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EXECUTIVE SUMMARY:
The objective of this audit was to determine if the administrative costs claimed by Nebraska were allocable and allowable in accordance with applicable laws, regulations, and program policies. We found Nebraska overcharged the Foster Care IV-E program $1,137,031 (Federal share) in adjustments to prior periods and $3,198,511 (Federal share) for costs incurred. Specifically, Nebraska: (1) overstated adjustments for prior periods because they used an incomplete, non-statistical case review process to reclassify foster care children as IV-E eligible; (2) allocated costs to the IV-E program that did not relate to foster care children; (3) did not allocate allowable costs for foster care licensing to the IV-E program (this resulted in an under claim); and (4) used allocation procedures that were outdated or not in accordance with their cost allocation plan. We recommended financial adjustments and procedural corrections.