Ventura County

VENTURA COUNTY Audit Report CHILD ABDUCTION AND RECOVERY PROGRAM Chapter 1399, Statutes of 1976; Chapter 162, Statutes of 1992; and Chapter 988, Statutes of 1996 July 1, 1999, through June 30, 2002 S W TEVE ESTLY California State Controller December 2004 S W TEVE ESTLY California State Controller December 10, 2004 The Honorable Christine L. Cohen Auditor-Controller Ventura County 800 South Victoria Avenue, L#1540 Ventura, CA 93009-1540 Dear Ms. Cohen: The State Controller’s Office audited the claims filed by Ventura County for costs of the legislatively mandated Child Abduction and Recovery Program (Chapter 1399, Statutes of 1976; Chapter 162, Statutes of 1992; and Chapter 988, Statutes of 1996) for the period of July 1, 1999, through June 30, 2002. The county claimed $1,682,245 ($1,683,245 less a $1,000 penalty for filing a late claim) for the mandated program. Our audit disclosed that $1,601,726 is allowable and $80,519 is unallowable. The unallowable costs occurred primarily because the county claimed unsupported costs, overstated its indirect cost rate, and did not report offsetting savings. The State paid the county $857,401. Allowable costs claimed exceed the amount paid by $744,325. If you have any questions, please contact Jim L. Spano, Chief, Compliance Audits Bureau, at (916) 323-5849. Sincerely, Original Signed By: VINCENT P. BROWN Chief Operating Officer VPB:JVB/jj cc: (See page 2) The Honorable Christine L. Cohen -2- December 10, 2004 cc: Tom Dawson Financial Analyst Auditor-Controller’s Office Ventura County The Honorable Gregory D. Totten District Attorney Ventura County Melvin L. Chambers, Manager Fiscal and Administrative Services Ventura County District Attorney’s Office James Tilton, Program Budget Manager Corrections and General Government Department of Finance Ventura County Child Abduction and Recovery Program Contents Audit Report Summary............................................................................................................................ 1 Background........................................................................................................................ 1 Objective, Scope, and Methodology................................................................................. 2 Conclusion.......................................................................................................................... 2 Views of Responsible Official........................................................................................... 3 Restricted Use.................................................................................................................... 3 Schedule 1—Summary of Program Costs............................................................................ 4 Findings and Recommendations........................................................................................... 6 Attachment—County’s Response to Draft Audit Report Steve Westly • California State Controller Ventura County Child Abduction and Recovery Program Audit Report Summary The State Controller’s Office (SCO) audited the claims filed by Ventura County for costs of the legislatively mandated Child Abduction and Recovery Program (Chapter 1399, Statutes of 1976; Chapter 162, Statutes of 1992; and Chapter 988, Statutes of 1996) for the period of July 1, 1999, through June 30, 2002. The last day of fieldwork was June 16, 2004. The county claimed $1,682,245 ($1,683,245 less a $1,000 penalty for filing a late claim) for the mandated program. The audit disclosed that $1,601,726 is allowable and $80,519 is unallowable. The unallowable costs occurred primarily because the county claimed unsupported costs, overstated its indirect cost rate, and did not report offsetting savings. The State paid the county $857,401. Allowable costs claimed exceed the amount paid by $744,325. Background Family Code Sections 3060 through 3064; Penal Code Sections 277, 278, and 278.5; and Welfare and Institutions Code Section 114785 were added and amended by Chapter 1399, Statutes of 1976; Chapter 162, Statutes of 1992; and Chapter 988, Statutes of 1996. The law requires the District Attorney’s Office to assist persons having legal custody of a child in: • Locating their children when they are unlawfully taken away; • Gaining enforcement of custody and visitation decrees and orders to appear; • Defraying expenses related to the return of an illegally detained, abducted, or concealed child, • Civil court action proceedings; and • Guaranteeing the appearance of offenders and minors in court actions. On September 19, 1979, the State Board of Control, (now the Commission on State Mandates) determined that this legislation imposed a state mandate reimbursable under Government Code Section 17561. Parameters and Guidelines establishes the state mandate and defines reimbursement criteria. The Commission on State Mandates adopted the Parameters and Guidelines on January 21, 1981, and last amended it on August 