06-30019-03

Purpose of the Report

In accordance with Title 24 of the Alaska Statutes and a special request by the Legislative Budget and Audit Committee, we conducted an audit of travel issues at the Division of Family and Youth Services (DFYS). The objectives of this audit were:

• To review DFYS’ processes for approving, paying, and recording state and federally-funded, client-related travel expenditures. Client-related travel includes travel for children under DFYS oversight, employee and nonemployee escort travel, and family travel.
• To evaluate the effectiveness of internal controls over the above processes.
• To evaluate DFYS’ compliance with statewide, department, and division travel policies and procedures.
• To review the travel credit card systems used by the division to procure client-related travel.

Report Conclusions

Our primary finding was that current procedures and internal controls are inadequate to control client-related travel costs. The four DFYS regions of the State do not follow the same guidelines and procedures for procuring travel.

Specifically, we concluded:

• The DFYS Travel Authorization and Request for Funds approval process is lengthy, time-consuming, and costly to the division.
• Management review does not adequately control travel costs.
• Practices do not comply with current travel policies and procedures.
• Email communications may not adequately safeguard client information.

Findings and Recommendations

1. The DFYS director should redesign and simplify the division’s travel processes.Current policies and procedures are inadequate to control travel costs. The travel request approval process should be simplified. Travel clerks, rather than social workers, should make travel arrangements. Internal controls over travel costs should be amended. All four DFYS regions should follow department and division travel policies and procedures. The policy requiring the State to pay transportation costs for foster children to accompany their foster family on vacation should be clarified.Simplified processes for ticket purchases will enable the division to greatly increase its use of advance purchase airline fares. Our testing of 132 trips showed that 67 percent of the expenditures were for nonemergency, full-fare tickets. We conservatively estimated the potential savings for the division at $650,000 per year.
2. The DFYS director should determine if additional safeguards over confidential client information communications are necessary.State and federal policies require DFYS to protect client information. The use of email by DFYS staff may compromise that confidentiality as we noted the use of client names and medical needs in email messages sent between division staff. DFYS should consult with the Department of Administration, Information Technology Group, to determine if additional security measures are needed to prevent unauthorized access to electronic client information.This issue may also affect other divisions in the Department of Health and Social Services. The Health Insurance Portability and Accountability Act of 1996 (also known as HIPPA) requires security and privacy of health information. The Divisions of Medical Assistance and Public Health may also need to have additional safeguards placed over their confidential information.