Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program) Ascension Ministry Market: Various Pass-Through Award Numbers: Various Pass-Through Award Period of Performance: 07/01/2021?06/30/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Health and Human Services (HHS) ? Health Resources and Services and Administrative (HRSA) issued Terms and Conditions for Participation in the HRSA COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured Program (T&Cs) outlining requirements that recipients of funding from the HRSA COVID-19 Uninsured Program must comply with, including the following sections: Testing Services, Treatment Services and Vaccine Administration, and General Provisions in FY2020 Consolidated Appropriations. Per the HRSA T&Cs (for COVID-19 testing and testing-related items): ?FFCRA Uninsured Individuals means individuals who, as of the date of service for which Recipient seeks Payment, are not enrolled in? ? A Federal health care program (as defined under section 1128B(f) of the Social Security Act (42 U.S.C. 1320a-7b(f)), including an individual who is eligible for medical assistance only because of subsection (a)(10)(A)(ii)(XXIII) of Section 1902 of the Social Security Act; or ? A group health plan or health insurance coverage offered by a health insurance issuer in the group or individual market (as such terms are defined in section 2791 of the Public Health Service Act (42 U.S.C. 300gg-91)), or a health plan offered under chapter 89 of title 5, United States Code.? Per the HRSA T&Cs (for COVID-19 treatment): Uninsured individuals are ?individuals who do not have any health care coverage at the time the services were provided.? Under the HRSA T&Cs, ?the Recipient certifies that it will not engage in ?balance billing? or charge any type of cost sharing for any items or services provided to Uninsured Individuals receiving a COVID-19 testing and/or testing related items, vaccination or care or treatment for a positive diagnosis of COVID-19 for which the Recipient receives a Payment from the Uninsured Program Fund. The Recipient must not sell or seek reimbursement from an Uninsured Individual for any COVID-19 vaccine and any adjuvant, syringes, needles, or other constituent products and ancillary supplies that the federal government provides at no cost to the Recipient. The Recipient shall consider Payment received from the Uninsured Program Fund to be payment in full for such COVID-19 testing and/or testing-related items, vaccine administration, care, or treatment.? Condition: Ascension Health Alliance d/b/a Ascension (the System) did not retain supporting documentation over the Uninsured COVID-19 report query logic (the Report) that was developed to identify patients who meet the allowability and eligibility requirements of the federal program. In addition, supporting documentation was not retained to validate who had access to modify the script, what changes were made to the script, and how the changes to the script were tested and implemented during the entirety of the fiscal year based on changes to HRSA guidance. Further, management did not maintain supporting documentation to demonstrate how it validated the completeness and accuracy of the data extracted by the script. Furthermore, in certain instances, the System billed HRSA and received payments for claims that were not allowable under the Uninsured Program, including instances where the patient had health insurance. In addition, we noted that the System?s statement-hold internal control, which is placed on each account that has COVID-19 diagnosis and uninsured status to prevent billing of the patient, was not operating consistently for all patient accounts billed under the Uninsured Program during the fiscal year. Cause: Development of the Report occurred outside of the Information Technology (IT) department that would require a formal process for the development of IT reports, access, and program changes; the Report resided in the Revenue Cycle department. The Revenue Cycle department did not develop internal control over program changes and user access. In addition, while management represented that the Report?s logic and subsequent changes to the Report?s logic were reviewed, no audit evidence was retained to support that process. The System billing departments did not have robust processes in place over the review for allowability and eligibility for the Uninsured Program, including identification of health insurance coverage. The statement hold control was not properly designed to include a statement hold on all patient accounts billed under the Uninsured Program. Effect or potential effect: The Report used to identify eligible federal program participants could be inaccurate or incomplete. Claims were submitted and reimbursed by HRSA for patients who had independent health insurance or the service was not supported by underlying medical records. A patient may be inappropriately billed for any outstanding balance remaining after HRSA payment. Questioned costs: COVID-19 Assistance Listing No. 93.461 ? $8,972. Context: For three claims with total payments of $8,972 out of 60 claims sampled with total payments of $396,317, we noted the following: ?For two of the claims, the patients were not uninsured at the time the claim was submitted to HRSA. The claims were submitted to HRSA and payment was received. ?For one of the claims, there was no evidence that COVID-19 was the primary diagnosis. The claim was submitted to HRSA and the payment was received. For seven claims with total payments of $97,340 out of 60 claims sampled with total payments of $396,317, we noted deficiencies in the design and operating effectiveness of the System?s statement hold internal control. For these seven claims, no statement hold was placed on the account. Total federal expenditures for Assistance Listing 93.461 totaled $39,064,571 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: A part of this finding is a repeat of Finding 2021-001 from the prior year. Recommendation: Should the federal program be reinstated by the U.S. Department of Health and Human Services (HHS), the System should implement internal controls related to access and change management over the Report. In addition, the System should implement more robust procedures to validate that the patient billed meets the allowability and eligibility requirements of the HRSA Uninsured Program, including sufficient review of health insurance coverage. Furthermore, the System should assess the internal controls over the balance billing requirement under the federal program to ensure it is designed properly and operating effectively. Views of responsible officials: The Uninsured Program administered by HHS stopped accepting claims due to lack of funding. All claims for testing or treatment had a deadline of March 22, 2022; thus, no further action plan is needed. Any patient accounts billed in error have been refunded to HRSA.
Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Ascension Ministry Market: Various Tax Identification Numbers: Various Payment Received Period: 07/01/2020?12/31/2020 (Period 2) and 01/01/2021?06/30/2021 (Period 3) Deadline to Use Funds: June 30, 2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the award require the recipient to submit reports as the secretary of HHS determines are needed to ensure compliance with conditions that are imposed on the payment, and such reports shall be in such form, with such content, as specified by the secretary of HHS in future program instructions directed to all recipients. Condition: Evidence of management?s review of the Periods 2 and 3 Provider Relief Fund (PRF) Reports was not retained related to adjustments to net patient service revenue (NPSR) for out-of-period transactions used in the lost revenue calculations.In addition, supporting documentation was not consistently retained to support the allowability of adjustments for out-of-period transactions made to NPSR used in the lost revenue calculations. Cause: Management did not have suitably designed internal controls to ensure that all adjustments to NPSR for out-of-period transactions were reconciled to the final lost revenue calculations. Effect or potential effect: The lost revenue calculations could be inaccurate or incomplete. Questioned costs: None. Context: We tested 21 of 127 Periods 2 and 3 PRF Reports submitted to HRSA. We tested 8 of 44 adjustments that related to our selected 21 PRF Reports. For 2 of the 8 adjustments tested, the out-of-period adjustment to NPSR was incorrect. The effect on NPSR and lost revenues for these findings is as follows (see Schedule of Findings and Questioned Costs for chart/table). Total federal expenditures for Assistance Listing 93.498 reported in the schedule of expenditures of federal awards totaled $687,514,438 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is a repeat of Finding 2021-002 from the prior year. Recommendation: The System should ensure internal controls over the review of PRF Reports are enhanced to include testing of adjustments to NPSR used in the lost revenue calculations for proper supporting documentation. Views of responsible officials: Ascension completed a review on September 30, 2022 of the NPSR adjustments file to the detailed lost revenue calculation file and saved a final copy of the NPSR adjustments file to prevent further revisions. Ascension had significant excess unused loss revenues to cover the impact of the NPSR adjustment errors identified and is still able to support funding received. Ascension updated the loss revenue calculation file to reflect the corrected NPSR adjustments that will be used for future PRF Reporting. Ascension will input the corrected loss revenue calculations for all unsupported adjustments in Report Period 4 due March 31, 2023.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Pass-Through Grantor: Michigan Health & Hospital Association Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: The System has an internal control to review the accuracy of the suspension and debarment search results performed by its third-party contractor. The internal control was not performed over a new third-party contractor that was used for two months of fiscal year 2022. Cause: During fiscal year 2022, the System changed its third-party contractor beginning May 2022. The third-party contractor does not have a SOC 1 (System and Organization Controls Report) report that covers the suspension and debarment services provided. Management did not perform testing over the results of the third-party contractor to assess the accuracy of its procedures. Effect or potential effect: Suspension and debarment results provided by the third-party contractor may not be accurate. As a result, federal funds may be used to pay a contractor that is suspended or debarred. Questioned costs: None. Context: For Assistance Listing No. 21.027, the federal portion of procurement expenditures subject to suspension and debarment review totaled $1,636,000, which represents approximately 5.4% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System?s independent testing of the internal controls performed by the third-party contractor to ensure they are functioning as designed, inclusive of all contractors and subcontractors, and the results provided by the third-party contract are consistent with the System?s expectations, should be reevaluated when there are changes in facts and circumstances, such as a change in third-party contractors. Views of responsible officials: Effective February 1, 2023, Ascension has formally updated its documented procedures related to this key internal control. These procedures now provide specific guidance to address the impact of a change in third-party contractors.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the pass-through agreements with the states required the submission of the following special reports during the fiscal year:(see Schedule of Findings and Questioned Cost for chart/table). Condition: The Policy 3 Financial Reports required by the State of Tennessee Department of Health were not submitted timely for certain time periods during fiscal year 2022. Cause: Internal controls were not in place to monitor the due dates for submission of special reports under the pass-through agreement with the State of Tennessee Department of Health. Effect or potential effect: The System may not be in compliance with the terms and conditions of the federal program reporting requirements. Questioned costs: None. Context: We sampled 9 special reports out of a population of 51 required to be submitted under the federal program for the System?s Kansas, Michigan, and Tennessee locations. Two of the nine (22%) special reports were not submitted timely. The quarterly special reports that were due on October 31, 2021, and January 30, 2022, were both submitted to the State of Tennessee Department of Health on April 4, 2022. For Assistance Listing No. 21.027, expenditures for the Tennessee location were $4,135,064, which represents approximately 13.6% of total federal expenditures of $30,499,780 reported in the SEFA for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: The System should implement an internal control over the monitoring of due dates of all reports required to be submitted under the federal program to ensure they are submitted timely. Views of responsible officials: As of February 1, 2023, Ascension has implemented a team calendar that tracks due dates of all reports required to be submitted under federal programs. This calendar is accessible to all team members, including management, for oversight and accountability.
