FAC Explorer

Audit 321318

FY End
2021-12-31
Total Expended
$897,051
Findings
12
Programs
4
Organization: Wishek Hospital Clinic Association D/b/a South Central Health (ND)
Year: 2021 Accepted: 2024-09-26
Auditor: Brady Martz & Associates PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
498569 2021-002 Material Weakness - L
498570 2021-002 Material Weakness - L
498571 2021-002 Material Weakness - L
498572 2021-002 Material Weakness - L
498573 2021-003 Material Weakness - ABL
498574 2021-004 Material Weakness - L
1075011 2021-002 Material Weakness - L
1075012 2021-002 Material Weakness - L
1075013 2021-002 Material Weakness - L
1075014 2021-002 Material Weakness - L
1075015 2021-003 Material Weakness - ABL
1075016 2021-004 Material Weakness - L

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $796,522 Yes 3
93.155 Rural Health Research Centers $75,567 - 1
93.889 National Bioterrorism Hospital Preparedness Program $16,890 - 1
93.461 Hrsa Covid-19 Claims Reimbursement for the Uninsured Program and the Covid-19 Coverage Assistance Fund $8,072 - 1

Contacts

Name Title Type
TRMSAE2MZN24 Megan Rath Auditee
7014523125 Nicole Heldstab Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the schedule of expenditures of federal awards (the “schedule”) are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Wishek Hospital Clinic Association D/B/A South Central Health has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule includes the federal award activity of Wishek Hospital Clinic Association D/B/A South Central Health under programs of the federal government for the year ended December 31, 2021. The information in this schedule 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 operations of Wishek Hospital Clinic Association D/B/A South Central Health, it is not intended to and does not present the financial position, change in net assets, or cash flows of the Wishek Hospital Clinic Association D/B/A South Central Health.
Title: DONATED PERSONAL PROTECTIVE EQUIPMENT (PPE) (UNAUDITED) Accounting Policies: Expenditures reported on the schedule of expenditures of federal awards (the “schedule”) are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Wishek Hospital Clinic Association D/B/A South Central Health has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. Nonmonetary assistance of PPE received during the emergency period of the COVID-19 pandemic was approximately $5,000 and is based on the estimated fair market value of the PPE received. The donated PPE was generally provided by donors without information about compliance or reporting requirements associated with federal financial assisting listings or CFDA numbers. The donated PPE is not included in the schedule of expenditure of federal awards.
Title: COVID-19 PROVIDER RELIEF FUND AND AMERICAN RESCUE PLAN (ARP) RURAL DISTRIBUTION Accounting Policies: Expenditures reported on the schedule of expenditures of federal awards (the “schedule”) are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Wishek Hospital Clinic Association D/B/A South Central Health has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The Association received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan Rural Distribution program (Federal Financial Assistance Listing/CFDA #93.498) during the years ended December 31, 2020 and 2021. The PRF expenditures were not recognized on the schedule until the expenditures were included in the reporting to HHS for the funds received prior to June 30, 2020 for period 1 and prior to December 31, 2020 for period 2, as required under the PRF program. The Association recorded $796,522 of Provider Relief Funds and American Rescue Plan Rural Distribution Funds on the Schedule of Expenditures of Federal Awards as of December 31, 2021 and $526,912 in revenue on the financial statements for the year ended December 31, 2021. The total amount of PRF expenditures included on the Schedule requires management to make estimates and assumptions that affect the reported amounts. Accordingly, such expenditures are considered a significant estimate. Estimates and assumptions may include reducing actual expenses by amounts that have been reimbursed or are obligated to be reimbursed by other sources and estimating marginal increases in expenses related to coronavirus. Actual amounts could differ from those estimates.

