Number: 93.659Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Material Weakness in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that the reports were not filed at all for the fiscal year.Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements5 5 5 5 5Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements$ 616,771 $ 616,771 $ 616,771 $ 616,771 $ 616,771Questioned costs: None.Context: While the reports were not filed, the supporting documentation that was needed to file the reports was gathered by KDCF.Cause: KDCF was uncertain how to report the subaward amount for subawards that were structured as fee-for-service contracts.Effect: Compliance with the reporting requirement for this program is not being met and could result in a miscommunication to subrecipients as to the nature of the subaward.Repeat Finding: No.Recommendation: We recommend that KDCF implement a process that includes defining how to treat fee-for-service subawards and tracking the timely submission of the FFATA reports.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 006Federal Agency: U.S. Department of TreasuryState Department/Agency: Kansas Department of CommerceFederal Program: COVID-19 Coronavirus Relief FundAssistance Listing Number: 21.019Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Subrecipient MonitoringType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CRF 200.331(d) requires nonfederal entities receiving Federal awards monitor the activities of the subrecipient as necessary to ensure the subaward is used for authorized purposes, in compliance with Federal statues, regulations and the terms and conditions of the subaward and the performance goals are achieved. Pass-through entity monitoring of the subrecipient must include: (1) reviewing financial reports and performance reports required by the pass-through entity and (2) following-up and ensuring the subrecipient takes timely and appropriate action on all deficiencies pertaining to the Federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means.2 CFR 200.303 requires that non-Federal entities receiving Federal awards establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include procedures to ensure subrecipients are being properly monitored.Condition: During our testing, we noted three of the sixty subrecipients did not have proper documentation for subrecipient monitoring.Questioned costs: None.Context: Three out of sixty subrecipients tested did not have documented subrecipient monitoring.Cause: This is a newer program which contributed to the agency not maintaining all proper documentation.Effect: Agency was not able to track expenditures related to federal award dollars to ensure that these costs were allowable.Repeat Finding: No.Recommendation: We recommend the agency review its procedures for the subrecipient monitoring process to ensure the reviews are completed.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 007Federal Agency: U.S. Department of TreasuryState Department/Agency: Kansas Department of CommerceFederal Program: COVID-19 Coronavirus Relief FundAssistance Listing Number: 21.019Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Subrecipient MonitoringType of Finding: Material Weakness in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities receiving Federal awards establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include procedures to ensure federal funds are given to eligible subrecipients.Condition: During our testing, we noted that one out of the sixty subrecipients selected for testing did not provide documentation back to the state agency for proper verification of expenditures.Questioned costs: $15,000Context: One of the sixty subrecipients did not submit a required report of expenditures after receiving federal funds.Cause: The agency attempted to contact the subrecipient to receive documentation of expenditures leading them to determine the subrecipient to be a possible ineligible entity.Effect: Failure to have proper review of applicants may result in ineligible subrecipients receiving funds for which they are not eligible.Repeat Finding: No.Recommendation: We recommend the agency review procedures to ensure that subrecipients are eligible before receiving federal funds.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 008Federal Agency: U.S. Department of TreasuryState Department/Agency: Kansas Department of CommerceFederal Program: COVID-19 Coronavirus Relief FundAssistance Listing Number: 21.019Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Subrecipient MonitoringType of Finding: Material Weakness in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, CFDA number and name, identification of whether the award is R&D and indirect cost rate for federal award.2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward.Condition: During our testing, we noted fifty-nine out of the sixty subrecipients (with expenditures totaling $91,224,098) had required information omitted from the sub agreements to the subrecipients including Assistance Listing (ALN) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award.Questioned costs: None.Context: Fifty-nine of the sixty subrecipients did not include required information in sub agreements issued to subrecipients.Cause: This is a newer program which contributed to the agency not constructing the proper subrecipient award documentation.Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations.Repeat Finding: No.Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 009Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and EnvironmentFederal Program: COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number: 93.323Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include timely submission to ensure the compliance of all reports submitted to the federal agency.Condition: During our testing of performance reports, we noted five of the five tested reports were not submitted timely and lacked documentation of review.Questioned costs: None.Context: Out of the five reports tested, all five reports did not have supporting documentation that reports were submitted timely or reviewed by an authorized official.Cause: The agency had staffing turnover during the fiscal year causing lack of review and untimely submission.Effect: Compliance with the timeliness reporting requirement for this program was not being met.Repeat Finding: No.Recommendation: We recommend the agency implement procedures to ensure reports are properly reviewed and submitted in a timely manner as well as increase training efforts on reporting requirements if there is future staffing turnover.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 010Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and EnvironmentFederal Program: COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number: 93.323Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Suspension and DebarmentType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include procedures in place to ensure the required certifications for covered contracts and subawards are received, documented, and contracts are not made with a debarred or suspended party.Condition: During our testing of eighteen covered transactions (eleven vendors and seven subrecipients), we noted ten vendors did not have proper supporting documentation for suspension and debarment procedures for state vendors.Questioned costs: None.Context: Ten of the eighteen covered transactions tested did not have proper supporting documentation for suspension and debarment procedures.Cause: Several of these vendors were previously approved under Kansas State statute and three of them were entered into through the Kansas Department of Administration which does not perform suspension and debarment procedures.Effect: Failure to obtain the required certifications or perform verification procedures with the SAM could result in the payment of federal funds to vendors that are suspended or debarred from participation in federal assistance programs.Repeat Finding: No.Recommendation: We recommend the agency obtain certifications from vendors stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on SAM.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 011Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and EnvironmentFederal Program: COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC)Assistance Listing Number: 93.323Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Subrecipient MonitoringType of Finding: Material Weakness in Internal Control Over Compliance, Other MattersCriteria or specific requirement: Per 2 CFR 200.331(a) states that all pass-through entities must ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes, federal award identification, subrecipient name, subrecipient?s DUNS number, federal award identification number (FAIN), federal award date, subaward start and end date, amount of federal funds obligated, total amount of federal award, federal award project description, name of federal awarding agency, Assistance Listing (CFDA) number and name, identification of whether the award is R&D and indirect cost rate for federal award.Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal control should include procedures to ensure required information is communicated prior to the issuance of the subaward.Condition: During our testing, we noted eleven of the eleven subrecipients (with expenditures totaling $1,696,447) had required information omitted from the sub agreements to the subrecipients including Assistance Listing (CFDA) title and number, subrecipient?s DUNS number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award.Questioned costs: None.Context: Eleven of the eleven subrecipients did not include required information in sub agreements issued to subrecipients.Cause: This is a newer program which contributed to the agency not constructing the proper subrecipient award documentation.Effect: Failure to communicate required information could result in subrecipients not properly administering the federal programs in accordance with federal regulations.Repeat Finding: No.Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 012Federal Agency: U.S. Department of EducationState Department/Agency: Kansas State Department of Education (KSDE)Federal Program: COVID-19 Education Stabilization FundAssistance Listing Number: 84.425DAward Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: Per 2 CFR 200.303, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. Effective internal controls should include timely submission to ensure the compliance of all reports submitted to the federal agency.Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that thirty out of the thirty-four tested reports were submitted outside of the required timeline.Transactions Tested Subaward Not Reported Reports Not Timely Subaward Amount Incorrect Subaward Missing Key Elements34 0 30 0 0Dollar Amount of Tested Transactions Subaward Not Reported Dollar Amount of Reports Not Timely Subaward Amount Incorrect Subaward Missing Key Elements$ 44,006,531 $0 $30,143,038 $ 0 $ 0Questioned costs: None.Context: FFATA reports are required to be submitted by the end of the following month in which the prime recipient awards any sub-grants equal to or greater than $30,000.Cause: Due to the agency having changing work conditions caused by the pandemic as well as a new federal program running, the FFATA submission was delayed.Effect: Compliance with the reporting requirement for this program is not being met and could result in a miscommunication to subrecipients as to the nature of the subaward.Repeat Finding: No.Recommendation: We recommend the agency implement a process that includes tracking timely submission of the FFATA reports.