FAC Explorer

Audit 18951

FY End
2022-12-31
Total Expended
$13.00M
Findings
2
Programs
14
Organization: Firelands Regional Health System (OH)
Year: 2022 Accepted: 2023-09-28
Auditor: Plante & Moran PLLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
23422 2022-001 Material Weakness - L
599864 2022-001 Material Weakness - L

Programs

ALN Program Spent Major Findings
93.498 Covid-19 - Provider Relief Fund and American Rescue Plan Rural Distribution $10.08M Yes 1
93.958 Block Grants for Community Mental Health Services $598,858 - 0
93.364 Nursing Student Loans $401,354 Yes 0
84.268 Federal Direct Student Loans $294,248 Yes 0
93.959 Block Grants for Prevention and Treatment of Substance Abuse $217,185 - 0
93.788 Opioid Str $213,733 - 0
93.667 Social Services Block Grant $150,800 - 0
93.461 Hrsa Covid-19 Claims Reimbursement for the Uninsured Program and the Covid-19 Coverage Assistance Fund $111,175 - 0
84.063 Federal Pell Grant Program $86,534 Yes 0
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $23,825 - 0
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $10,255 - 0
84.425 Covid-19 - Education Stabilization Fund $10,067 - 0
84.007 Federal Supplemental Educational Opportunity Grants $8,930 Yes 0
84.038 Perkins Loan Program $6,863 Yes 0

Contacts

Name Title Type
ELNNXPJJ9LF3 Kevin Riley Auditee
4195577797 Jordan Pace Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Firelands Single Audit (the System) under programs of the federal government for the year ended December 31, 2022. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the System, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the System. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement except for expenditures related to Assistance Listing Number (ALN) 93.498, Provider Relief Fund (PRF). PRF does not apply the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, but rather applies the U.S. Department of Health and Human Services guidance and frequently asked questions, as outlined in the Compliance Supplement. For the PRF program, the Department of Health and Human Services (HHS) has indicated that the amounts on the Schedule should be reported in correspondence with reporting requirements of the HHS PRF Reporting Portal. Payments from HHS for PRF are assigned to one of five payment received periods based upon the date each payment from PRF was received. Each period has a specified period of availability and timing of reporting requirement. The System elected to not use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Loans outstanding at the beginning of the year and loans made during the year are included in the federal expenditures presented in the schedule of expenditures of federal awards. The balances of loans outstanding at December 31, 2022 consist of the following: PERKINS LOAN PROGRAM (84.038) - Balances outstanding at the end of the audit period were 2310. NURSING STUDENT LOANS (93.364) - Balances outstanding at the end of the audit period were 328504. Subsequent to year end, the System began the process of liquidating the Federal Perkins Loan Program. Liquidation has been approved by the Department of Education and all loans have been assigned. There were no loan balances outstanding at the time the System began the process in July 2023. There was no federal share of the System's final fund capital from the Perkins Loan Program. Final liquidation has not yet been confirmed by the Department of Education, pending audit procedures as part of the single audit over the liquidation. Audit procedures have been performed over liquidation of the program as part of the single audit over the Student Financial Assistance cluster major program.

Finding Details

Finding 2022-001
Assistance Listing Number, Federal Agency, and Program Name 93.498, U.S. Department of Health and Human Services, COVID 19 Provider Relief Fund and American Rescue Plan Rural Distribution Federal Award Identification Number and Year N/A Pass through Entity N/A Finding Type Material weakness and material noncompliance with laws and regulations Repeat Finding No Criteria The System must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The reporting requirements for the Provider Relief Fund (PRF) requires recipients that apply PRF payments toward lost revenue to use one of the following options for calculating lost revenue: Option i: The different between actual patient care revenue Option ii: The difference between budgeted (prior to March 27, 2020) and actual patient care revenue Option iii: The amount calculated by any reasonable method of estimating revenue Condition The System does not have a formal review process to ensure the revenue reported within the PRF reporting submissions properly reconciles to the underlying financial statements. The System selected Option i for reporting lost revenues, however the actual revenue reported for each quarter of 2022 did not reconcile to the underlying accounting records. Questioned Costs None Identification of How Questioned Costs Were Computed N/A Context There was no independent review of the actual revenue for 2022 reported within the PRF reporting portal to evaluate the completeness and accuracy of the data used in the calculation of lost revenue. The quarterly totals reported for 2022 actual revenue were each misstated as the revenue accrual was not included in the figures reported in the portal. This resulted in the over reporting of lost revenues by approximately $360,000 for 2022. Cause and Effect The lack of an independent review of the reporting submission resulted in a reporting error and could also result in an increased risk of incomplete or inaccurate information reported to the granting agency. Recommendation The System should implement a process to ensure an independent review of the reporting submission is completed prior to finalization. Views of Responsible Officials and Corrective Action Plan Management will implement a process to ensure an independent review of the reporting submission is completed prior to submission. The lost revenue reported in the period four portal submission was overstated by approximately $360,000 as a result of the error identified. The System had excess lost revenue that did not have to be utilized to justify recognition of the funding received, therefore this error had no impact on meeting the conditions of the funding received.
Finding 2022-001
Assistance Listing Number, Federal Agency, and Program Name 93.498, U.S. Department of Health and Human Services, COVID 19 Provider Relief Fund and American Rescue Plan Rural Distribution Federal Award Identification Number and Year N/A Pass through Entity N/A Finding Type Material weakness and material noncompliance with laws and regulations Repeat Finding No Criteria The System must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The reporting requirements for the Provider Relief Fund (PRF) requires recipients that apply PRF payments toward lost revenue to use one of the following options for calculating lost revenue: Option i: The different between actual patient care revenue Option ii: The difference between budgeted (prior to March 27, 2020) and actual patient care revenue Option iii: The amount calculated by any reasonable method of estimating revenue Condition The System does not have a formal review process to ensure the revenue reported within the PRF reporting submissions properly reconciles to the underlying financial statements. The System selected Option i for reporting lost revenues, however the actual revenue reported for each quarter of 2022 did not reconcile to the underlying accounting records. Questioned Costs None Identification of How Questioned Costs Were Computed N/A Context There was no independent review of the actual revenue for 2022 reported within the PRF reporting portal to evaluate the completeness and accuracy of the data used in the calculation of lost revenue. The quarterly totals reported for 2022 actual revenue were each misstated as the revenue accrual was not included in the figures reported in the portal. This resulted in the over reporting of lost revenues by approximately $360,000 for 2022. Cause and Effect The lack of an independent review of the reporting submission resulted in a reporting error and could also result in an increased risk of incomplete or inaccurate information reported to the granting agency. Recommendation The System should implement a process to ensure an independent review of the reporting submission is completed prior to finalization. Views of Responsible Officials and Corrective Action Plan Management will implement a process to ensure an independent review of the reporting submission is completed prior to submission. The lost revenue reported in the period four portal submission was overstated by approximately $360,000 as a result of the error identified. The System had excess lost revenue that did not have to be utilized to justify recognition of the funding received, therefore this error had no impact on meeting the conditions of the funding received.