REPORT DIGEST

 

DEPARTMENT OF CHILDREN AND FAMILY SERVICES

 

FINANCIAL AUDIT

and

COMPLIANCE EXAMINATION

For the Year Ended:

June 30, 2007

 

Summary of Findings:

Total this audit†††††††††††      9

Total last audit†††††††††      12

Repeated from last audit    8

 

Release Date:

May 20, 2008

 

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

AUDITOR GENERAL

 

To obtain a copy of the Report contact:

Office of the Auditor General

Iles Park Plaza, 740 E. Ash Street

Springfield, IL 62703

(217) 782-6046 or TTY (888) 261-2887

 

This Report Digest and the Full Report are available on the worldwide web at www.auditor.illinois.gov

 

 

 

 

SYNOPSIS

 

 

 

®      Child welfare and foster care files lacked complete and timely prepared documentation.

 

®      The Department's child abuse investigations did not always fully comply with State law.For instance, the Department:

 

-                      Did not always determine whether reports of child abuse and neglect were "unfounded" or "indicated" within 60 days.

 

-                      Failed to initiate some investigations of child abuse and neglect within 24 hours of receipt.

 

®      All contracts were not reviewed and signed prior to the beginning of the contract period.

 

®      Contracts with residential and group home service providers did not all include measurable criteria necessary to ensure desired results are achieved.

 

®      Overpayments were made to the CMS Telecommunications Revolving Fund in Fiscal Years 2005, 2006 and 2007.Estimated overpayments total $1,400,000.

 


DEPARTMENT OF CHILDREN AND FAMILY SERVICES

FINANCIAL AUDIT AND COMPLIANCE EXAMINATION

For The Year Ended June 30, 2007

 

EXPENDITURE STATISTICS

FY 2007

FY 2006

         Total Expenditures (All Funds)...................

 

$1,264,459,082

$1,241,370,236

†††† OPERATIONS TOTAL.................................

†††††††† % of Total Expenditures........................

$275,685,253

22%

$260,258,215

21%

†††††††† Personal Services...................................

††††††††††† % of Operations Expenditures...........

††††††††††† Average No. of Employees...............

$186,048,044

67%

3,230

$178,064,339

68%

3,224

†††††††† Other Payroll Costs (FICA,

†††††††† Retirement)....................................................

††††††††††† % of Operations Expenditures...........

 

$35,314,327

13%

 

$28,485,774

11%

†††††††† Contractual Services...............................

††††††††††† % of Operations Expenditures...........

$32,422,591

12%

$33,740,238

13%

†††††††† All Other Operations Items.....................

††††††††††† % of Operations Expenditures......................

$21,900,291

8%

$19,967,864

8%

†††† LUMP SUM AND OTHER PURPOSES TOTAL..........................................................

†††††††† % of Total Expenditures.............................

 

$45,788,291

4%

 

$47,211,080

4%

†††† AWARDS AND GRANTS TOTAL................

†††††††† % of Total Expenditures........................

$942,985,538

74%

$933,900,941

75%

         Cost of Property and Equipment (unaudited).

$30,226,000

$30,997,000

 

SELECTED ACTIVITY MEASURES (unaudited)

FY 2007

FY 2006

         Hotline Calls........................................................

258,563

257,481

         Children served in-

†††† - ††† Regular foster care..........................................

-          Specialized foster care.....................................

-          Relative care...................................................

-          Residential placements.....................................

-          Independent living............................................

 

5,094

3,199

5,858

1,253

936

 

5,471

3,494

6,189

1,361

929

         Finalized adoptions...............................................

1,682

1,670

 

AGENCY DIRECTOR

†††† During Audit Period:Mr. Bryan Samuels (7-1-06 Ė 11-17-06), Mr. Erwin McEwen, Acting (eff. 11-17-06)

†††† Currently:Mr. Erwin McEwen

 



 

 

 

 

 

 

 

 

 

 

Child case files incomplete and not timely prepared

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All child abuse and neglect determinations not timely completed

 

 

 

 

 

 

 

 

 

 

Historical Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

All child abuse and neglect reports not investigated timely

 

 

 

 

 

 

 

 

 

Historical Analysis

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracts signed after beginning of contract period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


Additional contract provisions needed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overpayments made in 2005, 2006, and 2007

Estimated $1.4 million in overpayments

 

 

 

 

 

 

 

 

 

 


Duplicate payments made based on CMS Aging Report

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDINGS, CONCLUSIONS, AND RECOMMENDATIONS

 

INCOMPLETE AND UNTIMELY CHILD WELFARE AND FOSTER CARE FILES

 

††††† The Departmentís Child Welfare and Foster Care files lacked required documentation and not all case procedures were performed timely.During our review of 60 case files, we noted:

 

-         3 administrative case reviews (ACRs) were not performed.

