Audit of Overpayment Recoveries Pertaining to the Aid to Families With Dependent Children Program Administered by the State of Alabama

EXECUTIVE SUMMARY:

The objective of this audit was to determine whether the State had established systems and procedures to properly monitor, report, identify, collect and write-off Aid to Families with Dependent Children (AFDC) overpayments; and to evaluate the adequacy of the systems and procedures in place to assure that overpayments were processed accurately, timely, and in compliance with Federal regulations.  The State's systems and procedures appeared adequate to assure that overpayments were processed accurately, timely, and in compliance with Federal regulations.  However, for the period April 1, 1997 through March 31, 2001, the State included Temporary Assistance to Needy Families (TANF) overpayment recoveries totaling $77,742 in the AFDC overpayment amount returned to the Administration for Children and Families (ACF).  The State should have retained the Federal share of TANF overpayment recoveries for use in funding the TANF program.  This problem occurred because of computer programming errors discovered in two of the State's reporting systems.  We recommended that the State correct its reporting systems and make an adjustment for the recoupments refunded to ACF in error.  State officials agreed with our findings and recommendations.