Audit 321815

2023-002 Local Collaborative Time Study (LCTS) Annual Spending Report Prior Year Finding Number: N/A Year of Finding Origination: 2023 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Program: 93.778 Medical Assistance Program Award Number and Year: 2305MN5ADM, 2023 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 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 the terms and conditions of the federal award. For County federal awards received from the Minnesota Department of Human Services (DHS), the County should establish and maintain internal control to provide assurance that program reports submitted to DHS are completed accurately and in accordance with reporting instructions. As part of Watonwan County’s reporting requirements for the Medical Assistance Program, the County submits the Local Collaborative Time Study (LCTS) Annual Spending Report on an annual basis. Condition: The following exceptions were noted in the 2023 LCTS Annual Spending Report reviewed: • Reported LCTS funds received were understated by $9,796. • Reported LCTS funds spent on services and administration were understated by $4,560. Questioned Costs: None. Context: DHS relies on accurate reporting of program costs to ensure that resulting grant funds paid to the County are for allowable federal program activities/costs and provide detailed information necessary for maintaining proper oversight over federal programs. The County has since reviewed the LCTS Annual Spending Report to correct the errors identified in the audit and has resubmitted the report to DHS. Effect: The 2023 LCTS Annual Spending Report sumbitted to DHS was not accurate. Cause: The County’s controls over preparation of the report were not sufficient to identify the reporting errors. Recommendation: We recommend Watonwan County implement controls to ensure accurate reporting to DHS in accordance with federal program guidance and DHS instructions. View of Responsible Official: Acknowledge

2023-002 Local Collaborative Time Study (LCTS) Annual Spending Report Prior Year Finding Number: N/A Year of Finding Origination: 2023 Type of Finding: Internal Control Over Compliance and Compliance Severity of Deficiency: Significant Deficiency and Other Matter Federal Agency: U.S. Department of Health and Human Services Program: 93.778 Medical Assistance Program Award Number and Year: 2305MN5ADM, 2023 Pass-Through Agency: Minnesota Department of Human Services Criteria: Title 2 U.S. Code of Federal Regulations § 200.303 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 the terms and conditions of the federal award. For County federal awards received from the Minnesota Department of Human Services (DHS), the County should establish and maintain internal control to provide assurance that program reports submitted to DHS are completed accurately and in accordance with reporting instructions. As part of Watonwan County’s reporting requirements for the Medical Assistance Program, the County submits the Local Collaborative Time Study (LCTS) Annual Spending Report on an annual basis. Condition: The following exceptions were noted in the 2023 LCTS Annual Spending Report reviewed: • Reported LCTS funds received were understated by $9,796. • Reported LCTS funds spent on services and administration were understated by $4,560. Questioned Costs: None. Context: DHS relies on accurate reporting of program costs to ensure that resulting grant funds paid to the County are for allowable federal program activities/costs and provide detailed information necessary for maintaining proper oversight over federal programs. The County has since reviewed the LCTS Annual Spending Report to correct the errors identified in the audit and has resubmitted the report to DHS. Effect: The 2023 LCTS Annual Spending Report sumbitted to DHS was not accurate. Cause: The County’s controls over preparation of the report were not sufficient to identify the reporting errors. Recommendation: We recommend Watonwan County implement controls to ensure accurate reporting to DHS in accordance with federal program guidance and DHS instructions. View of Responsible Official: Acknowledge