Identification: 2 CFR 200.302 Financial Management; 93.498 United States Department of Health and Human Services, Provider Relief Fund (PRF) and American Rescue Plan Rural Distribution (ARPA); Material weaknesses/Activities Allowed or Unallowed, Allowable Cost/Cost Principle and Reporting Compliance Requirements There was inadequate internal controls in place over financial reporting related to revenue recognition and reconciling general ledger balances to supporting documentation which caused inadequate controls over compliance related to federal programs. See Financial Statement Findings 2023-001, 2023-002, and 2023-003 for a description of these deficiencies, including the views of responsible officials.
Identification: Noncompliance Finding/Material Weakness; Reporting Compliance Requirement Criteria: The financial management system of each non-Federal entity must provide records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income, and interest and be supported by source documentation. The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Recipients who received one or more payments exceeding $10,000 are required to report in each applicable reporting period. Condition: The Hospital did not retain supporting documentation for the amounts reported for Period 4 in the reporting portal for expenditures and lost revenues. Cause: The Chief Financial Officer who was responsible for calculating lost revenues and identifying expenses to report as expenditures for the PRF and ARPA funds did not have proper controls in place for tracking and monitoring federal grant expenditures or for following the applicable sections of the Uniform Guidance and the terms and conditions of the PRF and ARPA funds. Effect: The Chief Financial Officer had to recreate Excel spreadsheets for the lost revenue calculation and expenditure listing. The recreated supporting documentation did not tie to the Period 4 reporting submission resulting in lost revenues reported for Period 4 to be overstated by $81,151 and expenditures reported for Period 4 to be overstated by $232. Questioned costs: $41,176; $40,944 lost revenues used and $232 expenditures. Perspective Information: Totals of recreated spreadsheets were compared to the Period 4 reporting submission. Lost revenue questioned costs were arrived at by allocating the Period 4 lost revenues per the reporting submission as a percentage of the Period 4 lost revenues used per the reporting submission (excluding carryover from prior periods) to the overstatement of lost revenues. Expenditure questioned costs are equal to the difference between the Period 4 reporting submission expenditures and the recreated spreadsheet total expenditures. Repeat Finding: N/A Recommendations: We recommend policies and procedures over federal award tracking, monitoring, and reporting be strengthened to ensure compliance with the Uniform Guidance and the terms and conditions of the federal award. Procedures should include maintaining all supporting documentation and verifying the accuracy and completeness of amounts reported. Views of Responsible Officials: In the future, the Hospital will maintain adequate financial records and supporting documentation for federal awards. The Hospital will use a spreadsheet to track all federal awards. The spreadsheet will be prepared by the accountant and reviewed by the Chief Financial Officer. The spreadsheet will be included in the monthly financial information provided to the Board of Directors for review and approval.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse recipients for lost revenues that are attributable to coronavirus. Cause: The Hospital changed the methodology for calculating lost revenues from the Period 1 reporting submission to the Period 4 reporting submission. The Hospital continued to use option i, actual revenues for the quarters reported for Period 4 as compared to actual revenues for the quarters in 2019. Actual revenues for the quarters in 2019 properly included 340(b) drug program revenues. The Period 4 quarter calculations included 340(b) drug program revenues but also included 340(b) drug program expenses as part of actual revenues. Only revenues should be included in the calculation of actual revenues. Effect: The Hospital's lost revenues were overstated by $995,847. Questioned costs: $502,446 Perspective Information: We tested the calculation of lost revenues per the recreated spreadsheet to monthly internal financial statements, audited financial statements, and other supporting documentation to determine if the report was compiled accurately. Lost revenue questioned costs were arrived at by allocating the Period 4 lost revenues per the reporting submission as a percentage of the Period 4 lost revenues used per the reporting submission (excluding carryover from prior periods) to the overstatement of lost revenues. Repeat Finding: N/A Recommendations: We recommend policies and procedures over PRF and ARPA reporting be strengthened to ensure that only revenues be included in the calculation of lost revenues based on actual revenues per the applicable reporting period. Views of Responsible Officials: In the future, the Hospital will maintain adequate supporting documentation for the calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported by reconciling to the audited financial statements, internal financial statements, and other source documentation. The Hospital will be cognizant of only including revenue in the calculation and that the periods being compared are calculated using the same methodology. In addition, the Hospital will be proactive in getting necessary training and education regarding allowable uses of federal funding received in future years. The Hospital has recalculated lost revenues for the quarters covered by Period 4 to exclude the 340(b) drug program expenses from the calculation, in addition to taking into consideration corrections needed for items noted in finding 2023-007.