-         11 ACR notifications were not sent timely or at all.

-         4 Registration and Case Opening Forms were not completed.

-         2 Worker Activity Summaries were not completed.

-         2 Client Contact Summaries were not completed.

-         1 Family Assessment Factor Worksheet was not completed.

-         1 Safety Determination Form was not completed.

-         11 medical and dental consent forms were not in the file or were outdated.

-         1 Placement and Payment Authorization Form was not in the file.

-         6 files did not contain current photographs of the child.

-         28 files did not contain fingerprints of the child.

-         16 Permanency Planning Checklists were not in the file.

-         2 initial placement checklist forms were not in the file.

 

The Departmentís Administrative Procedures prescribe deadlines and documentation requirements for file maintenance.The failure to follow established Department procedures could result in inadequate care, unauthorized services or misuse of State funds.(Finding 1, pages 10-12)This finding was first reported in 1998.

 

Department officials stated they will continue to stress the importance of adequate and timely documentation for the child case files.(For the previous agency response, see Digest Footnote #1.)

 

 

 

 

OVERDUE CHILD ABUSE AND NEGLECT DETERMINATIONS

 

††††† Reports of child abuse and neglect were not always determined within 60 days as required by the Abused and Neglected Child Reporting Act.The Act states the Department shall determine, within 60 days, whether a report is "unfounded" or "indicated" and provides that the Department may extend the period up to an additional 30 days for good cause.Department statistics indicate the following noncompliance:

 

††††††††††† ††††††† Total†††††††

††††††††††† †††† Reports†††††† Determinations††† †††††† Percent of

Fiscal†† ††† Requiring†††††††††††††† Not††††††††††††† Determinations

Year††† DeterminationsIn Compliance††††† Not In Compliance

2007††††† †† 67,732††††††††††††††† †† 538†††††††††††††††††††† .79%

2006††††† †† 66,593††††††††††††††† 1,060†††††††††††††††††††† 1.59%

2005††††† †† 66,550††††††††††††††† 1,140†††††††††††††††††††† 1.71%

2004††††† †† 62,069††††††††††††††† 1,294†††††††††††††††††††† 2.08%

2003††††† †† 58,956††††††††††††††† †† 952†††††††††††††††††††† 1.61%

2002††††† †† 59,080††††††††††††††† †† 492†††††††††††††††††††† 0.83%

2001††††† †† 59,003††††††††††††††† †† 226†††††††††††††††††††† 0.38%

2000††††† †† 61,787††††††††††††††† †† 187†††††††††††††††††††† 0.30%

1999††††† †† 62,054††††††††††††††† 1,502†††††††††††††††††††† 2.42%

1998††††† †† 65,877††††††††††††††† 2,125†††††††††††††††††††† 3.23%

 

††††† Failure to make a determination of a report within 60 days is a violation of the Act, could delay the implementation of a service plan, and could result in further endangerment of the child.(Finding 2, pages 13-14)This finding was first reported in 1998.

 

††††† We recommended the Department determine reports of child abuse or neglect within 60 days as mandated by State law.

 

††††† Department officials stated they will continue in their efforts to be within 100% compliance of the timeframes set forth in the Act.(For the previous agency response, see Digest Footnote #2.)

 

 

 

 

NEED TO INITIATE INVESTIGATIONS WITHIN 24 HOURS OF RECEIPT

 

††††† The Department did not initiate an investigation of every child abuse and neglect case within 24 hours of receipt of the report as required by the Abused and Neglected Child Reporting Act.Department statistics indicate the following noncompliance:

 

††††††††††††††††††††††††††††† ††††    Investigations†††††††††† ††††Percent of

Fiscal†† ††††† Total††††††††† ††††††† Not†††††††††††††† †     Investigations

Year††† Investigations††† In Compliance†††††† Not In Compliance

2007††††††† 67,766††††††††††††††† †† 179†††††††††††††††††††† 0.26%

2006††††††† 66,918††††††††††††††† †† 154†††††††††††††††††††† 0.23%

2005††††††† 66,793†††††††† ††††††† †† 260†††††††††††††††††††† 0.39%

2004††††††† 62,311††††††††††††††† †† 268†††††††††††††††††††† 0.43%

2003††††††† 59,397††††††††††††††† †† 220†††††††††††††††††††† 0.37%

2002††††††† 59,241††††††††††††††† †† 517†††††††††††††††††††† 0.87%

2001††††††† 60,054††††††††††††††† †† 141†††††††††††††††††††† 0.23%

2000††††††† 61,787††††††††††††††† †† 219†††††††††††††††††††† 0.35%

1999††††††† 62,618††††††††††††††† †† 250†††††††††††††††††††† 0.40%

1998††††††† 65,862††††††††††††††† †† 461†††††††††††††††††††† 0.70%

 