Finding Details

Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-003
Department of Health and Human Services Federal Assistance Listing/CFDA #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution 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 Association had 26 invoices identified as eligible that were not reviewed and approved. The Associations had 6 timesheets that were not reviewed and approved. In addition, the Association’s final expenditure listing, lost revenue calculation identified as eligible and claimed under the Provider Relief Fund program, and special report submitted to the Department of Health and Human Services for Period 1 did not have evidence of being reviewed and approved by a separate individual outside of the preparer. Cause The Association did not have an adequate internal control policy in place to ensure review and approval over specifically identified invoices and timesheets, the final expenditure listing, the lost revenue calculation, or preparation of HHS Period 1 reporting were documented. Effect The lack of adequate policies governing the review and approval of invoices, timesheets, expenditure listings, lost revenue calculation and the HHS Period 1 report increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Without a secondary review and approval, there is a possibility that ineligible expenditures may be claimed under the program. Context Detail testing was completed over $777,856 of the expenses along with the calculation for lost revenue for activities allowed and unallowable and allowable cost/cost principles. A nonstatistical sample of 40 expenditures (29 nonpayroll and 11 payroll) were selected for detailed testing, 26 invoices did not have evidence of being reviewed and approved and 6 timesheets didn’t have evidence of being reviewed. The overall expense listings and lost revenue worksheet did not have evidence of a review by someone other than the preparer (i.e., population of two). The Report submitted to HHS also did not have a documented secondary review and approval (i.e., population of one). Recommendation We recommend the Association enhance internal controls policies to ensure all invoices are reviewed and approved to ensure all expenses claimed under the federal program are necessary, correct and meet the requirements of the federal program. We also recommend the Association implement a control process which includes a secondary review and approval of the final expenditure listing and lost revenue calculation used to claim the allowable costs under the federal program and that there is documented evidence of the review and approval. In addition, the Report submitted to HHS should have a secondary review and approval that is documented.Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-004
Department of Health and Human Services Federal Assistance Listing/CFDA #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution Criteria 2 CFR 200.33(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 Association is required to submit an accurate report to HHS for each filing period of funds were received. Condition The Association claimed eligible expenses attributable to coronavirus in which the final calculation did not tie to the HHS Report. Cause The Association had a calculation error of $53,510 on the HHS special report causing a difference to the actual eligible expenses (i.e. there were more expenses reported on the HHS special report). Effect The lack of adequate policies over the special report preparation and submission increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. The Association submitted expenses over their actual allowable expenses. Questioned Costs There are questioned costs related to expenses of $53,510 that were included in the report. Context The HHS special reports included total eligible expenses calculation errors of $53,510. Recommendation We recommend that the Association enhance internal control policies to ensure the HHS special report is supported by supporting calculations. This would include implementing a secondary review and approval over the reporting. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-002
2021-002: Material Weakness - Untimely Filing of Data Collection Form All federal programs Criteria 2 CFR § 200.512(a)(1) states that an auditee must submit a data collection form and audit reporting package to the Federal Audit Clearinghouse within the earlier of 30 days after receipt of the auditor’s report or nine months after the end of the audit period. Condition The Association is required to submit the data collection form electronically to the Federal Audit Clearinghouse. This is to be completed within 30 days of report issuance or nine months after year-end (December 31), whichever is earlier. The data collection forms for the year ended December 31, 2021 was not timely filed. Cause The Association had not completed its audits as of the due date, therefore the data collection form was not filed in a timely manner. Effect The Association was not in compliance with the requirements for filing the data collection form. Context The Association’s December 31, 2021 audited financial statements was not completed as of the due date, therefore the data collection form was not filed timely. Recommendation We recommend that the Association ensure that the audit is completed in a timely manner and the data collection form is filed within the required timeline. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-003
Department of Health and Human Services Federal Assistance Listing/CFDA #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution 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 Association had 26 invoices identified as eligible that were not reviewed and approved. The Associations had 6 timesheets that were not reviewed and approved. In addition, the Association’s final expenditure listing, lost revenue calculation identified as eligible and claimed under the Provider Relief Fund program, and special report submitted to the Department of Health and Human Services for Period 1 did not have evidence of being reviewed and approved by a separate individual outside of the preparer. Cause The Association did not have an adequate internal control policy in place to ensure review and approval over specifically identified invoices and timesheets, the final expenditure listing, the lost revenue calculation, or preparation of HHS Period 1 reporting were documented. Effect The lack of adequate policies governing the review and approval of invoices, timesheets, expenditure listings, lost revenue calculation and the HHS Period 1 report increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. Without a secondary review and approval, there is a possibility that ineligible expenditures may be claimed under the program. Context Detail testing was completed over $777,856 of the expenses along with the calculation for lost revenue for activities allowed and unallowable and allowable cost/cost principles. A nonstatistical sample of 40 expenditures (29 nonpayroll and 11 payroll) were selected for detailed testing, 26 invoices did not have evidence of being reviewed and approved and 6 timesheets didn’t have evidence of being reviewed. The overall expense listings and lost revenue worksheet did not have evidence of a review by someone other than the preparer (i.e., population of two). The Report submitted to HHS also did not have a documented secondary review and approval (i.e., population of one). Recommendation We recommend the Association enhance internal controls policies to ensure all invoices are reviewed and approved to ensure all expenses claimed under the federal program are necessary, correct and meet the requirements of the federal program. We also recommend the Association implement a control process which includes a secondary review and approval of the final expenditure listing and lost revenue calculation used to claim the allowable costs under the federal program and that there is documented evidence of the review and approval. In addition, the Report submitted to HHS should have a secondary review and approval that is documented.Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.
Finding 2021-004
Department of Health and Human Services Federal Assistance Listing/CFDA #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution Criteria 2 CFR 200.33(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 Association is required to submit an accurate report to HHS for each filing period of funds were received. Condition The Association claimed eligible expenses attributable to coronavirus in which the final calculation did not tie to the HHS Report. Cause The Association had a calculation error of $53,510 on the HHS special report causing a difference to the actual eligible expenses (i.e. there were more expenses reported on the HHS special report). Effect The lack of adequate policies over the special report preparation and submission increases the risk that employees participating in the federal award administration may not be able to detect and correct noncompliance in a timely manner. The Association submitted expenses over their actual allowable expenses. Questioned Costs There are questioned costs related to expenses of $53,510 that were included in the report. Context The HHS special reports included total eligible expenses calculation errors of $53,510. Recommendation We recommend that the Association enhance internal control policies to ensure the HHS special report is supported by supporting calculations. This would include implementing a secondary review and approval over the reporting. Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding, has prepared an assessment of the root causes of this material weakness, and has developed a corrective action plan. Indication of Repeat Finding This is not a repeat finding in the current year.