Information of the federal program: Federal Grantor: United States Department of the Treasury Assistance Listing No.: 21.027, COVID-19 Coronavirus State and Local Fiscal Recovery Funds Pass-Through Grantor: State of Tennessee Department of Health Ascension Ministry Market: Tennessee Pass-Through Award Number: 34352-93122, 34352-90022, 34352-69822 Pass-Through Award Period: 07/06/2021?Ongoing Pass-Through Grantor: Michigan Health & Hospital Association Ascension Ministry Market: Michigan Pass-Through Award Number: Not applicable Pass-Through Award Period: 12/01/2021?09/30/2023 Pass-Through Grantor: Kansas Department of Health & Environment Ascension Ministry Market: Kansas Pass-Through Award Number: Not applicable Pass-Through Award Period: 09/01/2021?02/28/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The Uniform Guidance 2 CRF Subpart E section 200.403 states the following: ?Costs must meet the following general criteria in order to be allowable under Federal awards: (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity; and (g) be adequately documented.? Condition: Tennessee and Michigan ? Time cards for employees that were submitted for substantiation of funding for the federal program were not consistently evidenced as reviewed and approved. Kansas ? Evidence of management?s review for allowability and period of performance of expenses to be submitted to the State of Kansas was not retained. Michigan ? To determine the cost for contract labor, the System used an average contract labor rate, which is not consistent with policies and procedures for the cost of contract labor for other activities of the entity. In addition, management?s calculation of the average contract labor rate did not take into consideration all the contractor labor agreements. Cause: Tennessee and Michigan ? Time cards were processed without manager approval. Kansas ? Management did not have a requirement to retain the supporting documentation evidencing the approval of expenses to be submitted to the state. Michigan ? The System did not have an internal control in place to review the appropriateness of the average contract labor rate used and to ensure that adequate documentation is retained. Effect or potential effect: The System may incur unallowable expenses or not be in compliance with the terms and conditions of the federal program, including relevant cost principles. Questioned costs: None. Context: Tennessee and Michigan ? For 2 (totaling $905) of 35 (totaling $19,844) (4.6%) payroll transactions sampled during the fiscal year, the employees? time cards did not have evidence of review and approval by the employees? manager. For Assistance Listing No. 21.027, total payroll costs for the Tennessee and Michigan locations were $16,317,658, representing 54% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Kansas ? For Assistance Listing No. 21.027, total payroll and benefits expenses for Kansas were $9,109,616, representing 30% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Michigan ? We sampled 40 expenses (totaling $27,337) that were submitted to the states under the federal program. For 4 expenses (totaling $4,115) out of 40 (10%) that related to the Michigan location, the documentation supporting the average rate used to apply to contract labor hours claimed was not maintained. Furthermore, the analysis, subsequently provided, used contract labor data from only one vendor, instead of the three contractors utilized by the Michigan location. In addition, the average rate is not a standard practice of the System to determine the cost of contract labor. Instead, the contract labor cost is determined by invoiced amounts in the normal course of business. For Assistance Listing No. 21.027, expenditures for contract labor for the Michigan location were $1,636,000, representing 5.4% of total federal expenditures of $30,499,780 for the year ended June 30, 2022. Tennessee, Michigan, and Kansas federal expenditures totaled $4,135,064, $16,800,000, and $9,240,916, respectively, representing 14%, 55%, and 30%, respectively, of total federal expenditures for Assistance Listing No. 21.027 of $30,499,780 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is not a repeat finding from the prior year. Recommendation: Tennessee and Michigan ? The System should reinforce the importance of adhering to its internal controls over the review and approval of time cards. Kansas ? The System should formalize the review and approval process of program expenses by authorized individuals that would include retention of evidence of the review, including documentation of the elements of the review process validated by the reviewer. Michigan ? The System should implement internal controls over the review and approval of the average contract labor rate, including the retention of adequate documentation. Views of responsible officials: Ascension will reinforce internal controls over review and approval of time cards and retention of documentation evidencing the approval of expenses. The use of the average labor contract rate was a conservative approach as Ascension?s actual average labor rate was higher than the average $150 per hour expensed to the grant. Ascension will reevaluate the methodology and appropriateness of use of an average contractor labor rate for contract labor reimbursement.
Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.461, COVID-19 HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program) Ascension Ministry Market: Various Pass-Through Award Numbers: Various Pass-Through Award Period of Performance: 07/01/2021?06/30/2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Health and Human Services (HHS) ? Health Resources and Services and Administrative (HRSA) issued Terms and Conditions for Participation in the HRSA COVID-19 Claims Reimbursement to Health Care Providers and Facilities for Testing, Treatment, and Vaccine Administration for the Uninsured Program (T&Cs) outlining requirements that recipients of funding from the HRSA COVID-19 Uninsured Program must comply with, including the following sections: Testing Services, Treatment Services and Vaccine Administration, and General Provisions in FY2020 Consolidated Appropriations. Per the HRSA T&Cs (for COVID-19 testing and testing-related items): ?FFCRA Uninsured Individuals means individuals who, as of the date of service for which Recipient seeks Payment, are not enrolled in? ? A Federal health care program (as defined under section 1128B(f) of the Social Security Act (42 U.S.C. 1320a-7b(f)), including an individual who is eligible for medical assistance only because of subsection (a)(10)(A)(ii)(XXIII) of Section 1902 of the Social Security Act; or ? A group health plan or health insurance coverage offered by a health insurance issuer in the group or individual market (as such terms are defined in section 2791 of the Public Health Service Act (42 U.S.C. 300gg-91)), or a health plan offered under chapter 89 of title 5, United States Code.? Per the HRSA T&Cs (for COVID-19 treatment): Uninsured individuals are ?individuals who do not have any health care coverage at the time the services were provided.? Under the HRSA T&Cs, ?the Recipient certifies that it will not engage in ?balance billing? or charge any type of cost sharing for any items or services provided to Uninsured Individuals receiving a COVID-19 testing and/or testing related items, vaccination or care or treatment for a positive diagnosis of COVID-19 for which the Recipient receives a Payment from the Uninsured Program Fund. The Recipient must not sell or seek reimbursement from an Uninsured Individual for any COVID-19 vaccine and any adjuvant, syringes, needles, or other constituent products and ancillary supplies that the federal government provides at no cost to the Recipient. The Recipient shall consider Payment received from the Uninsured Program Fund to be payment in full for such COVID-19 testing and/or testing-related items, vaccine administration, care, or treatment.? Condition: Ascension Health Alliance d/b/a Ascension (the System) did not retain supporting documentation over the Uninsured COVID-19 report query logic (the Report) that was developed to identify patients who meet the allowability and eligibility requirements of the federal program. In addition, supporting documentation was not retained to validate who had access to modify the script, what changes were made to the script, and how the changes to the script were tested and implemented during the entirety of the fiscal year based on changes to HRSA guidance. Further, management did not maintain supporting documentation to demonstrate how it validated the completeness and accuracy of the data extracted by the script. Furthermore, in certain instances, the System billed HRSA and received payments for claims that were not allowable under the Uninsured Program, including instances where the patient had health insurance. In addition, we noted that the System?s statement-hold internal control, which is placed on each account that has COVID-19 diagnosis and uninsured status to prevent billing of the patient, was not operating consistently for all patient accounts billed under the Uninsured Program during the fiscal year. Cause: Development of the Report occurred outside of the Information Technology (IT) department that would require a formal process for the development of IT reports, access, and program changes; the Report resided in the Revenue Cycle department. The Revenue Cycle department did not develop internal control over program changes and user access. In addition, while management represented that the Report?s logic and subsequent changes to the Report?s logic were reviewed, no audit evidence was retained to support that process. The System billing departments did not have robust processes in place over the review for allowability and eligibility for the Uninsured Program, including identification of health insurance coverage. The statement hold control was not properly designed to include a statement hold on all patient accounts billed under the Uninsured Program. Effect or potential effect: The Report used to identify eligible federal program participants could be inaccurate or incomplete. Claims were submitted and reimbursed by HRSA for patients who had independent health insurance or the service was not supported by underlying medical records. A patient may be inappropriately billed for any outstanding balance remaining