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Report No. 2007-59
October 2007

Complete Audit Report

Unpaid Child Support Owed By Non-custodial Parents Is Often Incorrect

The Department of Social Services, through its Family Support Division (the division), oversees the collection of child support owed to custodial parents, and tracks the amount of unpaid child support (arrears). As of June 30, 2006, the division's computerized system showed approximately 240,000 IV-D cases had IV-D arrears totaling approximately $2.2 billion. Because of the importance of having accurate arrears information, we focused review efforts on determining (1) the accuracy of division records regarding arrears owed by non-custodial parents, and (2) the misstated amount and reasons for incorrect arrears balances.

Arrears often misstated

Incorrect arrears balances existed on approximately 27 percent of IV-D child support cases with arrears over $1,000, as of June 30, 2006. In addition, incorrect arrears balances existed on 22 of 35 cases reviewed that had arrears greater than $100,000 on that date. In total, overstatements ranged from approximately $1 to $455,000, and understatements ranged from approximately $10 to $55,000, on 79 of 244 cases reviewed.

Errors occurred on the cases with misstated balances because (1) obligations, judgments, payment or credits had not been recorded accurately or not at all; and (2) arrears balances transferred to the new computerized system in 1997 and 1998 were incorrect. (See page 5)

 

Errors and omissions caused inaccuracies

Our review disclosed arrears balances on 46 of 79 misstated cases occurred because (1) a judgment had not been recorded accurately, or not at all, (2) the obligation amount, or amount due, had not been recorded correctly, (3) division personnel had made errors when previously making adjustments to account balances on the Missouri Automated Child Support System (MACSS), (4) the pay history recorded on MACSS was incomplete or non-cash credits had not been recorded, and (5) the 10-year statute of limitations made some large amounts of arrears uncollectible. (See page 6)

 

Inaccurate data transferred to computerized system

Incorrect account balances occurred on 29 of 79 misstated cases because of errors at conversion. From 1997 through 1998, the division implemented a new computerized case management system. When automatically transferring case data on the old computer system to the new computerized system, account balances were transferred but the pay history detail remained on the old system. Therefore, if data entry errors or omissions causing a misstated arrears balance existed on the old system, the misstated balance would have been transferred to the new computerized system, and would have remained misstated until personnel reviewed the case file and records on the old computer system, and made corrections. (See page 8)

 

Incorrect arrears can cause improper or insufficient enforcement actions and affect federal reporting

Improper enforcement actions can be taken when arrears balances are overstated, and conversely, appropriate enforcement actions may not be used when arrears balances are understated. In addition, the department is required to report certain financial information annually to the federal Office of Child Support Enforcement that includes information on IV-D arrears. If the amount of unpaid child support reported is incorrect, it could affect the state's eligibility for incentive payments. (See page 10)

 

Not terminating judicial orders of support could cause arrears errors

Although state law and division policy set forth criteria to terminate judicial support orders, state law has not clearly identified who shall terminate those orders when support is no longer due. The division has taken the position that circuit court clerks have this responsibility. However, court clerks are no longer responsible for IV-D cases and opinions differ on who has that responsibility. (See page 11)

 

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Missouri State Auditor's Office
moaudit@auditor.mo.gov