Audit 31137

Finding 2022-002: Reporting ? Internal Controls over Compliance and Instance of Noncompliance / Federal Program: COVID-19 ? Provider Relief Fund, Assistance Listing Number 93.498, U.S. Department of Health and Human Services / Criteria: Under the Provider Relief Fund Program, providers are required to submit reporting to the Health Resources Services Administration (HRSA). Providers claiming lost revenues are required to calculate and report total patient revenues by quarter for calendar years 2019 through 2021, which was used to compute total lost revenues reported. / Condition: We identified two errors in reporting of quarterly patient revenues that was used to support the amount of lost revenue required by the Provider Relief Fund distributions for Period 2. In both cases, amounts reported understated the amount of lost revenue. However, the understated amounts were still sufficient to full cover the amount of Provider Relief Funds received by Merrick, Inc., resulting in no net impact. / Cause: As noted in Financial Statement Finding 2022-001, Merrick, Inc. experienced turnover within its accounting department at the time reporting for the Provider Relief program for Period 2 was due. This situation, coupled with the evolving nature of the specific terms and conditions of the Provider Relief Fund program, is believed to be the primary cause of the condition noted above. / Effect or potential effect: As noted above in the ?Condition? section, there was no net impact. / Questioned costs: None. / Identification as a repeat finding, if applicable: Not applicable. This is not a repeat finding. / Recommendation: We recommend Merrick, Inc. implement control activities over its financial information as described in Financial Statement Finding 2022-001. In the event Merrick, Inc. has future federal reporting requirements, we recommend that Merrick, Inc. implement control activities to ensure precise reviews are performed to validate the accuracy of data reported prior to final submission.

Finding 2022-002: Reporting ? Internal Controls over Compliance and Instance of Noncompliance / Federal Program: COVID-19 ? Provider Relief Fund, Assistance Listing Number 93.498, U.S. Department of Health and Human Services / Criteria: Under the Provider Relief Fund Program, providers are required to submit reporting to the Health Resources Services Administration (HRSA). Providers claiming lost revenues are required to calculate and report total patient revenues by quarter for calendar years 2019 through 2021, which was used to compute total lost revenues reported. / Condition: We identified two errors in reporting of quarterly patient revenues that was used to support the amount of lost revenue required by the Provider Relief Fund distributions for Period 2. In both cases, amounts reported understated the amount of lost revenue. However, the understated amounts were still sufficient to full cover the amount of Provider Relief Funds received by Merrick, Inc., resulting in no net impact. / Cause: As noted in Financial Statement Finding 2022-001, Merrick, Inc. experienced turnover within its accounting department at the time reporting for the Provider Relief program for Period 2 was due. This situation, coupled with the evolving nature of the specific terms and conditions of the Provider Relief Fund program, is believed to be the primary cause of the condition noted above. / Effect or potential effect: As noted above in the ?Condition? section, there was no net impact. / Questioned costs: None. / Identification as a repeat finding, if applicable: Not applicable. This is not a repeat finding. / Recommendation: We recommend Merrick, Inc. implement control activities over its financial information as described in Financial Statement Finding 2022-001. In the event Merrick, Inc. has future federal reporting requirements, we recommend that Merrick, Inc. implement control activities to ensure precise reviews are performed to validate the accuracy of data reported prior to final submission.