FAC Explorer

Audit 305482

FY End
2022-12-31
Total Expended
$21.63M
Findings
6
Programs
4
Organization: Boulder City Hospital, Inc. (NV)
Year: 2022 Accepted: 2024-05-03
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
395858 2022-003 Material Weakness Yes L
395859 2022-004 Material Weakness - B
395860 2022-005 Material Weakness - N
972300 2022-003 Material Weakness Yes L
972301 2022-004 Material Weakness - B
972302 2022-005 Material Weakness - N

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $18.39M Yes 1
10.768 Business and Industry Guaranteed Loans $1.98M Yes 0
93.498 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $1.02M Yes 2
93.155 Rural Health Research Centers $242,152 - 0

Contacts

Name Title Type
NWMZN7JGRL66 Doug Lewis Auditee
7022934111 Kevin Smith Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 - BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Hospital has not elected to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Boulder City Hospital, Inc. (the Hospital) under programs of the federal government for the year ended December 31, 2022. The information 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 the operations of the Hospital, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Hospital.
Title: NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Hospital has not elected to use the 10% de minimis cost rate. Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient.
Title: NOTE 3 - INDIRECT COST RATE Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Hospital has not elected to use the 10% de minimis cost rate. The Hospital has not elected to use the 10% de minimis cost rate.
Title: NOTE 4 - PROVIDER RELIEF FUND AND AMERICAN RESCUE PLAN FUNDS Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Hospital has not elected to use the 10% de minimis cost rate. The Hospital received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (PRF) program (Federal Financial Assistance Listing #93.498) during the years ended December 31, 2021 of $1,022,791. The PRF expenditures are not recognized on the schedule until the expenditures are included in the reporting to HHS as required under the PRF program.
Title: NOTE 5 - LOAN PROGRAMS Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Hospital has not elected to use the 10% de minimis cost rate. Expenditures in this schedule consist of the beginning of the year outstanding loan balance plus advances made on the loan during the year. The outstanding balance at December 31, 2022 was as follows for the respective programs: COVID‐19 CARES Act Business & Industry Guaranteed Loan - 10.768 - $2,196,692; Community Facilities Loans and Grants Cluster 10.766 - $18,119,662. The COVID‐19 CARES Act Business & Industry Guaranteed Loan has a 90% guarantee.

Finding Details

Finding 2022-003
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Periods 3 & 4 TIN #88‐0065829 Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria ‐ The Hospital must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Hospital is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. The Hospital selected option iii to calculate lost revenue which allows for an alternate reasonable methodology to be used. Condition – The Hospital opted for a budget to actual comparison for the calculation of lost revenue as an alternate reasonable methodology, however the actual amounts used did not consider adjustments during the fiscal year. Cause ‐ The Hospital did not have an internal control process in place to ensure the accuracy of the reporting key line items and excluded adjustments to revenue from the actual balances used in the lost revenue calculation. Effect – There was no effect on the amount of lost revenue applied against the funding received, however there were errors in the key line items reported that resulted in an underreporting of lost revenue. Questioned Costs ‐ None reported. Context ‐ Key line items were tested on the Period 3 & 4 Department of Health and Human Services special reports. Repeat Finding from Prior Years ‐ Yes Recommendation ‐ We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements. Views of Responsible Officials ‐ Management agrees with the finding.
Finding 2022-004
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Periods 3 & 4 TIN #88‐0065829 Allowable Costs and Activities Material Weakness in Internal Control Over Compliance Criteria ‐ The Hospital must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Hospital is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Condition – The Hospital opted for a budget to actual comparison for the calculation of lost revenue as an alternate reasonable methodology, however the actual amounts used did not consider adjustments during the fiscal year. Cause ‐ The Hospital did not have an internal control process in place to ensure the accuracy of the calculation and excluded adjustments to revenue. Effect – There was no effect on the amount of lost revenue applied against the funding received. Questioned Costs ‐ None reported. Context – The lost revenue calculation for all applicable quarters was tested and reviewed. Repeat Finding from Prior Years ‐ Yes Recommendation ‐ We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements. Views of Responsible Officials ‐ Management agrees with the finding.
Finding 2022-005
Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Cluster Special Tests and Provisions Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria ‐ 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specific account balance is reached. Condition ‐ The Hospital did not sufficiently fund their reserve account. As of December 31, 2022, the Hospital should have USDA debt reserves at least equal to $320,669. Cause ‐ There was a lack of adequate policies governing the understanding and execution of loan agreement requirements. Effect ‐ The Hospital was not in compliance with their provisions of the USDA debt agreements. Questioned Costs ‐ None reported. Context ‐ Sampling was not used. Repeat Finding from Prior Years ‐ No Recommendation ‐ We recommend the Hospital enhance internal control policies to ensure that loan requirements are monitored and met. Views of Responsible Officials ‐ Management agrees with the finding.
Finding 2022-003
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Periods 3 & 4 TIN #88‐0065829 Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria ‐ The Hospital must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Hospital is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. The Hospital selected option iii to calculate lost revenue which allows for an alternate reasonable methodology to be used. Condition – The Hospital opted for a budget to actual comparison for the calculation of lost revenue as an alternate reasonable methodology, however the actual amounts used did not consider adjustments during the fiscal year. Cause ‐ The Hospital did not have an internal control process in place to ensure the accuracy of the reporting key line items and excluded adjustments to revenue from the actual balances used in the lost revenue calculation. Effect – There was no effect on the amount of lost revenue applied against the funding received, however there were errors in the key line items reported that resulted in an underreporting of lost revenue. Questioned Costs ‐ None reported. Context ‐ Key line items were tested on the Period 3 & 4 Department of Health and Human Services special reports. Repeat Finding from Prior Years ‐ Yes Recommendation ‐ We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements. Views of Responsible Officials ‐ Management agrees with the finding.
Finding 2022-004
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Periods 3 & 4 TIN #88‐0065829 Allowable Costs and Activities Material Weakness in Internal Control Over Compliance Criteria ‐ The Hospital must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Hospital is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Condition – The Hospital opted for a budget to actual comparison for the calculation of lost revenue as an alternate reasonable methodology, however the actual amounts used did not consider adjustments during the fiscal year. Cause ‐ The Hospital did not have an internal control process in place to ensure the accuracy of the calculation and excluded adjustments to revenue. Effect – There was no effect on the amount of lost revenue applied against the funding received. Questioned Costs ‐ None reported. Context – The lost revenue calculation for all applicable quarters was tested and reviewed. Repeat Finding from Prior Years ‐ Yes Recommendation ‐ We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements. Views of Responsible Officials ‐ Management agrees with the finding.
Finding 2022-005
Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Cluster Special Tests and Provisions Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria ‐ 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specific account balance is reached. Condition ‐ The Hospital did not sufficiently fund their reserve account. As of December 31, 2022, the Hospital should have USDA debt reserves at least equal to $320,669. Cause ‐ There was a lack of adequate policies governing the understanding and execution of loan agreement requirements. Effect ‐ The Hospital was not in compliance with their provisions of the USDA debt agreements. Questioned Costs ‐ None reported. Context ‐ Sampling was not used. Repeat Finding from Prior Years ‐ No Recommendation ‐ We recommend the Hospital enhance internal control policies to ensure that loan requirements are monitored and met. Views of Responsible Officials ‐ Management agrees with the finding.