††††† Failure to respond to a report of abuse or neglect within 24 hours is a violation of the Act and could result in further endangerment of the child.(Finding 3, pages 15-16)This finding was first reported in 1998.

 

††††† We recommended the Department continue to strive to initiate investigations of all child abuse and neglect reports within 24 hours of receiving the report as mandated by State law.

 

††††† Department officials agreed with the recommendation and stated they will continue to make efforts to be within 100% compliance of the timeframes established.They said corrective action is taken with employees who fail to comply with the Act.(For the previous agency response, see Digest Footnote #3.)

 

UNTIMELY APPROVAL OF CONTRACTS

 

††††† The Department did not have an adequate system in place to ensure that contracts are reviewed and signed on a timely basis.During our review of 21 contracts, we noted that 19 contracts, totaling $41,916,965, were signed after the beginning of the contract period.The Departmentís Code of Regulations and prudent business practice require contracts to be signed prior to the commencement of services or the procurement of goods.Failure to obtain signed contracts before the beginning of the contract period does not bind the contractor to comply with applicable laws, regulations, and rules and may result in improper and unauthorized payments.(Finding 5, pages 18-19).This finding was first reported in 2002.

 

††††† We recommended the Department approve and sign all contracts before the beginning of the contract period.

 

††††† Department officials agreed and stated they will continue efforts to ensure all contracts are approved and signed before the beginning of the contract period.(For the previous agency response, see Digest Footnote #4.)

 

INADEQUATE CONTRACT PROVISIONS

 

††††† The Departmentís contracts with residential and group home service providers did not all include measurable criteria necessary to ensure desired results are achieved.The Department created the Residential Performance Monitoring Unit (RPMU) to conduct monthly on-site monitoring of the facilities that provide treatment for children.Any deficiencies identified in the site visits are communicated to the Departmentís Division of Placement and Permanency which either directs the RPMU to increase the monitoring of the deficient provider or program consultants are utilized.Although the Department made progress in incorporating monitoring and participation requirements in many of the provider contracts, there are still older, existing contracts which do not have specific criteria with which to monitor the services provided.

 

††††† Department officials stated that they are in the process of modifying residential care contracts to include monitoring and participation requirements that were recommended by the RPMU.The absence or insufficiency of these contract requirements could lead to disputes with providers and impede the Departmentís ability to effectively monitor programs.(Finding 8, page 22)This finding was first reported in 2003.

 

††††† We recommended the Department continue in its efforts to develop and include measurable criteria and participation requirements in its contracts with all residential and group home service providers.

 

††††† Department officials agreed with our recommendation.(For the previous agency response, see Digest Footnote #5.)

 

OVERPAYMENT OF TELECOMMUNICATIONS BILLINGS

 

††††† The Department made duplicate payments to the Illinois Department of Central Management Services (CMS) Telecommunications Revolving Fund resulting in an overpayment for telecommunication services.CMS reported that the Department made duplicate payments during fiscal year 2007 and failed to request CMS to apply overpayments from fiscal years 2005 and 2006 to fiscal year 2007 invoices.CMS has estimated that these overpayments totaled approximately $1.4 million.

 

††††† Department management stated they were not aware of the unused overpayment balances from prior fiscal years and had therefore not requested CMS to apply these credits toward fiscal year 2007 CMS billings.They also stated that overpayments at year end can occur for a variety of reasons.CMS billings are frequently not timely and take a considerable amount of time for review within the Department before going to the central payment unit.During the year, the Department pays CMS based upon specific invoices received.Consequently, there is a significant time lag from the point the services are rendered, an invoice is received, a voucher is processed, and the Comptroller issues a warrant.However, as the end of the lapse period approached, the Department made a decision to pay from the CMS Accounts Receivable Aging Report to ensure all FY 07 bills were paid before the lapse period ended.When the Department pays from the Accounts Receivable Aging Report, there is the possibility that in-transit payments are paid twice.This can occur because payments made, but not received and/or entered by CMS prior to the year end report, would still show up as outstanding.The CMS Aging Report is approximately 200 pages long and includes all of the Departmentís approximately 150 billing accounts.(Finding 9, pages 23-24)

 

††††† We recommended the Department communicate with CMS to ascertain the amount overpaid and immediately request this amount be applied to outstanding invoices.We also recommended the Department establish procedures to enable payment of specific invoices rather than paying from the CMS Aging Report in order to avoid duplicate payments.

