EXECUTIVE SUMMARY:

Our objectives were to determine whether the Wisconsin Department of Workforce Development (State agency) appropriately reported program income for undistributable child support collections and interest earned on program funds.  For the quarters ended December 1998 through September 2005, the State agency did not recognize and report program income of $162,701 ($107,383 Federal share) for undistributable collections.  The State agency properly reported interest earned on program funds as program income.  We recommended that the State agency make the appropriate program income adjustments for undistributable collections, require the Milwaukee agency to transfer unclaimed collections to the treasurer's office and implement adequate policies and procedures to ensure future undistributable collections are recognized as program income on Federal financial reports.  The State agency agreed with the audit recommendations.