26, 1999. In compliance with Government Code Section 17558, the SCO issues claiming instructions for mandated programs, to assist local agencies in claiming reimbursable costs. Steve Westly • California State Controller 1 Ventura County Child Abduction and Recovery Program Objective, We conducted the audit to determine whether costs claimed represent increased costs resulting from the Child Abduction and Recovery Scope, and Program for the period of July 1, 1999, through June 30, 2002. Methodology Our audit scope included, but was not limited to, determining whether costs claimed were supported by appropriate source documents, not funded by another source, and not unreasonable and/or excessive. We conducted the audit according to Government Auditing Standards, issued by the Comptroller General of the United States, and under the authority of Government Code Section 17558.5. We did not audit the county’s financial statements. Our scope was limited to planning and performing audit procedures necessary to obtain reasonable assurance that costs claimed were allowable for reimbursement. Accordingly, we examined transactions, on a test basis, to determine whether the costs claimed were supported. We limited our review of the county’s internal controls to gaining an understanding of the transaction flow and claim preparation process as necessary to develop appropriate auditing procedures. Conclusion The audit disclosed instances of noncompliance with the requirements outlined above. These instances are described in the accompanying Summary of Program Costs (Schedule 1) and in the Findings and Recommendations section of this report. For the audit period, Ventura County claimed $1,682,245 ($1,683,245 less a $1,000 penalty for filing a late claim) for Child Abduction and Recovery Program costs. The audit disclosed that $1,601,726 is allowable and $80,519 is unallowable. For fiscal year (FY) 1999-2000, the State paid the county $365,780. The audit disclosed that $331,156 is allowable. The county should return $34,624 to the State. For FY 2000-01, the State paid the county $191,621. The audit disclosed that $523,027 is allowable. The State will pay allowable costs claimed that exceed the amount paid, totaling $331,406, contingent upon available appropriations. For FY 2001-02, the State paid the county $300,000. The audit disclosed that $747,543 is allowable. The State will pay allowable costs claimed that exceed the amount paid, totaling $447,543, contingent upon available appropriations. Steve Westly • California State Controller 2 Ventura County Child Abduction and Recovery Program Views of We issued a draft audit report on October 29, 2004. Christine L. Cohen, Auditor-Controller, responded by letter dated November 12, 2004, Responsible (Attachment) agreeing with the audit results. The final audit report Official includes the county’s response. Restricted Use This report is solely for the information and use of Ventura County, the California Department of Finance, and the SCO; it is not intended to be and should not be used by anyone other than these specified parties. This restriction is not intended to limit distribution of this report, which is a matter of public record. Original Signed By: JEFFREY V. BROWNFIELD Chief, Division of Audits Steve Westly • California State Controller 3 Ventura County Child Abduction and Recovery Program Schedule 1— Summary of Program Costs July 1, 1999, through June 30, 2001 Actual Costs Allowable Audit Cost Elements Claimed per Audit Adjustments Reference 1 July 1, 1999, through June 30, 2000 Salaries and benefits $ 241,604 $ 223,966 $ (17,638) Finding 1 Services and supplies 32,400 32,400 — Subtotals 274,004 256,366 (17,638) Indirect costs 92,776 75,790 (16,986) Findings 1, 2 Subtotals 366,780 332,156 (34,624) Less offsetting savings/reimbursements — — — Total claimed costs 366,780 332,156 (34,624) Less late filing penalty (1,000) (1,000) — Total net claim $ 365,780 331,156 $ (34,624) Less amount paid by the State (365,780) Allowable costs claimed in excess of (less than) amount paid $ (34,624) July 1, 2000, through June 30, 2001 Salaries and benefits $ 345,253 $ 338,982 $ (6,271) Finding 1 Services and supplies 62,281 62,281 — Subtotals 407,534 401,263 (6,271) Indirect costs 124,982 122,712 (2,270) Finding 1 Subtotals 532,516 523,975 (8,541) Less offsetting savings/reimbursements — (948) (948) Finding 3 Total claimed costs 532,516 523,027 (9,489) Less late filing penalty — — — Total net claim $ 532,516 523,027 $ (9,489) Less amount paid by the State (191,621) Allowable costs claimed in excess of (less than) amount paid $ 331,406 July 1, 2001, through June 30, 2002 Salaries and benefits $ 549,646 $ 522,678 $ (26,968) Finding 1 Services and supplies 41,927 41,927 — Subtotals 591,573 564,605 (26,968) Indirect costs 192,376 182,938 (9,438) Finding 1 Subtotals 783,949 747,543 (36,406) Less offsetting savings/reimbursements — — — Steve Westly • California State Controller 4 Ventura County Child Abduction