 

††††† Department officials stated they have communicated with CMS and determined that all credits were applied in fiscal year 2008.They are in the process of modifying the vendor payment history review process and will only make payments from invoices.

 

OTHER FINDINGS

 

††††† The remaining findings are reportedly being given attention by the Department.We will review progress toward the implementation of our recommendations during the next examination.

 

AUDITORSí OPINION

 

††††† Our auditors stated the Department's June 30, 2007 financial statements are fairly presented in all material respects.

 

 

 

 

____________________________________

WILLIAM G. HOLLAND, Auditor General

 

WGH:KMA:pp

 

 

SPECIAL ASSISTANT AUDITORS

 

††††† Our special assistant auditors were Sleeper, Disbrow, Morrison, Tarro & Lively, LLC.

 

 

 

DIGEST FOOTNOTES

 

#1:INCOMPLETE AND UNTIMELY CHILD WELFARE AND FOSTER CARE FILES - Previous Agency Response

 

The Department agrees and will continue to stress the importance of adequate and timely documentation for those cases identified by the auditors finding as well as for all child and family cases.The Department will continue its review of its administrative and internal procedures (AP#5) and policy guides, as systems are upgraded, to better define the contents of system files and paper files and which should be relied upon as the file of record.

 

#2:OVERDUE CHILD ABUSE AND NEGLECT DETERMINATIONS - Previous Agency Response

 

The Department agrees and will continue to make diligent efforts to be within 100% compliance of the timeframes set forth in ANCRA for making final determinations.

 

#3:NEED TO INITIATE INVESTIGATIONS WITHIN 24 HOURS OF RECEIPT - Previous Agency Response

 

The Department agrees with the recommendation and will continue to make efforts to be within 100% compliance of the timeframes established.Investigations not meeting the 24-hour requirement are analyzed and the Department plans to explore corrective action for employees who fail to initiate investigations within the 24-hour timeframe.

 

#4:UNTIMELY APPROVAL OF CONTRACTS - Previous Agency Response

 

The Department agrees and will continue to improve processes that ensure that all contracts are approved and signed before the beginning of the contract period.Our procedures, which included completion of the required Procurement Business Cases, resulted in 970 contracts being mailed to providers prior to July 1.Comparison of the number of contracts returned reflect our efforts to process contracts as soon as they are returned from our vendors:

 

Contracts Processed††††††††††††††††††††††††††††††††††† FY 06††††††††††††††††††††† FY 05

Prior to July 1††††††††††††††††††††††††††††††††††††††††††††††† 196††††††††††††††††††††††† ††††† 0

Within 30 days of July 1†††††††††††††††††††††††††††† 879††††††††††††††††††††††† 577

Within 60 days of July 1†††††††††††††††††††††††††††† 421††††††††††††††††††††††† 642

Within 90 days of July 1†††††††††††††††††††††††††††† 189††††††††††††††††††††††† 398

 

#5:INADEQUATE CONTRACT PROVISIONS Ė Previous Agency Response

 

The Department agrees and plans to continue its efforts to include measurable criteria and participation requirements in the remaining contracts with residential and group homes service providers.

 

In addition, the Department, the Child Care Association of Illinois and the Child Welfare Institute have formed a public-private partnership that was awarded funding from the National Quality Improvement Center on the Privatization of Child Welfare Services.The partnership will design, implement and evaluate extension of the Departmentís existing performance based contracting and quality assurance system to residential, independent living and transitional living programs in order to improve outcomes for this population of out-of-home care youth.The project will work closely with our university partners at Northwestern, University of Illinois Chicago, and Chapin Hall regarding the data elements that are currently tracked.The project will capitalize on the existing Child Welfare Advisory Committee structure to build on recent work regarding performance measures and to also allow frequent communication opportunities for the provider community.Model protocols are planned by August 2007 with a demonstration period planned for October 2007 through June 2008.It is anticipated that full implementation could occur for contracts beginning in July 2008 with forums held in April 2009 and 2010 to assess results and practices.