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 013Federal Agency: Department of Homeland SecurityState Department/Agency: Kansas Department of Labor (KDOL)Federal Program: COVID-19 Presidential Declared Disaster Assistance to Individuals and Households - Other NeedsAssistance Listing Number: 97.050Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Material Weakness in Internal Control Over Compliance, Material Non-ComplianceCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Per the grant agreement agencies using federal funding under the program are required to submit Weekly program status reports as required in addition to final reports as required by 2 C.F.R. Part 200.328. Program status reports must include:- The number and dollar amount of applications approved weekly;- The number of individuals eligible to receive assistance under this award, broken out by the programs identified in Section 4(d)(i) of the August 8, 2020 Presidential memorandum;- The amount of assistance disbursed weekly; and- The number of appeals received.Condition: During reporting testing it was noted that twenty-five out of the thirty-nine required Lost Wage Benefit Payments Reports in fiscal year 2021 were not filled out and completed.Questioned costs: None.Context: We were not able to obtain supporting documentation that reports were completed throughout the fiscal year.Cause: The agency noted that a problem with IT caused the reports to not be filled out and completed during the year.Effect: Federal reporting requirements were not performed.Repeat Finding: No.Recommendation: We recommend that the agency put into place controls to ensure all reports are prepared, reviewed, and submitted timely.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 014Federal Agency: Department of Homeland SecurityState Department/Agency: Kansas Department of Labor (KDOL)Federal Program: COVID-19 Presidential Declared Disaster Assistance to Individuals and Households - Other NeedsAssistance Listing Number: 97.050Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: ReportingType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During testing of Lost Wage Payment reports for proper internal controls around the submission and reviewal of reports it was noted that reports do not contain any formal indication of review, including a signature or initials from the reviewing employee.Questioned costs: None.Context: During testing it was noted that eight out of the ten tested Lost Wage Benefit Payment Reports did not contain proper documentation support that reports were reviewed prior to and after submission.Cause: The Department?s internal controls are not designed to require evidence is retained to support review and approval was performed.Effect: We were not able to ensure reports were reviewed, this could indicate that reports contained errors.Repeat Finding: No.Recommendation: We recommend that the agency implement internal controls that have the reviewer initial or sign off on the reports after they have been reviewed and submitted.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 015Federal Agency: Department of Homeland SecurityState Department/Agency: Kansas Department of Labor (KDOL)Federal Program: COVID-19 Presidential Declared Disaster Assistance to Individuals and Households - Other NeedsAssistance Listing Number: 97.050Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Per Grant Agreement ?Assistance from FEMA for providing supplemental payments for lost wages to eligible individuals under this program is limited to:a. A $300 payment per week to individuals eligible for assistance; andb. May not extend beyond:i. The week ending December 27, 2020; orii. The effective date enactment of legislation providing, due to the COVID-19 outbreak, supplemental Federal unemployment compensation, or similar compensation, for unemployed or underemployed individuals.c. Additional funds will not be made available when the balance of the Disaster Relief Fund reaches $25 billion; ord. When FEMA has expended $44 billion on this program from the DRF, whichever is first.Condition: During testing of eligibility, it was noted that three out of the sixty tested claimants received overpayments.Questioned costs: $4,200.Context: CLA tested claimants? eligibility for amount of dollars received and noted multiple individuals received more than the allowed $300 supplemental payment.Cause: The Department?s internal controls were not properly designed to catch the errors or overpayments after initial submissions of a claimant?s payments.Effect: Agency overpaid claimants with federal awarding dollars, this could indicate that more individuals were overpaid throughout the population.Repeat Finding: No.Recommendation: We recommend the agency implement internal controls in place to mitigate the potential of this occurring again in the future.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 016Federal Agency: Department of Homeland SecurityState Department/Agency: Kansas Department of Labor (KDOL)Federal Program: COVID-19 Presidential Declared Disaster Assistance to Individuals and Households - Other NeedsAssistance Listing Number: 97.050Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Per grant agreement ?Eligible individuals? means: a. Recipients of at least $100 per week for any of the following benefits, beginning back to August 1, 2020:i. Unemployment compensation, including Unemployment Compensation for Federal Employees (UCFE) and Unemployment Compensation for Ex- Service members (UCX);ii. Pandemic Emergency Unemployment Compensation (PEUC);iii. Pandemic Unemployment Assistance (PUA);iv. Extended Benefits (EB);v. Short-Time Compensation (STC);vi. Trade Readjustment Allowance (TRA); andvii. Payments under the Self-Employment Assistance (SEA) program; andb. Persons who provide self-certification that the eligible individual is unemployed, partially unemployed, or unable or unavailable to work due to disruptions caused by COVID-19.Condition: During testing of eligibility, it was noted that one claimant out of the sixty tested received LWAP funds for child support payments, payments per grant agreement are strictly for lost wages.Questioned costs: $300.Context: We tested claimants? eligibility for amount of dollars received from other benefits.Cause: Internal controls did not catch the error in payments.Effect: Claimant received funds for an ineligible use of the awarded federal dollars, this could have occurred multiple times throughout the population.Repeat Finding: No.Recommendation: We recommend the agency have internal controls in place to mitigate this.