FAC Explorer

Audit 310474

FY End
2023-09-30
Total Expended
$2.46M
Findings
6
Programs
5
Organization: Mile Bluff Medical Center, Inc. (WI)
Year: 2023 Accepted: 2024-06-27
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
403356 2023-004 Material Weakness Yes L
403357 2023-005 Material Weakness Yes ABL
403358 2023-006 Significant Deficiency Yes P
979798 2023-004 Material Weakness Yes L
979799 2023-005 Material Weakness Yes ABL
979800 2023-006 Significant Deficiency Yes P

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund $2.07M Yes 3
93.697 Covid-19 Testing for Rural Health Clinics $300,459 - 0
20.513 Enhanced Mobility of Seniors and Individuals with Disabilities $47,600 - 0
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $26,177 - 0
93.301 Small Rural Hospital Improvement Grant Program $12,444 - 0

Contacts

Name Title Type
QAGXERFAK5A8 Jessica Thompson Auditee
6088471453 Tyler Bernier 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, 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 Medical Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (Schedule) includes the federal award activity of Mile Bluff Medical Center, Inc. (Medical Center) under programs of the federal government for the year ended September 30, 2023. 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 Medical Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Medical Center.
Title: Note 4 - Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, 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 Medical Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The Medical Center received amount 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 year ended September 30, 2022. The Medical Center incurred eligible expenditures, including lost revenue, and therefore, recognized revenues totaling on $2,074,596 for the year ended September 30, 2022 on the consolidated financial statements. In accordance with the 2023 Compliance Supplement, the PRF expenditures recognized on the Schedule are based on the reporting to HHS for Period 4, defined as payments received during July 1, 2021 to December 31, 2021 of $2,074,596, as required under the PRF program.

Finding Details

Finding 2023-004
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 – Period 4 TIN #390992883 Reporting Material Weakness in Internal Control Over Compliance 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. Condition: The Medical Center’s narrative outlining lost revenues did not accurately reflect the calculation utilized for the lost revenue calculated and reported to the Department of Health and Human Services (HHS). Cause: The Medical Center did not have an adequate internal control policy in place to ensure that the lost revenue calculation was consistent with its submitted lost revenue calculation memos. Effect: There is a potential that the lost revenue calculation may contain errors based upon the narrative outlining the calculation. Questioned Costs: None. Context: All key line items were tested on the Period 4 HHS special report. Repeat Finding from Prior Years: Yes, finding 2021-004. Recommendation: We recommend the Medical Center implement procedures to ensure the narrative submitted to HHS be consistent with the calculation of lost revenue claimed on the reports to HHS. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-005
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 – Period 4 TIN #390992883 Activities Allowed or Unallowed, Allowable Costs/Cost Principles and Reporting Material Weakness in Internal Control Over Compliance 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. Condition: During our testing, there was no documentation of review and approval of the expenditure listing, lost revenue calculation, or the HHS Period 4 report. Cause: The Medical Center did not have an adequate internal control policy in place to ensure review and approval of expenditures and lost revenue claimed under the federal program, and the HHS Period 4 report was documented. Effect: Without a secondary review and approval, there is a possibility that ineligible expenditures or lost revenue may be claimed under the program and the HHS Period 4 report may not be accurately completed. Questioned Costs: None reported. Context: A nonstatistical sample of 14 expenditures was selected for testing, which accounted for $493,531 of $2,074,596 direct program expenditures. There was one lost revenue calculation, one expenditure detail and one HHS Period 4 report and all three were tested. Repeat Finding from Prior Years: Yes, finding 2021-005. Recommendation: We recommend that the Medical Center enhance internal control policies to ensure the expenditure listing, lost revenue calculation, and HHS reports are reviewed and approved to ensure that all payments are necessary, correct, meet the requirements of the federal program, and are properly recorded in the reports required to be submitted to the federal agency. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-006
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 – Period 4 TIN #390992883 Preparation of Schedule of Expenditures of Federal Awards Significant Deficiency in Internal Control Over Compliance Criteria: Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition: The Medical Center does not have an internal control system designed to provide for a complete and accurate preparation of the Schedule. As auditors, we were requested to assist with the preparation of the Schedule. Cause: Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Medical Center meets a specified threshold of federal expenditures. Effect: There is a reasonable possibility that the Medical Center would not be able to draft the Schedule that is correct without the assistance of the auditors. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Years: Yes, finding 2021-006. Recommendation: While we recognize that this condition is not unusual for an organization with limited staffing, we recommend management be aware of the financial reporting requirements relating to the Medical Center’s Schedule and the internal controls that impact financial reporting. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-004
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 – Period 4 TIN #390992883 Reporting Material Weakness in Internal Control Over Compliance 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. Condition: The Medical Center’s narrative outlining lost revenues did not accurately reflect the calculation utilized for the lost revenue calculated and reported to the Department of Health and Human Services (HHS). Cause: The Medical Center did not have an adequate internal control policy in place to ensure that the lost revenue calculation was consistent with its submitted lost revenue calculation memos. Effect: There is a potential that the lost revenue calculation may contain errors based upon the narrative outlining the calculation. Questioned Costs: None. Context: All key line items were tested on the Period 4 HHS special report. Repeat Finding from Prior Years: Yes, finding 2021-004. Recommendation: We recommend the Medical Center implement procedures to ensure the narrative submitted to HHS be consistent with the calculation of lost revenue claimed on the reports to HHS. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-005
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 – Period 4 TIN #390992883 Activities Allowed or Unallowed, Allowable Costs/Cost Principles and Reporting Material Weakness in Internal Control Over Compliance 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. Condition: During our testing, there was no documentation of review and approval of the expenditure listing, lost revenue calculation, or the HHS Period 4 report. Cause: The Medical Center did not have an adequate internal control policy in place to ensure review and approval of expenditures and lost revenue claimed under the federal program, and the HHS Period 4 report was documented. Effect: Without a secondary review and approval, there is a possibility that ineligible expenditures or lost revenue may be claimed under the program and the HHS Period 4 report may not be accurately completed. Questioned Costs: None reported. Context: A nonstatistical sample of 14 expenditures was selected for testing, which accounted for $493,531 of $2,074,596 direct program expenditures. There was one lost revenue calculation, one expenditure detail and one HHS Period 4 report and all three were tested. Repeat Finding from Prior Years: Yes, finding 2021-005. Recommendation: We recommend that the Medical Center enhance internal control policies to ensure the expenditure listing, lost revenue calculation, and HHS reports are reviewed and approved to ensure that all payments are necessary, correct, meet the requirements of the federal program, and are properly recorded in the reports required to be submitted to the federal agency. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-006
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 – Period 4 TIN #390992883 Preparation of Schedule of Expenditures of Federal Awards Significant Deficiency in Internal Control Over Compliance Criteria: Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition: The Medical Center does not have an internal control system designed to provide for a complete and accurate preparation of the Schedule. As auditors, we were requested to assist with the preparation of the Schedule. Cause: Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Medical Center meets a specified threshold of federal expenditures. Effect: There is a reasonable possibility that the Medical Center would not be able to draft the Schedule that is correct without the assistance of the auditors. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Years: Yes, finding 2021-006. Recommendation: While we recognize that this condition is not unusual for an organization with limited staffing, we recommend management be aware of the financial reporting requirements relating to the Medical Center’s Schedule and the internal controls that impact financial reporting. Views of Responsible Officials: Management agrees with the finding.