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse recipients for lost revenues that are attributable to coronavirus. Cause: The Hospital had multiple errors in calculating lost revenues for the Period 4 reporting submission (other than the error noted in 2021-006). The Hospital did not take into account audit adjusting journal entries for the fiscal year ended July 31, 2022, for the quarters impacted. Included in the audit adjusting journal entries was the cost report settlement entry that impacted all quarters. In addition, the Hospital did not include an estimated impact to fiscal year ended July 31, 2023, for the cost report settlement for the quarters impacted. The Hospital did include an audit adjusting journal entry that impacted 340(b) drug program revenue but incorrectly recorded it to the 3rd quarter of 2022 instead of allocating it to the applicable quarters. The spreading of audit adjusting journal entries and the cost report settlement impact to the applicable quarters was completed for actual revenues for the comparable quarters for 2019. Effect: The Hospital's lost revenues were misstated. Questioned costs: Unknown Perspective Information: We tested the calculation of lost revenues per the recreated spreadsheet to monthly internal financial statements, audited financial statements, and other supporting documentation to determine if the report was compiled accurately. Multiple errors were noted in reconciling to the audited financial statements, including not allocating journal entries to the quarters impacted. Repeat Finding: N/A Recommendations: We recommend policies and procedures over PRF and ARPA reporting be strengthened to ensure that revenues used in the calculation of lost revenues are reconciled to internal and audited financial statements and that general journal and audit entries are assessed to determine the appropriate quarter to be applied to for the lost revenue calculation. Views of Responsible Officials: The Hospital has recalculated lost revenues to incorporate the audit adjusting journal entries for the fiscal year ended July 31, 2022, for quarters impacted, incorporate the cost report settlement impact across all quarters impacted, and to include an estimated impact of the cost report settlement for quarters impacted for the fiscal year ended July 31, 2023. In addition, the revised calculation includes the correction needed to remove the 340(b) drug program expenses as noted in finding 2023-006 and to reconcile to supporting documentation as noted in finding 2023-005. The Hospital will work with the Department of Health and Human Services to correct the reporting. In the future, the Hospital will maintain adequate supporting documentation for the calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported by reconciling to the audited financial statements, internal financial statements, and other source documentation. The Hospital will be cognizant of items that are posted in one period that apply to multiple periods and accurately including those items in the calculation. In addition, the Hospital will be proactive in getting necesarry training and education regarding the allowable uses of federal funding received in future years.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Activities Allowed or Unallowed, Allowable Costs/Cost Principles and Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. The PRF and ARPA funds may not be used to reimburse expenses or losses that have been reimbursed by other sources or that other sources are obligated to reimburse. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse expenses that have not been reimbursed by other sources or that other sources are obligated to reimburse and that the funds be used to prevent, prepare for, and respond to coronavirus. Cause: The Hospital does not have procedures in place to track and monitor federal awards. Effect: The Hospital included expenditures that had been reimbursed by other federal awards and an expenditure that was not related to preventing, preparing, and responding to coronavirus. Questioned costs: $101,325 Perspective Information: Only three expenditures were listed on the recreated spreadsheet for expenditures reported for Period 4. Two were included on the listing of federal awards for the COVID-19 Small Rural Hospital Improvement Program. The other expenditure was tested and determined to not be related to preventing, preparing, or responding to coronavirus. Repeating Finding: N/A Recommendations: We recommend policies and procedures over federal grant reporting be strengthened to ensure expenditures are for their intended purpose and that the expenditures have not been reimbursed by another source or obligated to be reimbursed by other sources. Views of Responsible Officials: The Hospital has identified additional expenditures that occurred during Period 4 to prevent, prepare for, and respond to coronavirus that were not reimbursed by other sources or that other sources were obligated to reimburse that were omitted from the original submission. The Hospital will work with the Department of Health and Human Services to correct the reporting. In the future, the Hospital will maintain adequate financial records and supporting documentation for the federal awards. The tracking mechanism will include denoting if the expenditures have been reimbursed by another source or are obligated to be reimbursed by other sources. In addition, the Hospital will be proactive in getting necessary training and education regarding the allowable uses of federal funding received in future years.
