Criteria – The Hospital is required to submit filings with The Health Resource and Service Administration (HRSA) under the Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution programs. Such filings include reporting COVID-19 expenses and lost revenues, as defined.
Condition – The Hospital’s Provider Relief Fund filing with HRSA for Reporting Period 4 (through December 31, 2022) contained errors in the amounts reported for American Rescue Plan (ARP) Rural Expenses.
Context – The errors had no impact on the amount of Provider Relief Funds the Hospital was allowed to retain due to the excess of COVID-19 costs and lost revenues over the amount of program funds received.
Cause – The Hospital inadvertently reported no expenses related to ARP Rural Expenses and included those amounts under Unreimbursed Expenses Attributable to Coronavirus.
Effect – The cost amounts reported to HRSA for Reporting Period 4 were inaccurate.
Recommendation – We recommend that the Hospital ensure that future filings with HRSA accurately report all costs.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding and has taken steps to ensure the accuracy of costs in any future filings.
Criteria – The Hospital is required to establish and maintain effective internal control over federal awards that provides reasonable assurance the entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Condition – Costs relating to the United States Department of Homeland Security program were not reduced for financial assistance received from another source, such as Medicare cost reimbursement.
Context – The errors had no impact on the amount of federal awards the Hospital was allowed to retain due to the excess of related costs over the amount of federal awards received.
Cause – The Hospital inadvertently did not reduce costs by their Medicare cost reimbursement, which represents financial assistance received from another source.
Effect – The cost amounts were inaccurate.
Recommendation – We recommend that management review procedures and change as necessary to ensure costs are reduced by financial assistance received from another source.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. The policies are being reviewed and new procedures put in place as needed to ensure proper compliance.
Criteria – The Hospital is required to establish and maintain effective internal control over federal awards that provides reasonable assurance the entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Condition – Evidence of payment of certain expense transactions under the United States Department of Homeland Security program was not maintained by management.
Context – For 23 out of 40 tested transactions, evidence of payment of expense transactions was not able to be provided. There are additional supportable costs in excess of funding received, for which evidence of payment is available. Therefore, the errors had no impact on the amount of federal awards the Hospital was allowed to retain due to the excess of related costs over the amount of federal awards received.
Cause – Evidence of payment was not available as audit testing occurred approximately four years after expenses were incurred. Certain documentation was transferred to long-term storage and unavailable during audit testing. Additionally, there was an accounting software conversion since such expenses were incurred and the Hospital no longer has access to the prior accounting software.
Effect – The Hospital was unable to provide supporting documentation for certain of its expenses.
Recommendation – We recommend that management review procedures and change as necessary to ensure evidence is maintained to support the expense transactions.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. There has been turnover within the organization, in addition to the accounting software conversion, and policies are being reviewed and new procedures put in place as needed to ensure documentation of proper compliance.
Criteria – Financial statements are used by management and the Board of Trustees to make decisions and need to accurately present the Hospital’s financial position and results of operations.
Condition – Material adjustments were necessary to properly present the financial statements in accordance with generally accepted accounting principles.
Context – The Hospital has had significant turnover in its finance department.
Cause – Financial statement balances are not being appropriately reconciled to the underlying accounting records.
Effect – The financial statements were materially misstated at year-end.
Prior Year Finding – In the prior audit period a similar finding, 2022-001, was noted.
Recommendation – The Hospital should reconcile all accounts on a monthly basis to ensure all account balances reconcile to the general ledger and implement a review process to ensure accurate reported balances.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital’s finance team will reconcile all accounts on a monthly basis and keep a copy of such reconciliations in its monthly documentation file.
Criteria – Financial statements are used by management and the Board of Trustees to make decisions and need to accurately present the Hospital’s financial position and results of operations.
Condition – Material adjustments were necessary to properly present the financial statements in accordance with generally accepted accounting principles.
Context – The Hospital has had significant turnover in its finance department.
Cause – Financial statement balances are not being appropriately reconciled to the underlying accounting records.
Effect – The financial statements were materially misstated at year-end.
Prior Year Finding – In the prior audit period a similar finding, 2022-001, was noted.
Recommendation – The Hospital should reconcile all accounts on a monthly basis to ensure all account balances reconcile to the general ledger and implement a review process to ensure accurate reported balances.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital’s finance team will reconcile all accounts on a monthly basis and keep a copy of such reconciliations in its monthly documentation file.
Criteria – Those charged with governance are to provide oversight of financial reporting. The Board of Trustees and management need accurate and timely financial reporting to oversee and manage the Hospital.
