|Financial Audit Division Report 17-10||Released March 24, 2017|
We audited the Department of Employment and Economic Development’s use of money it received in fiscal year 2016 through two large federal grant programs, including Unemployment Insurance, and Rehabilitation Services – Vocational Rehabilitation Grants.
Our primary objectives were: (1) to determine whether the department used federal grant money and administered the programs in compliance with federal regulations; and (2) to determine whether the department had adequate internal controls to ensure it complied with federal requirements.
For each federal program, we interviewed officials and staff of the Department of Employment and Economic Development to understand how the department administered the federal programs and ensured compliance. We analyzed the financial transactions of each program and, as necessary, tested a sample of those transactions to determine whether the department’s internal controls were effective and to ensure the transactions complied with federal requirements.
We concluded that the Department of Employment and Economic Development generally complied with most federal grant requirements for its large federal programs for fiscal year 2016. The department also generally had adequate internal controls to ensure compliance with those requirements. However, the department had two instances of noncompliance and internal control weaknesses, including one finding repeated from our prior federal compliance report,1 as noted in the findings in this report.
1 Office of the Legislative Auditor, Financial Audit Division Report 16-11, Department of Employment and Economic Development Federal Compliance Audit, (Finding 1), issued March 24, 2016.