Bryan Connell, Director (573) 751-8041
Office of Audit Services (OAS) is one of the units within the Office of the Director. We are based in Jefferson City and serve as the internal audit function for Department of Mental Health (DMH). The vast majority of our audits deal primarily with contract compliance.
We provide assistance to the three DMH operating divisions (Division of Mental Illness, Division of Alcohol and Drug Abuse, and Division of Developmental Disabilities), and to other support sections, by conducting audits and consultations on DMH-operated facilities and private contract agencies. Additionally, we serve as the liaison between DMH and the State Auditor's Office, and review independent audits of those few providers required to file independent audits with DMH.
Once a DMH-operated facility or private contract agency has been selected for review, we will contact the entity (referred to as the auditee) to explain what our review will entail, and to set up a mutually agreeable date to start the review. Upon arrival, we will meet with appropriate auditee staff to discuss the review, determine which staff to contact for documentation requests or questions, and answer questions the auditee may have.
In conducting our review, we may initially select only a sample of transactions for a particular period. However, it may be necessary to expand our review depending on the results of that initial review. Once we believe our on-site work has been completed, we will meet with appropriate auditee staff to discuss in general terms the results of our review to date. After this meeting, we will return to Jefferson City to complete any remaining audit work. It is possible that we may need to return to the auditee site if additional information or records are needed.
Once audit work has been completed, we will prepare a draft report of audit findings which include recommendations designed to reduce the potential for discrepancies in the future. This document is forwarded to appropriate DMH management, who can either choose to meet with us to discuss the report or approve the report for distribution. When approval for distribution of the draft report has been granted, a copy of the draft report will be forwarded to the auditee.
Upon receipt of the draft report, the auditee may either respond in writing to the individual findings and recommendations, or schedule an exit conference with us to discuss the findings and recommendations. After the auditee has responded in writing to the draft report, the auditee's responses will be incorporated into the final audit report, which is then distributed to the aforementioned parties and the State Auditor's Office.
DMH itself does not have a requirement that private contract agencies obtain an independent audit. However, there is a federal audit requirement that DMH must enforce. This requirement affects approximately 25 of DMH's private contract agencies.
A portion of the funds DMH uses to pay private contract agencies comes from federal grants. One of the requirements of those grants is that DMH monitor the amount of federal grant funds paid by DMH to each private contract agency. If federal grant funds from DMH total $500,000 or more for your agency's fiscal year, your agency will be required to have an independent audit conducted by a CPA, and to send a copy of that independent audit to us. The requirement to have an independent audit, and the basic steps to follow in conducting the audit, are outlined in federal Office of Management and Budget (OMB) Circular A-133.
Your agency cannot determine the source of funds paid by DMH. We monitor the payments from federal grant funds, and if they total $500,000 or more for your agency's fiscal year, we will send a letter around the end of your agency's fiscal year indicating that your agency is required to have an independent audit conducted in accordance with OMB Circular A-133, and to file a copy of the independent audit with us. Approximately six weeks later, we will send another letter containing the amount of federal grant funds your agency received during the fiscal year. As specified in OMB Circular A-133, the due date for filing the independent audit with us is nine months after the end of your agency's fiscal year. Because this is a federal requirement, no extensions of time can be granted.
Many private contract agencies receive payments through Medicaid Waiver, CPR, CSTAR, or other Medicaid programs administered by DMH. Although Medicaid is funded in part by the federal government, Medicaid is considered an individual benefit rather than a grant. Accordingly, the amounts your agency receives through Medicaid programs are not counted in determining whether your agency received $500,000 or more in federal grant funds.
State Auditor's Office Liaison
By statute, the State Auditor's Office (SAO) is empowered to conduct audits of all State agencies, including DMH. To help achieve effective and efficient communication between the SAO and DMH, the OAS Director has been designated as the official liaison between the two agencies. The OAS Director serves as the central contact point for all questions, notifications, and requests for information from the SAO, and is involved in preparing or reviewing correspondence or other communications with the SAO. The OAS Director also reviews all SAO draft reports on audits of DMH facilities, and provides advice concerning a facility's response to any findings contained in the draft report. Completed audits of the Department by the SAO can be found at www.auditor.mo.gov. Follow the links first to "Audit Reports" and then to "Department of Mental Health".