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 017Federal Agency: Department of Homeland SecurityState Department/Agency: Kansas Department of Labor (KDOL)Federal Program: COVID-19 Presidential Declared Disaster Assistance to Individuals and Households - Other NeedsAssistance Listing Number: 97.050Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Per grant agreement ?Eligible individuals? means: a. Recipients of at least $100 per week for any of the following benefits, beginning back to August 1, 2020:i. Unemployment compensation, including Unemployment Compensation for Federal Employees (UCFE) and Unemployment Compensation for Ex- Service members (UCX);ii. Pandemic Emergency Unemployment Compensation (PEUC);iii. Pandemic Unemployment Assistance (PUA);iv. Extended Benefits (EB);v. Short-Time Compensation (STC);vi. Trade Readjustment Allowance (TRA); andvii. Payments under the Self-Employment Assistance (SEA) program; andb. Persons who provide self-certification that the eligible individual is unemployed, partially unemployed, or unable or unavailable to work due to disruptions caused by COVID-19.Condition: During Lost Wage Assistance Payments testing it was noted that five claimants out of sixty tested did not have documentation that self-certification forms completed.Questioned costs: None.Context: We tested this as a part of internal control to ensure self-certification forms were reviewed before payments were sent to claimants.Cause: Agency did not maintain or receive these initially before approving payments to claimants.Effect: Claimant received funds for an ineligible use of the awarded federal dollars, this could have occurred multiple times throughout the population.Repeat Finding: No.Recommendation: We recommend the agency design internal controls to ensure all applicants complete a self-certification form prior to payment and procedures are in place to review self-certification forms.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 018Federal Agency: Department of LaborState Department/Agency: Kansas Department of CommerceFederal Program: Unemployment Insurance, COVID-19 Unemployment InsuranceAssistance Listing Number: 17.225Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: Special Tests 5 ? Reemployment ProgramsType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During Reemployment Services and Eligibility Assessments (RESEA) testing, ERQ forms were reviewed as a part of internal control testing over RESEA, which require a caseworker signature noting that they have been reviewed. Testing showed that one out of the sixty samples the ERQ forms was not properly reviewed, missing signature and reviewer name.Questioned costs: None.Context: No reviewer signature or indication of review on the ERQ form was noted during RESEA testing.Cause: During testing RESEA requirements, we noted that the ERQ form was not properly reviewed, missing signature and reviewer name.Effect: We were not able to determine if proper internal controls were performed.Repeat Finding: No.Recommendation: CLA recommends that internal controls are in place to ensure all applications are reviewed and indicate review with case manager?s signature.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 019Federal Agency: Department of LaborState Department/Agency: Kansas Department of LaborFederal Program: Unemployment Insurance, COVID-19 Unemployment InsuranceAssistance Listing Number: 17.225Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Material Weakness in Internal Control Over Compliance, Material Non-ComplianceCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: When reconciling the population of disbursements to the SEFA and general ledger it was noted that total unemployment payments of $20,082,366, or 1.14% of the total fiscal year 2021 expenditures, was disbursed to payees that were flagged by the financial institution. These disbursements were flagged because the financial institution had mechanisms in place, rather than the Kansas Department of Labor catching these items directly. The financial institution considered the disbursement invalid due to fraud or other errors; such as the recipients bank account was closed, account number errors, incorrect name, address were incorrect, etc. These disbursements were identified by the financial institution and not considered questioned costs.Questioned costs: None.Context: During testing it was found that individual unemployment insurance payments were either fraudulently obtained or sent to the incorrect account.Cause: Internal controls over processing of claim information was not sufficient to identify material errors that were ultimately identified by the financial institution processing the transaction.Effect: The potential effect includes federal expended dollars being disbursed to ineligible individuals.Repeat Finding: No.Recommendation: We recommend the Kansas Department of Labor implement controls to ensure that unemployment payment insurance payments are processed accurately.