Audit of Kentucky's Title IV-E Training Costs

EXECUTIVE SUMMARY:

Our objective was to determine the allowability of Title IV-E training costs the State agency claimed for the period April 1, 2001, through March 31, 2003.  The State agency did not always follow Federal regulations regarding allowability of Eastern Kentucky University (EKU) and other Title IV-E training costs.  These deficiencies occurred because the State agency:  (1) was not always aware of Title IV-E laws, regulations, and program policies and (2) did not have adequate procedures to ensure that it claimed only eligible training costs.

We recommended the State agency:  (1) reduce reported Federal reimbursement by $1,063,743 (Federal share) for training courses provided by EKU, (2) work with the Administration for Children and Families (ACF) to determine the allowable portion of  $9.7 million (Federal share) in both EKU training costs ($2.6 million) and State agency employee salaries and fringe benefits ($7.1 million) allocated to the Title IV-E program and (3) develop additional procedures.  State agency officials agreed to return $484,910 of the $1,063,743 (Federal share), work with ACF to determine the allowable portion of costs we set aside, and implement and maintain additional procedures.