Condition – The Hospital has procedures for account reconciliations and review and approval by the appropriate authority for transaction cycles; however, the Hospital’s internal controls still failed to prevent, detect, and correct material misstatements in the financial statements. As a result, the Board of Trustees was not receiving accurate and timely financial reporting to use in their oversight of the Hospital, and management were not receiving accurate and timely financial reporting to manage the Hospital.
Context – The Hospital has had significant turnover in its finance department.
Cause – Internal controls are not being followed with sufficient diligence.
Effect – Material misstatements in the financial statements were undetected by management. The Board of Trustees and management were not receiving accurate and timely financial reporting to perform their functions.
Prior Year Finding – In the prior audit period a similar finding, 2022-003, was noted.
Recommendation – The Hospital should evaluate each aspect of its policies and procedures. Individuals responsible for transaction cycles and accounting, and those individuals responsible for review and approval of transaction cycles, should be sufficiently educated and instructed to ensure internal controls are operating effectively.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital will ensure finance staff are aware of and following its financial policies and procedures.
Criteria – Those charged with governance are to provide oversight of financial reporting. The Board of Trustees and management need accurate and timely financial reporting to oversee and manage the Hospital.
Condition – The Hospital has procedures for account reconciliations and review and approval by the appropriate authority for transaction cycles; however, the Hospital’s internal controls still failed to prevent, detect, and correct material misstatements in the financial statements. As a result, the Board of Trustees was not receiving accurate and timely financial reporting to use in their oversight of the Hospital, and management were not receiving accurate and timely financial reporting to manage the Hospital.
Context – The Hospital has had significant turnover in its finance department.
Cause – Internal controls are not being followed with sufficient diligence.
Effect – Material misstatements in the financial statements were undetected by management. The Board of Trustees and management were not receiving accurate and timely financial reporting to perform their functions.
Prior Year Finding – In the prior audit period a similar finding, 2022-003, was noted.
Recommendation – The Hospital should evaluate each aspect of its policies and procedures. Individuals responsible for transaction cycles and accounting, and those individuals responsible for review and approval of transaction cycles, should be sufficiently educated and instructed to ensure internal controls are operating effectively.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital will ensure finance staff are aware of and following its financial policies and procedures.
Criteria – The Hospital is required to submit filings with The Health Resource and Service Administration (HRSA) under the Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution programs. Such filings include reporting COVID-19 expenses and lost revenues, as defined.
Condition – The Hospital’s Provider Relief Fund filing with HRSA for Reporting Period 4 (through December 31, 2022) contained errors in the amounts reported for American Rescue Plan (ARP) Rural Expenses.
Context – The errors had no impact on the amount of Provider Relief Funds the Hospital was allowed to retain due to the excess of COVID-19 costs and lost revenues over the amount of program funds received.
Cause – The Hospital inadvertently reported no expenses related to ARP Rural Expenses and included those amounts under Unreimbursed Expenses Attributable to Coronavirus.
Effect – The cost amounts reported to HRSA for Reporting Period 4 were inaccurate.
Recommendation – We recommend that the Hospital ensure that future filings with HRSA accurately report all costs.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding and has taken steps to ensure the accuracy of costs in any future filings.
Criteria – The Hospital is required to establish and maintain effective internal control over federal awards that provides reasonable assurance the entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Condition – Costs relating to the United States Department of Homeland Security program were not reduced for financial assistance received from another source, such as Medicare cost reimbursement.
Context – The errors had no impact on the amount of federal awards the Hospital was allowed to retain due to the excess of related costs over the amount of federal awards received.
Cause – The Hospital inadvertently did not reduce costs by their Medicare cost reimbursement, which represents financial assistance received from another source.
Effect – The cost amounts were inaccurate.
Recommendation – We recommend that management review procedures and change as necessary to ensure costs are reduced by financial assistance received from another source.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. The policies are being reviewed and new procedures put in place as needed to ensure proper compliance.
Criteria – The Hospital is required to establish and maintain effective internal control over federal awards that provides reasonable assurance the entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards.
Condition – Evidence of payment of certain expense transactions under the United States Department of Homeland Security program was not maintained by management.
Context – For 23 out of 40 tested transactions, evidence of payment of expense transactions was not able to be provided. There are additional supportable costs in excess of funding received, for which evidence of payment is available. Therefore, the errors had no impact on the amount of federal awards the Hospital was allowed to retain due to the excess of related costs over the amount of federal awards received.
