Report 2017-116 Recommendation 5 Responses

Report 2017-116: Community Child Care Council of Santa Clara County: Because It Disadvantaged Some Families and Misused State Funds, It Could Benefit From Increased Monitoring by the California Department of Education (Release Date: April 2018)

Recommendation #5 To: Community Child Care Council of Santa Clara County

To ensure that it can justify the costs for which it seeks reimbursement, 4Cs should, by October 2018, strengthen its controls over its approval of the expenditures it charges to the State's share of its funding. These controls should include retention of all documentation to justify appropriate approval of these expenditures.

6-Month Agency Response

The document retention policy was prepared on March 13, 2018 and implemented. Document retention process was revised May 18, 2018. Both Procurement and Expense policy and Documentation Retention policy are in full use agency-wide. An Internal Control Plan was developed and a Fiscal Department Training Plan created. Supporting Documentation: "Internal Control Plan"; "Documentation Retention Policy"; "Procurement and Expenses Policy"

California State Auditor's Assessment of 6-Month Status: Fully Implemented

4Cs provided documentation of its internal control plan and its new policies and procedures for procurement and document retention.

60-Day Agency Response

4C has worked towards strengthening its controls to ensure that the agency's costs are justified when seeking reimbursement. The fiscal department is utilizing a 4 step process to ensure that improvement is met (Development, Approval, Training and Implementation). The following outlines our continued process for strengthening controls:

Development of Policies - Jan 2018, our staff developed new policies and a monitoring checklist to enhance internal controls on procurement and expenses (ref 9-19). Our goal is to ensure that expenses are reasonable, allowable and allocable. Supporting documentation must be included prior to approvals.

Approval of Policies - On Feb 22, 2018, we presented to the Board an amendment to our procurement process along with the monitoring checklist.

Training to Management and Staff - Feb 22 and Mar 8, 2018 - CFO trained Board on Fiscal Processes (Ref: "Board of Directors - Fiscal Training - Approved Policies and Procedures.PDF"). Mar 13, 2018 - CFO trained GL Staff on updated Processes (Ref: "03.13.18 - GL Fiscal Staff Training (Approved Policies and Procedures).pdf"). May 11, 2018 -trained on procurement/expense at Manager's Meeting (Ref, "05.11.18 - Manager Meeting on Procurement. Pdf"). Fiscal will provide ongoing training to management.

Implementation - Mar 13, 2018 - Agency wide procurement and expense monitoring began. May 23, 2018 - Standard Operating Procedures (SOPs) are written to ensure that staff and agency retain all documents related to all purchases. SOPs are not required to be approved by Board. SOPs are currently in process (Ref: "4Cs - Fiscal - Corrective and Implantation - Reduction-Elimination of Provider Late Payment.pdf," pg 9-19)

Partial complete due to: Strengthening monitor check list of procurement and expenses. Greenbook training to management staffs. Review funding term and condition with management for allowable expenses. Document Retention is in process.

California State Auditor's Assessment of 60-Day Status: Partially Implemented

All Recommendations in 2017-116

Agency responses received are posted verbatim.