after HRSA payment. Questioned costs: COVID-19 Assistance Listing No. 93.461 ? $8,972. Context: For three claims with total payments of $8,972 out of 60 claims sampled with total payments of $396,317, we noted the following: ?For two of the claims, the patients were not uninsured at the time the claim was submitted to HRSA. The claims were submitted to HRSA and payment was received. ?For one of the claims, there was no evidence that COVID-19 was the primary diagnosis. The claim was submitted to HRSA and the payment was received. For seven claims with total payments of $97,340 out of 60 claims sampled with total payments of $396,317, we noted deficiencies in the design and operating effectiveness of the System?s statement hold internal control. For these seven claims, no statement hold was placed on the account. Total federal expenditures for Assistance Listing 93.461 totaled $39,064,571 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: A part of this finding is a repeat of Finding 2021-001 from the prior year. Recommendation: Should the federal program be reinstated by the U.S. Department of Health and Human Services (HHS), the System should implement internal controls related to access and change management over the Report. In addition, the System should implement more robust procedures to validate that the patient billed meets the allowability and eligibility requirements of the HRSA Uninsured Program, including sufficient review of health insurance coverage. Furthermore, the System should assess the internal controls over the balance billing requirement under the federal program to ensure it is designed properly and operating effectively. Views of responsible officials: The Uninsured Program administered by HHS stopped accepting claims due to lack of funding. All claims for testing or treatment had a deadline of March 22, 2022; thus, no further action plan is needed. Any patient accounts billed in error have been refunded to HRSA.
Information of the federal program: Federal Grantor: United States Department of Health and Human Services, Health Resources and Services Administration (HRSA) Assistance Listing No.: 93.498, COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Ascension Ministry Market: Various Tax Identification Numbers: Various Payment Received Period: 07/01/2020?12/31/2020 (Period 2) and 01/01/2021?06/30/2021 (Period 3) Deadline to Use Funds: June 30, 2022 Criteria or specific requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? The terms and conditions of the award require the recipient to submit reports as the secretary of HHS determines are needed to ensure compliance with conditions that are imposed on the payment, and such reports shall be in such form, with such content, as specified by the secretary of HHS in future program instructions directed to all recipients. Condition: Evidence of management?s review of the Periods 2 and 3 Provider Relief Fund (PRF) Reports was not retained related to adjustments to net patient service revenue (NPSR) for out-of-period transactions used in the lost revenue calculations.In addition, supporting documentation was not consistently retained to support the allowability of adjustments for out-of-period transactions made to NPSR used in the lost revenue calculations. Cause: Management did not have suitably designed internal controls to ensure that all adjustments to NPSR for out-of-period transactions were reconciled to the final lost revenue calculations. Effect or potential effect: The lost revenue calculations could be inaccurate or incomplete. Questioned costs: None. Context: We tested 21 of 127 Periods 2 and 3 PRF Reports submitted to HRSA. We tested 8 of 44 adjustments that related to our selected 21 PRF Reports. For 2 of the 8 adjustments tested, the out-of-period adjustment to NPSR was incorrect. The effect on NPSR and lost revenues for these findings is as follows (see Schedule of Findings and Questioned Costs for chart/table). Total federal expenditures for Assistance Listing 93.498 reported in the schedule of expenditures of federal awards totaled $687,514,438 for the year ended June 30, 2022. Identification as a repeat finding, if applicable: The finding is a repeat of Finding 2021-002 from the prior year. Recommendation: The System should ensure internal controls over the review of PRF Reports are enhanced to include testing of adjustments to NPSR used in the lost revenue calculations for proper supporting documentation. Views of responsible officials: Ascension completed a review on September 30, 2022 of the NPSR adjustments file to the detailed lost revenue calculation file and saved a final copy of the NPSR adjustments file to prevent further revisions. Ascension had significant excess unused loss revenues to cover the impact of the NPSR adjustment errors identified and is still able to support funding received. Ascension updated the loss revenue calculation file to reflect the corrected NPSR adjustments that will be used for future PRF Reporting. Ascension will input the corrected loss revenue calculations for all unsupported adjustments in Report Period 4 due March 31, 2023.