Identification: 2 CFR 200.302 Financial Management; 93.498 United States Department of Health and Human Services, Provider Relief Fund (PRF) and American Rescue Plan Rural Distribution (ARPA); Material weaknesses/Activities Allowed or Unallowed, Allowable Cost/Cost Principle and Reporting Compliance Requirements There was inadequate internal controls in place over financial reporting related to revenue recognition and reconciling general ledger balances to supporting documentation which caused inadequate controls over compliance related to federal programs. See Financial Statement Findings 2023-001, 2023-002, and 2023-003 for a description of these deficiencies, including the views of responsible officials.
Identification: Noncompliance Finding/Material Weakness; Reporting Compliance Requirement Criteria: The financial management system of each non-Federal entity must provide records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income, and interest and be supported by source documentation. The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Recipients who received one or more payments exceeding $10,000 are required to report in each applicable reporting period. Condition: The Hospital did not retain supporting documentation for the amounts reported for Period 4 in the reporting portal for expenditures and lost revenues. Cause: The Chief Financial Officer who was responsible for calculating lost revenues and identifying expenses to report as expenditures for the PRF and ARPA funds did not have proper controls in place for tracking and monitoring federal grant expenditures or for following the applicable sections of the Uniform Guidance and the terms and conditions of the PRF and ARPA funds. Effect: The Chief Financial Officer had to recreate Excel spreadsheets for the lost revenue calculation and expenditure listing. The recreated supporting documentation did not tie to the Period 4 reporting submission resulting in lost revenues reported for Period 4 to be overstated by $81,151 and expenditures reported for Period 4 to be overstated by $232. Questioned costs: $41,176; $40,944 lost revenues used and $232 expenditures. Perspective Information: Totals of recreated spreadsheets were compared to the Period 4 reporting submission. Lost revenue questioned costs were arrived at by allocating the Period 4 lost revenues per the reporting submission as a percentage of the Period 4 lost revenues used per the reporting submission (excluding carryover from prior periods) to the overstatement of lost revenues. Expenditure questioned costs are equal to the difference between the Period 4 reporting submission expenditures and the recreated spreadsheet total expenditures. Repeat Finding: N/A Recommendations: We recommend policies and procedures over federal award tracking, monitoring, and reporting be strengthened to ensure compliance with the Uniform Guidance and the terms and conditions of the federal award. Procedures should include maintaining all supporting documentation and verifying the accuracy and completeness of amounts reported. Views of Responsible Officials: In the future, the Hospital will maintain adequate financial records and supporting documentation for federal awards. The Hospital will use a spreadsheet to track all federal awards. The spreadsheet will be prepared by the accountant and reviewed by the Chief Financial Officer. The spreadsheet will be included in the monthly financial information provided to the Board of Directors for review and approval.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse recipients for lost revenues that are attributable to coronavirus. Cause: The Hospital changed the methodology for calculating lost revenues from the Period 1 reporting submission to the Period 4 reporting submission. The Hospital continued to use option i, actual revenues for the quarters reported for Period 4 as compared to actual revenues for the quarters in 2019. Actual revenues for the quarters in 2019 properly included 340(b) drug program revenues. The Period 4 quarter calculations included 340(b) drug program revenues but also included 340(b) drug program expenses as part of actual revenues. Only revenues should be included in the calculation of actual revenues. Effect: The Hospital's lost revenues were overstated by $995,847. Questioned costs: $502,446 Perspective Information: We tested the calculation of lost revenues per the recreated spreadsheet to monthly internal financial statements, audited financial statements, and other supporting documentation to determine if the report was compiled accurately. Lost revenue questioned costs were arrived at by allocating the Period 4 lost revenues per the reporting submission as a percentage of the Period 4 lost revenues used per the reporting submission (excluding carryover from prior periods) to the overstatement of lost revenues. Repeat Finding: N/A Recommendations: We recommend policies and procedures over PRF and ARPA reporting be strengthened to ensure that only revenues be included in the calculation of lost revenues based on actual revenues per the applicable reporting period. Views of Responsible Officials: In the future, the Hospital will maintain adequate supporting documentation for the calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported by reconciling to the audited financial statements, internal financial statements, and other source documentation. The Hospital will be cognizant of only including revenue in the calculation and that the periods being compared are calculated using the same methodology. In addition, the Hospital will be proactive in getting necessary training and education regarding allowable uses of federal funding received in future years. The Hospital has recalculated lost revenues for the quarters covered by Period 4 to exclude the 340(b) drug program expenses from the calculation, in addition to taking into consideration corrections needed for items noted in finding 2023-007.