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 020Federal Agency: Department of LaborState Department/Agency: Kansas Department of LaborFederal Program: Unemployment Insurance, COVID-19 Unemployment InsuranceAssistance Listing Number: 17.225Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During eligibility testing, general eligibility controls and compliance requirements were tested. As part of this testing, documentation within the mainframe system was reviewed to ensure the agency?s computer system sets start and end dates for payments to each claimant to make sure that claimants are receiving the appropriate benefits during the proper time period. During testing it was noted that one out of the sixty claimants tested received benefits before the payment start date set in the mainframe system.Questioned costs: None.Context: We noted through eligibility testing that one individual?s unemployment insurance claims started on 1/11/2020 and per the mainframe system the payments started on 3/29/2020.Cause: Internal controls are in place but did not stop the error from occurring.Effect: The potential for the overpayment of benefits in the system is possible due to claimants only be awarded benefits for a certain period. Given only one instance from our eligibility testing noted this issue, we do not consider this a pervasive issue for this specific issue.Repeat Finding: No.Recommendation: We recommend that the Kansas Department of Labor implement a control in place to review payments to ensure they are starting on the correct date.Views of responsible officials: There is no disagreement with the audit finding.

2021 ? 021Federal Agency: Department of LaborState Department/Agency: Kansas Department of LaborFederal Program: Unemployment Insurance, COVID-19 Unemployment InsuranceAssistance Listing Number: 17.225Award Period: July 1, 2020 through June 30, 2021Compliance Requirement: EligibilityType of Finding: Significant Deficiency in Internal Control Over Compliance, Other MattersCriteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.Condition: During eligibility testing, general eligibility controls and compliance requirements were tested. As part of the testing, general ledger accounts were reviewed to ensure payments were entered into the correct account. It was noted during testing that two payments out of the sixty payments tested were incorrectly coded within the mainframe system.Questioned costs: None.Context: During testing of eligibility, it was found that the coding of individual payments was incorrect in the mainframe system. This was later corrected by staff at the Kansas Department of Labor.Cause: Internal controls are not design sufficiently or at enough precision to coding errors.Effect: The potential for coding payments wrong could lead to further discrepancies in reporting federal expenditures.Repeat Finding: No.Recommendation: We recommend the Kansas Department of Labor review the coding of unemployment insurance payments to ensure payments are coded correctly.Views of responsible officials: There is no disagreement with the audit finding.

2020 ? 004Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and Environment (KDHE)Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX), COVID-19-Medical Assistance Program ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778Award Period: July 1, 2019 through June 30, 2020Compliance Requirement: Eligibility ? Eligibility for IndividualsType of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per 42 CFR 435.916, redeterminations must be made for all Medicaid Beneficiaries annually. Condition: From a sample of sixty individuals, the annual redetermination process was not completed for one of the selections. Questioned costs: None. Context: One of the sixty sampled individual Medicaid recipients did not have annual redetermination competed, which is an error rate of 1.6%. A non-statistical sampling method was used to select the sample.Cause: No redetermination was sent to the household for the beneficiary to complete and return to KDHE. Lack of review over the redetermination process could have contributed to this finding.Effect: Compliance with the case documentation requirement for this program is not being met and presents difficulty in proving there were not improper payments made.Repeat Finding: Yes, see finding 2019-005.Recommendation: We recommend that KDHE reviews the process of redeterminations being sent to the household and identify any problem areas in the process which could undermine the redetermination frequency.Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and Environment (KDHE)Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX), COVID-19-Medical Assistance Program ? Medicaid ClusterCFDA Number: 93.775, 93.777, 93.778Award Period: July 1, 2019 through June 30, 2020Compliance Requirement: Special Tests and Provisions ? Provider Health and Safety StandardsType of Finding: Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. Condition: From a sample of sixty providers, one of the providers did not have a recertification survey completed withing the required timeframe. Questioned costs: None. Context: An error rate of 1.7% is noted for this testing. A non-statistical sampling method was used to select the sample. Cause: Due to the public health emergency, KDHE has not been able to conduct normal recertification surveys. Effect: Compliance with the provider health and safety standards requirement for this program is not being met. Repeat Finding: Yes, see finding 2019-010.Recommendation: We recommend that the State annually, at a minimum, review a listing of providers who have upcoming recertification deadlines upcoming and try to prioritize those providers in order to ensure that the required recertification surveys are completed in a timely manner.Views of responsible officials: There is no disagreement with the audit finding.