and Recovery Program Schedule 1 (continued) Actual Costs Allowable Audit Cost Elements Claimed per Audit Adjustments Reference 1 July 1, 2001, through June 30, 2002 (continued) Total claimed costs 783,949 747,543 (36,406) Less late filing penalty — — — Total net claim $ 783,949 747,543 $ (36,406) Less amount paid by the State (300,000) Allowable costs claimed in excess of (less than) amount paid $ 447,543 Summary: July 1, 1999, through June 30, 2002 Salaries and benefits $ 1,136,503 $ 1,085,626 $ (50,877) Finding 1 Services and supplies 136,608 136,608 — Subtotals 1,273,111 1,222,234 (50,877) Indirect costs 410,134 381,440 (28,694) Findings 1, 2 Subtotals 1,683,245 1,603,674 (79,571) Less offsetting savings/reimbursements — (948) (948) Finding 3 Total claimed costs 1,683,245 1,602,726 (80,519) Less late filing penalty (1,000) (1,000) — Total net claim $ 1,682,245 1,601,726 $ (80,519) Less amount paid by the State (857,401) Allowable costs claimed in excess of (less than) amount paid $ 744,325 _________________________ 1 See the Findings and Recommendations section. Steve Westly • California State Controller 5 Ventura County Child Abduction and Recovery Program Findings and Recommendations FINDING 1— The county claimed unallowable salary and benefit costs of $50,877 for the audit period. The related indirect costs total $18,481. Unallowable salaries, benefits, and related The county did not support $26,904 of the $136,133 claimed for indirect costs part-time investigators’ salaries and benefits for the audit period. The county claimed 2,237 hours, yet was able to support only 904 hours through time logs, overtime request forms, and contemporaneously prepared case file memoranda. For FY 2001-02, the county did not support $23,973 of the annual salaries and benefits claimed for an investigator and a legal processing assistant related to the mandate. The investigator performed mandated activities effective August 20, 2001. The legal processing agent performed mandated activities from October 29, 2001, through June 22, 2002. Parameters and Guidelines specifies that only the actual increased costs incurred and supported by appropriate documentation are reimbursable. Following is a summary of the audit adjustments to salary and benefit costs and to related indirect costs. Fiscal Year 1999-2000 2000-01 2001-02 Total Salaries and benefits: Unsupported part-time investigators $ (17,638) $ (6,271) $ (2,995) $ (26,904) Unsupported salary costs claimed — — (23,973) (23,973) Total salaries and benefits (17,638) (6,271) (26,968) (50,877) Related indirect costs (6,773) (2,270) (9,438) (18,481) Audit adjustment $ (24,411) $ (8,541) $ (36,406) $ (69,358) Recommendation We recommend that the county implement policies and procedures to ensure that it supports all claimed costs. FINDING 2— For FY 1999-2000, the county overstated indirect costs by $10,213. Overstated indirect costs The county included $823,013 of services and supplies (uniform and safety clothing, witness and interpreter expenses, other professional and special services, temporary help, special department expenses, and lease payments) as indirect rather than direct costs when calculating the District Attorney’s Office indirect cost rate proposal (ICRP). In the following two fiscal years, the county included the same activities as direct costs. Steve Westly • California State Controller 6 Ventura County Child Abduction and Recovery Program The adjustment of the $823,013 in services and supplies resulted in a reduction of the ICRP by 4.56%, from 38.4% to 33.84%. The overstated ICRP resulted in the following adjustment: Fiscal Year 1999-2000 Supported ICRP 33.84% Claimed ICRP (38.40)% Overstated ICRP (4.56)% Allowable costs $ 223,966 Overstated ICRP × (4.56)% Audit adjustment $ 10,213 Parameters and Guidelines states that actual costs claimed are to be traceable to source documents that show evidence of the validity of such costs and their relationship to the mandate program. Recommendation We recommend that the county ensure that it properly supports all claimed costs. FINDING 3— For FY 2000-01, the county did not reduce claimed costs by the $948 it received in restitution payments from defendants for partial Unreported reimbursement of mandate-related costs. reimbursements Parameters and Guidelines states that funds received as a result of costs assessed against a defendant or other party in a criminal or civil action for the return or care of a minor must be shown and used as an offset against the claimed costs. Recommendation We recommend that the county ensure that any costs reimbursed from other revenue sources are deducted from the costs claimed. Steve Westly • California State Controller 7 Ventura County Child Abduction and Recovery Program Attachment— County’s Response to Draft Audit Report Steve Westly • California State Controller State Controller’s Office Division of Audits Post Office Box 942850 Sacramento, California 94250-5874 http://www.sco.ca.gov S03-MCC-053