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse recipients for lost revenues that are attributable to coronavirus. Cause: The Hospital had multiple errors in calculating lost revenues for the Period 4 reporting submission (other than the error noted in 2021-006). The Hospital did not take into account audit adjusting journal entries for the fiscal year ended July 31, 2022, for the quarters impacted. Included in the audit adjusting journal entries was the cost report settlement entry that impacted all quarters. In addition, the Hospital did not include an estimated impact to fiscal year ended July 31, 2023, for the cost report settlement for the quarters impacted. The Hospital did include an audit adjusting journal entry that impacted 340(b) drug program revenue but incorrectly recorded it to the 3rd quarter of 2022 instead of allocating it to the applicable quarters. The spreading of audit adjusting journal entries and the cost report settlement impact to the applicable quarters was completed for actual revenues for the comparable quarters for 2019. Effect: The Hospital's lost revenues were misstated. Questioned costs: Unknown Perspective Information: We tested the calculation of lost revenues per the recreated spreadsheet to monthly internal financial statements, audited financial statements, and other supporting documentation to determine if the report was compiled accurately. Multiple errors were noted in reconciling to the audited financial statements, including not allocating journal entries to the quarters impacted. Repeat Finding: N/A Recommendations: We recommend policies and procedures over PRF and ARPA reporting be strengthened to ensure that revenues used in the calculation of lost revenues are reconciled to internal and audited financial statements and that general journal and audit entries are assessed to determine the appropriate quarter to be applied to for the lost revenue calculation. Views of Responsible Officials: The Hospital has recalculated lost revenues to incorporate the audit adjusting journal entries for the fiscal year ended July 31, 2022, for quarters impacted, incorporate the cost report settlement impact across all quarters impacted, and to include an estimated impact of the cost report settlement for quarters impacted for the fiscal year ended July 31, 2023. In addition, the revised calculation includes the correction needed to remove the 340(b) drug program expenses as noted in finding 2023-006 and to reconcile to supporting documentation as noted in finding 2023-005. The Hospital will work with the Department of Health and Human Services to correct the reporting. In the future, the Hospital will maintain adequate supporting documentation for the calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported by reconciling to the audited financial statements, internal financial statements, and other source documentation. The Hospital will be cognizant of items that are posted in one period that apply to multiple periods and accurately including those items in the calculation. In addition, the Hospital will be proactive in getting necesarry training and education regarding the allowable uses of federal funding received in future years.
Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution (PRF); Noncompliance Finding/Material Weakness; Activities Allowed or Unallowed, Allowable Costs/Cost Principles and Reporting Compliance Requirements Criteria: The Provider Relief Fund and the American Rescue Plan Rural Distribution was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260) and the American Rescue Plan Act of 2021 (Pub. L. No. 117-2) . The PRF and ARPA funds are to be used to prevent, prepare for, and respond to coronavirus. The PRF and ARPA funds are to reimburse recipients for health care related expenses or lost revenues that are attributable to coronavirus. The PRF and ARPA funds may not be used to reimburse expenses or losses that have been reimbursed by other sources or that other sources are obligated to reimburse. Condition: The Hospital did not meet the requirement that the PRF and ARPA funds be used to reimburse expenses that have not been reimbursed by other sources or that other sources are obligated to reimburse and that the funds be used to prevent, prepare for, and respond to coronavirus. Cause: The Hospital does not have procedures in place to track and monitor federal awards. Effect: The Hospital included expenditures that had been reimbursed by other federal awards and an expenditure that was not related to preventing, preparing, and responding to coronavirus. Questioned costs: $101,325 Perspective Information: Only three expenditures were listed on the recreated spreadsheet for expenditures reported for Period 4. Two were included on the listing of federal awards for the COVID-19 Small Rural Hospital Improvement Program. The other expenditure was tested and determined to not be related to preventing, preparing, or responding to coronavirus. Repeating Finding: N/A Recommendations: We recommend policies and procedures over federal grant reporting be strengthened to ensure expenditures are for their intended purpose and that the expenditures have not been reimbursed by another source or obligated to be reimbursed by other sources. Views of Responsible Officials: The Hospital has identified additional expenditures that occurred during Period 4 to prevent, prepare for, and respond to coronavirus that were not reimbursed by other sources or that other sources were obligated to reimburse that were omitted from the original submission. The Hospital will work with the Department of Health and Human Services to correct the reporting. In the future, the Hospital will maintain adequate financial records and supporting documentation for the federal awards. The tracking mechanism will include denoting if the expenditures have been reimbursed by another source or are obligated to be reimbursed by other sources. In addition, the Hospital will be proactive in getting necessary training and education regarding the allowable uses of federal funding received in future years.