2020 ? 006Federal Agency: U.S. Department of Health and Human ServicesState Department/Agency: Kansas Department of Health and Environment (KDHE)Federal Program: Children?s Health Insurance Program (CHIP), COVID-19-Children's Health Insurance ProgramCFDA Number: 93.767Award Period: July 1, 2019 through June 30, 2020 Compliance Requirement: Eligibility ? Eligibility for IndividualsType of Finding: Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement: Per 42 CFR 457.343, redeterminations must be made for all CHIP beneficiaries at the same frequency as mentioned under 42 CFR 457.343 for Medicaid beneficiaries (annually).Condition: From a sample of sixty individuals, the annual redetermination process was not completed for three of the selections.Questioned costs: None.Context: Three of the sixty sampled individual CHIP recipients did not have annual redetermination completed, which is an error rate of 5%. A non-statistical sampling method was used to select the sample.Cause: No redetermination was sent to the household for the beneficiaries to complete and return to KDHE. Lack of review over the redetermination process could have contributed to this finding. Effect: Compliance with the case documentation requirement for this program is not being met and presents difficulty in proving there were not improper payments made. Repeat Finding: Yes, finding 2019-006. Views of responsible officials: There is no disagreement with the audit finding.

2020 ? 007 Federal Agency: U.S. Department of TransportationFederal Program: Highway Planning and Construction, Recreational Trails Program ? Highway Planning and Construction ClusterCFDA Number: 20.205, 20.219Award Period: July 1, 2019 through June 30, 2020Compliance Requirement: Special Test ? Quality Assurance ProgramType of Finding: Significant Deficiency in Internal Control over Compliance, Other MattersCriteria or specific requirement: Per 23 CFR section 637.205, the verification sampling and testing are to be performed by qualified testing personnel employed by the State Highway Administration or its designated agent.Condition: From a sample of forty inspections, an inspection was not completed by a certified inspector for one of the selections. Questioned costs: None.Context: One of the forty sampled quality assurance inspections did not have an inspector with a current certification for the skill needed to perform the inspection, which is an error rate of 2.5%. A non-statistical sampling method was used to select the sample.Cause: Inspectors' skills are not reviewed to determine they have current certifications for the skills needed prior to the quality assurance inspection.Effect: The unqualified inspector could approve materials and workmanship that does not conform to approved plans and specifications.Repeat Finding: No.Recommendation: We recommend that KDOT reviews inspectors' skills prior to inspection to determine the inspector is qualified. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per Office of Management and Budget (OMB) 0938-1265, CMS-64 reports are required to be filed 30 days after the end of the quarter. Condition: From a sample of two reports, neither report was filed in a timely manner. Questioned costs: None. Context: Of the two reports that were selected to be reviewed, neither report was filed within the required 30-day window from the end of the quarter. This is an error rate of 100%. A non-statistical sampling methodology was used to select the sample. Cause: Staffing turnover and training of new staff was the cause of the un-timely submission. Effect: Compliance with the timeliness reporting requirement for this program is not being met. Repeat Finding: No. Recommendation: We recommend that KDHE increase training efforts to ensure there is staff sufficiently trained to complete the required reports if there is future staffing turnover. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Eligibility ? Eligibility for Individuals Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per 42 CFR 435.914, the agency must include in each applicant's case records facts to support the agency's decision on their application. Condition: From a sample of sixty individual Medicaid participants, applications were missing for two selections. Questioned costs: None. Context: Two of the sixty sampled individual Medicaid recipients did not have an application on file, which is an error rate of 3.3%. CLA was also unable to verify the internal control related to application review as there was no application record available to determine if the Medicaid recipient was set up correctly based on their application. A non-statistical sampling methodology was used to select the sample. Cause: During implementation of the new Kansas Eligibility Enforcement System (KEES), applications had to be manually scanned into the new KEES. Due to the volume of the applications to be transferred, some were missed. Effect: Compliance with the case documentation requirement for this program is not being met and presents difficulty in proving there were no improper payments made. Repeat Finding: No. Recommendation: We recommend that KDHE improve the application receiving process and data retention efforts for new applications to ensure accuracy and investigate data recovery efforts for any KEES transfer participant who is missing initial application documentation. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Eligibility ? Eligibility for Individuals Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per 42 CFR 435.916, redeterminations must be made for all Medicaid Beneficiaries annually. Condition: From a sample of sixty individuals, the annual redetermination process was not completed for one of the selections. Questioned costs: None. Context: One of the sixty sampled individual Medicaid recipients did not have annual redetermination competed, which is an error rate of 1.6%. A non-statistical sampling method was used to select the sample. Cause: No redetermination was sent to the household for the beneficiary to complete and return to KDHE. Lack of review over the redetermination process could have contributed to this finding. Effect: Compliance with the case documentation requirement for this program is not being met and presents difficulty in proving there were no improper payments made. Repeat Finding: No. Recommendation: We recommend that KDHE review the process of redeterminations being sent to the household and identify any problem areas in the process which could undermine the redetermination frequency. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: Children?s Health Insurance Program (CHIP) CFDA Number: 93.767 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Eligibility ? Eligibility for Individuals Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per 42 CFR 457.343, redeterminations must be made for all CHIP beneficiaries at the same frequency as mentioned under 42 CFR 457.343 for Medicaid beneficiaries (annually). Condition: From a sample of forty individuals, the annual redetermination process was not completed for two of the selections. Questioned costs: None. Context: Two of the forty sampled individual CHIP recipients did not have annual redetermination completed, which is an error rate of 5%. A non-statistical sampling method was used to select the sample. Cause: No redetermination was sent to the household for the beneficiaries to complete and return to KDHE. Lack of review over the redetermination process could have contributed to this finding. Effect: Compliance with the case documentation requirement for this program is not being met and presents difficulty in proving there were not improper payments made. Repeat Finding: No. Recommendation: We recommend that KDHE review the process of redeterminations being sent to the household and assess any problem areas in the process which could undermine the redetermination frequency. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Special Tests and Provisions ? Utilization Control and Program Integrity Type of Finding: Material Weakness in Internal Control over Compliance, Material Non-Compliance Criteria or specific requirement: Per 42 CFR 455 Part A, State Medical Agencies (SMAs) must have fraud detection and investigative plans which must be followed. State of Kansas has contracts in place with multiple Managed Care Organizations (MCOs), and each of the MCOs has a specific investigative process for fraud detection. Condition: From a sample of twenty-two provider cases, the State was unable to provide audit evidence for eight selections to support that the investigative procedure was followed. Questioned costs: None. Context: For the eight exceptions, the MCO provided only Microsoft Word documents with a narrative of the procedures performed. This is not sufficient evidence as support was not provided to show that the procedures had in fact been carried out by the MCO. This is an error rate of 27.5%. A non-statistical sampling methodology was used to select the sample. Cause: Responses to our audit requests were not timely and in cases were incomplete or did not provide sufficient audit evidence. The untimeliness could have contributed to this finding. Effect: Compliance with the utilization control and program integrity requirement for this program is not being met. Repeat Finding: No. Recommendation: We recommend that the State work more closely and in a more timely fashion with the MCOs to obtain necessary documents. The State should work with the MCOs to maintain a more organized pool of required documentation so it is more readily available. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Special Tests and Provisions ? Provider Eligibility (Screening and Enrollment) Type of Finding: Material Weakness in Internal Control over Compliance, Material Non-Compliance Criteria or specific requirement: Per 42 CFR 455 part B, providers are required to disclose information on (a) ownership and control, (b) business transaction, and (c) persons convicted of crimes. Condition: Six of the forty providers tested were exceptions due to an MCO being non-responsive to any requests submitted for audit testing and thus we were unable to verify that disclosure requirements were met. Five of the forty tested were due to other MCOs not submitting any audit evidence to verify that disclosure requirements were met. Questioned costs: None. Context: Six of the forty tested were due to an MCO being non-responsive to any requests submitted for audit testing. Five of the forty tested were due to other MCOs not submitting any audit evidence to verify that disclosure requirements were met. This is an error rate of 27.5%. A non-statistical sampling methodology was used to select the sample. Cause: The State was unable to provide support for one MCO selected due to the MCO's unresponsiveness once the MCO's contract ended at the end of calendar year 2018 with the State. The other responses from the other MCOs to our audit requests were not timely and in cases were incomplete or did not provide sufficient audit evidence. Effect: Compliance with the provider eligibility requirement for this program is not being met. Repeat Finding: No. Recommendation: We recommend that the State work more closely and in a more timely fashion with the MCOs to obtain necessary documents. The State should work with the MCOs to maintain a more organized pool of required documentation so it is more readily available. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Special Tests and Provisions ? Provider Eligibility (Screening and Enrollment) Type of Finding: Material Weakness in Internal Control over Compliance, Material Non-Compliance Criteria or specific requirement: Per 42 CFR 455.410, SMAs must require all enrolled providers to be screened under this subpart. Condition: From the sample of forty providers, the State was unable to provide documentation to verify that ten of the selections were properly screened and licensed. Questioned costs: None. Context: Six of the ten exceptions were due to an MCO being non-responsive to any requests submitted. The remaining four exceptions are due to other MCOs not providing any supporting documentations to verify screening/licensing of providers. This is an error rate of 25%. A non-statistical sampling methodology was used to select the sample. Cause: The State was unable to provide support for one MCO selected due to the MCO's unresponsiveness once the MCO's contract ended at the end of calendar year 2018 with the State. The other responses from the other MCOs to our audit requests were not timely and in cases were incomplete or did not provide sufficient audit evidence. Effect: Compliance with the provider eligibility requirement for this program is not being met. Repeat Finding: No. Recommendation: We recommend that the State work more closely and in a more timely fashion with the MCOs to obtain necessary documents. The State should work with the MCOs to maintain a more organized pool of required documentation so it is more readily available. Views of responsible officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services State Department/Agency: Kansas Department of Health and Environment (KDHE) Federal Program: State Medicaid Fraud Control Units, State Survey and Certification of Health Care Providers and Suppliers (Title XVIII) Medicare, Medical Assistance Program (Medicaid; Title XIX) ? Medicaid Cluster CFDA Number: 93.775, 93.777, 93.778 Award Period: July 1, 2018 through June 30, 2019 Compliance Requirement: Special Tests and Provisions ? Provider Health and Safety Standards Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Criteria or specific requirement: Per 42 CFR part 442, providers must meet the prescribed health and safety standards for hospitals, nursing facilities, and ICF/IID. Condition: From a sample of sixty providers, no documentation was provided to support the claim that the State completed the review of two providers to ensure that prescribed health and safety conditions were being met. Questioned costs: None. Context: An error rate of 3.3% is noted for this testing. A non-statistical sampling method was used to select the sample. Cause: The State was unable to provide evidence to support the claim of provider reviews being completed as required. Lack of organized data retention could have contributed to this finding. Effect: Compliance with the provider health and safety standards requirement for this program is not being met. Repeat Finding: No. Recommendation: We recommend that the State work more closely and in a more timely fashion with the MCOs to obtain necessary documents. The State should work with the MCOs to maintain a more organized pool of required documentation so it is more readily available. Views of responsible officials: There is no disagreement with the audit finding.

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