Audit 295716

FY End
2022-12-31
Total Expended
$3.30M
Findings
2
Programs
2
Organization: Claxton Hepburn Medical Center (NY)
Year: 2022 Accepted: 2024-03-19
Auditor: Bonadio & CO LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
381007 2022-001 - Yes P
957449 2022-001 - Yes P

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund $2.80M Yes 1
93.697 Covid-19 Testing for Rural Health Clinics $500,000 - 0

Contacts

Name Title Type
CE9BS1TKEE85 Sharon Navarra Auditee
3157135355 Jonathan Miller Auditor
No contacts on file

Notes to SEFA

Title: General Accounting Policies: Basis of Accounting: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Claxton-Hepburn Medical Center does not allocate indirect costs to federal programs, and as such, does not elect to apply the 10% de minimis rate permitted by the Uniform Guidance. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) has been prepared in accordance with accounting principles generally accepted in the United States of America. Amounts included in the Schedule are actual expenditures for the year ended December 31, 2022. The accompanying Schedule presents the activity of all federal award programs of Claxton-Hepburn Medical Center. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of Claxton- Hepburn Medical Center’s operations, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Claxton-Hepburn Medical Center.
Title: Basis of Accounting Accounting Policies: Basis of Accounting: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Claxton-Hepburn Medical Center does not allocate indirect costs to federal programs, and as such, does not elect to apply the 10% de minimis rate permitted by the Uniform Guidance. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Indirect Costs Accounting Policies: Basis of Accounting: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Claxton-Hepburn Medical Center does not allocate indirect costs to federal programs, and as such, does not elect to apply the 10% de minimis rate permitted by the Uniform Guidance. Claxton-Hepburn Medical Center does not allocate indirect costs to federal programs, and as such, does not elect to apply the 10% de minimis rate permitted by the Uniform Guidance.
Title: Provider Relief Funds Accounting Policies: Basis of Accounting: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Claxton-Hepburn Medical Center does not allocate indirect costs to federal programs, and as such, does not elect to apply the 10% de minimis rate permitted by the Uniform Guidance. The Schedule includes grant activity related to the Department of Health and Human Services (HHS) Provider Relief Fund and American Rescue Plan (ARP) Distribution Assistance Listing Number 93.498. As required based on guidance in the 2022 OMB Compliance Supplement, the Schedule includes all Period 3 funds received between January 1, 2021 to June 30, 2021 and Period 4 funds received between July 1, 2021 and December 31, 2021 and expended by December 31, 2022 as reported to HHS via the Provider Relief Funding Reporting Portal. Given the timing covered by Periods 3 and 4, certain expenses were reflected in Claxton-Hepburn Medical Center 2021 consolidated financial statements. Additionally, lost revenue does not represent an expenditure in Claxton-Hepburn Medical Center’s consolidated financial statements and thus is a reconciling item between the federal expenses in Claxton-Hepburn Medical Center’s consolidated financial statements and amount included on the Schedule.

Finding Details

Program U.S. Department of Health and Human Services; COVID-19 - Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution – Assistance Listing No. 93.498; Grant Period -Year Ended December 31, 2022. Condition Support for and the approval of expenditures of goods and services charged to the PRF program could not be identified. Criteria Controls should be in place to ensure that the expenditures of PRF were used to prevent, prepare for, and respond to the effects of COVID-19. Cause The Company’s accounting and financial practices were not well designed. Effect Because of the inadequately designed internal control structure, controls were not in place to ensure that the expenditures of PRF were used to prevent, prepare for, and respond to the effects of COVID-19. Recommendation Claxton-Hepburn Medical Center should implement controls to ensure that the procurement and expenditure of goods and services are valid and are allocated and charged to appropriate department and federal program. Views of Responsible Officials and Planned Corrective Actions During the period under review, a prior management team was in place. Since that time, the Company’s accounting, payroll, and finance leadership has experienced significant turnover. The current leadership team has worked diligently to address internal control structure of the accounting, payroll, and purchasing processes. The internal control structure is perpetually assessed for additional changes that would enhance internal controls; however, the process continues to prove as a challenge due to the aging accounting system and inherent limitations in the software.
Program U.S. Department of Health and Human Services; COVID-19 - Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution – Assistance Listing No. 93.498; Grant Period -Year Ended December 31, 2022. Condition Support for and the approval of expenditures of goods and services charged to the PRF program could not be identified. Criteria Controls should be in place to ensure that the expenditures of PRF were used to prevent, prepare for, and respond to the effects of COVID-19. Cause The Company’s accounting and financial practices were not well designed. Effect Because of the inadequately designed internal control structure, controls were not in place to ensure that the expenditures of PRF were used to prevent, prepare for, and respond to the effects of COVID-19. Recommendation Claxton-Hepburn Medical Center should implement controls to ensure that the procurement and expenditure of goods and services are valid and are allocated and charged to appropriate department and federal program. Views of Responsible Officials and Planned Corrective Actions During the period under review, a prior management team was in place. Since that time, the Company’s accounting, payroll, and finance leadership has experienced significant turnover. The current leadership team has worked diligently to address internal control structure of the accounting, payroll, and purchasing processes. The internal control structure is perpetually assessed for additional changes that would enhance internal controls; however, the process continues to prove as a challenge due to the aging accounting system and inherent limitations in the software.