Audit 315964

FINDING 2021-002 – Reporting, Non-compliance (Material Weakness) Federal program: U.S. Department of Health and Human Services – ALN 93.498, COVID-19 Provider Relief Fund (PRF) Criteria: 2 CFR Part 200.303(a) states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and terms and conditions of the federal award. Specific criteria are established by the U.S. Department of Health and Human Services (HHS) with respect to allowable cost and reporting requirements for this program, including: Funds shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus. Entities may elect to calculate, and report lost revenue using one of three options. Entities electing to calculate lost revenue using Option i report net revenue from patient care for each quarter and each year 2019, 2020, and 2021. For entities electing to report lost revenues using Option ii, the difference between budgeted and actual patient care revenues, budgets must be approved before March 27, 2020 and cover each quarter during the period of availability. Entities electing to calculate lost revenues using another reasonable method should report using option iii. Section 200.507 of the Uniform Guidance states that the program-specific audit shall be completed, and reporting required submitted within the earlier of 30 calendar days after receipt of the auditors’ report, or nine months after the end of the audit, unless a longer period is specified in a program_x0002_specific audit guide. Condition and Context: Internal controls surrounding the review process performed were not effective in detecting and correcting the proper reporting prior to submission. In the Hospital’s Period 1 reporting in the PRF reporting portal, the Hospital entered Total Other PRF Expenses of $2,072,205. Instead of then listing total other Coronavirus expenses that were not reimbursed by HRSA in the “Total Unreimbursed Expenses attributable to Coronavirus”, the Hospital listed the same $2,072,205 in the Unreimbursed Expenses section. The Hospital did not list all the pass-through grants found on the SEFA within the Other Assistance Received section of the PRF Report. Additionally, The Hospital did not complete and submit its audit report prior to the required deadline. Cause and Effect: Management review was not effective in detecting and correcting the errors before report submission; therefore the Hospital’s reporting in the PRF reporting portal double-counted the PRF reimbursed expenses as Coronavirus expenses that were not reimbursed and omitted listing other grants. Due to a delay in the compiling of records related to the audit, the Hospital was not in compliance with the reporting requirements. Questioned costs: None Repeat finding: No Recommendation: We recommend that internal controls be strengthened related to review of the quarterly lost revenue calculations and reporting in the PRF reporting portal. We recommend that the Hospital complete its audits and submit the required reports by the deadline. We recommend that the Hospital enter other assistance received by quarter during the period of availability on the PRF report. Views of responsible officials of the auditee: Management agrees with the finding and the auditors’ recommendation. See Management’s full response in the Corrective Action Plan at the end of this report.

FINDING 2021-002 – Reporting, Non-compliance (Material Weakness) Federal program: U.S. Department of Health and Human Services – ALN 93.498, COVID-19 Provider Relief Fund (PRF) Criteria: 2 CFR Part 200.303(a) states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and terms and conditions of the federal award. Specific criteria are established by the U.S. Department of Health and Human Services (HHS) with respect to allowable cost and reporting requirements for this program, including: Funds shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus. Entities may elect to calculate, and report lost revenue using one of three options. Entities electing to calculate lost revenue using Option i report net revenue from patient care for each quarter and each year 2019, 2020, and 2021. For entities electing to report lost revenues using Option ii, the difference between budgeted and actual patient care revenues, budgets must be approved before March 27, 2020 and cover each quarter during the period of availability. Entities electing to calculate lost revenues using another reasonable method should report using option iii. Section 200.507 of the Uniform Guidance states that the program-specific audit shall be completed, and reporting required submitted within the earlier of 30 calendar days after receipt of the auditors’ report, or nine months after the end of the audit, unless a longer period is specified in a program_x0002_specific audit guide. Condition and Context: Internal controls surrounding the review process performed were not effective in detecting and correcting the proper reporting prior to submission. In the Hospital’s Period 1 reporting in the PRF reporting portal, the Hospital entered Total Other PRF Expenses of $2,072,205. Instead of then listing total other Coronavirus expenses that were not reimbursed by HRSA in the “Total Unreimbursed Expenses attributable to Coronavirus”, the Hospital listed the same $2,072,205 in the Unreimbursed Expenses section. The Hospital did not list all the pass-through grants found on the SEFA within the Other Assistance Received section of the PRF Report. Additionally, The Hospital did not complete and submit its audit report prior to the required deadline. Cause and Effect: Management review was not effective in detecting and correcting the errors before report submission; therefore the Hospital’s reporting in the PRF reporting portal double-counted the PRF reimbursed expenses as Coronavirus expenses that were not reimbursed and omitted listing other grants. Due to a delay in the compiling of records related to the audit, the Hospital was not in compliance with the reporting requirements. Questioned costs: None Repeat finding: No Recommendation: We recommend that internal controls be strengthened related to review of the quarterly lost revenue calculations and reporting in the PRF reporting portal. We recommend that the Hospital complete its audits and submit the required reports by the deadline. We recommend that the Hospital enter other assistance received by quarter during the period of availability on the PRF report. Views of responsible officials of the auditee: Management agrees with the finding and the auditors’ recommendation. See Management’s full response in the Corrective Action Plan at the end of this report.