Audit of Training Contract Costs Claimed for Federal Reimbursement by the California Department of Social Services

This final audit report points out that the State agency allocated all costs incurred under a training contract to Federal programs only, although State programs also benefitted. As a result, the State's overclaim of Federal funds totaled $3.0 million. Also, the State claimed $0.9 million as in-kind matching costs that was improper because the matching funds were actually provided by a private third party. However, State officials provided evidence that approval had been obtained from the Administration for Children and Families (ACF) to do this, even though the approval was not in accordance with ACF policy. In addition to financial adjustments, we recommended procedural improvements to correct noted weaknesses.