Cause – Evidence of payment was not available as audit testing occurred approximately four years after expenses were incurred. Certain documentation was transferred to long-term storage and unavailable during audit testing. Additionally, there was an accounting software conversion since such expenses were incurred and the Hospital no longer has access to the prior accounting software.
Effect – The Hospital was unable to provide supporting documentation for certain of its expenses.
Recommendation – We recommend that management review procedures and change as necessary to ensure evidence is maintained to support the expense transactions.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with this finding. There has been turnover within the organization, in addition to the accounting software conversion, and policies are being reviewed and new procedures put in place as needed to ensure documentation of proper compliance.
Criteria – Financial statements are used by management and the Board of Trustees to make decisions and need to accurately present the Hospital’s financial position and results of operations.
Condition – Material adjustments were necessary to properly present the financial statements in accordance with generally accepted accounting principles.
Context – The Hospital has had significant turnover in its finance department.
Cause – Financial statement balances are not being appropriately reconciled to the underlying accounting records.
Effect – The financial statements were materially misstated at year-end.
Prior Year Finding – In the prior audit period a similar finding, 2022-001, was noted.
Recommendation – The Hospital should reconcile all accounts on a monthly basis to ensure all account balances reconcile to the general ledger and implement a review process to ensure accurate reported balances.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital’s finance team will reconcile all accounts on a monthly basis and keep a copy of such reconciliations in its monthly documentation file.
Criteria – Financial statements are used by management and the Board of Trustees to make decisions and need to accurately present the Hospital’s financial position and results of operations.
Condition – Material adjustments were necessary to properly present the financial statements in accordance with generally accepted accounting principles.
Context – The Hospital has had significant turnover in its finance department.
Cause – Financial statement balances are not being appropriately reconciled to the underlying accounting records.
Effect – The financial statements were materially misstated at year-end.
Prior Year Finding – In the prior audit period a similar finding, 2022-001, was noted.
Recommendation – The Hospital should reconcile all accounts on a monthly basis to ensure all account balances reconcile to the general ledger and implement a review process to ensure accurate reported balances.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital’s finance team will reconcile all accounts on a monthly basis and keep a copy of such reconciliations in its monthly documentation file.
Criteria – Those charged with governance are to provide oversight of financial reporting. The Board of Trustees and management need accurate and timely financial reporting to oversee and manage the Hospital.
Condition – The Hospital has procedures for account reconciliations and review and approval by the appropriate authority for transaction cycles; however, the Hospital’s internal controls still failed to prevent, detect, and correct material misstatements in the financial statements. As a result, the Board of Trustees was not receiving accurate and timely financial reporting to use in their oversight of the Hospital, and management were not receiving accurate and timely financial reporting to manage the Hospital.
Context – The Hospital has had significant turnover in its finance department.
Cause – Internal controls are not being followed with sufficient diligence.
Effect – Material misstatements in the financial statements were undetected by management. The Board of Trustees and management were not receiving accurate and timely financial reporting to perform their functions.
Prior Year Finding – In the prior audit period a similar finding, 2022-003, was noted.
Recommendation – The Hospital should evaluate each aspect of its policies and procedures. Individuals responsible for transaction cycles and accounting, and those individuals responsible for review and approval of transaction cycles, should be sufficiently educated and instructed to ensure internal controls are operating effectively.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital will ensure finance staff are aware of and following its financial policies and procedures.
Criteria – Those charged with governance are to provide oversight of financial reporting. The Board of Trustees and management need accurate and timely financial reporting to oversee and manage the Hospital.
Condition – The Hospital has procedures for account reconciliations and review and approval by the appropriate authority for transaction cycles; however, the Hospital’s internal controls still failed to prevent, detect, and correct material misstatements in the financial statements. As a result, the Board of Trustees was not receiving accurate and timely financial reporting to use in their oversight of the Hospital, and management were not receiving accurate and timely financial reporting to manage the Hospital.
Context – The Hospital has had significant turnover in its finance department.
Cause – Internal controls are not being followed with sufficient diligence.
Effect – Material misstatements in the financial statements were undetected by management. The Board of Trustees and management were not receiving accurate and timely financial reporting to perform their functions.
Prior Year Finding – In the prior audit period a similar finding, 2022-003, was noted.
Recommendation – The Hospital should evaluate each aspect of its policies and procedures. Individuals responsible for transaction cycles and accounting, and those individuals responsible for review and approval of transaction cycles, should be sufficiently educated and instructed to ensure internal controls are operating effectively.
Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. The Hospital will ensure finance staff are aware of and following its financial policies and procedures.