FAC Explorer

Audit 316739

FY End
2023-12-31
Total Expended
$1.72M
Findings
2
Programs
1
Organization: McIntosh Senior Living (MN)
Year: 2023 Accepted: 2024-08-06
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
480543 2023-003 Material Weakness Yes N
1056985 2023-003 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $1.72M Yes 1

Contacts

Name Title Type
TNX9KLM7Y3G5 Sharlene Knutson Auditee
2185632715 Ashley Brandt-Duda 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the Organization under programs of the federal government for the year ended December 31, 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 Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization.
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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimus 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. The Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate.
Title: Note 4 – 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimus cost rate. Expenditures reported on this Schedule consists of the beginning of the year outstanding loan balance of the Organization’s USDA direct loans of $1,617,794, as well as $106,151, which is 90% of the beginning of the year outstanding balance of the Organization’s USDA guaranteed loan. If applicable, advances made on the loans during the year are reported on the Schedule. The Organization made no advances on the loans during the year ended December 31, 2023. The Organization’s outstanding loan balances for the direct loans and the guaranteed loan as of December 31, 2023 are $1,585,405 and $104,506.

Finding Details

Finding 2023-003
Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Cluster Special Tests and Provisions 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, we noted that the reserve account was not separately identified and there was no formal review separate from the preparer over the reserve fund reconciliation for the federal program. Cause – The Organization did not have an adequate internal control policy in place to ensure the reserve account was separately tracked and a documented review and approval over the reserve fund occurred. Effect – The lack of adequate policies governing the review increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Questioned Costs – None reported. Context – Sampling was not used. The Organization has one reserve account that was tested. Repeat Finding from Prior Years – Yes Recommendation – We recommend that the Organization enhance internal control policies to ensure that the reserve fund is separately tracked and formal documentation of reviews are present. View of Responsible Officials – Management agrees with the finding.
Finding 2023-003
Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Cluster Special Tests and Provisions 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, we noted that the reserve account was not separately identified and there was no formal review separate from the preparer over the reserve fund reconciliation for the federal program. Cause – The Organization did not have an adequate internal control policy in place to ensure the reserve account was separately tracked and a documented review and approval over the reserve fund occurred. Effect – The lack of adequate policies governing the review increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Questioned Costs – None reported. Context – Sampling was not used. The Organization has one reserve account that was tested. Repeat Finding from Prior Years – Yes Recommendation – We recommend that the Organization enhance internal control policies to ensure that the reserve fund is separately tracked and formal documentation of reviews are present. View of Responsible Officials – Management agrees with the finding.