Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Criteria:
In accordance with 2 CFR section 200.403(e), costs must be adequately documented.
Condition:
Of forty non-payroll expenditures tested, aggregating $128,258 of a total population of $2,220,614, the following were noted:
1. For one (or 3%), supporting Credit Card No Receipt Form (CCNRF) (document no C16791 totaling $51) indicates the original fuel receipt was provided to KCHC’s accounting office. However, no supporting fuel receipt was provided to the audit team supporting the CCNRF.
2. For one (or 3%), the invoice provided by KCHC did not match the expenditure details (invoice no. 21279098 totaling $5,957). The invoice provided by KCHC (invoice no. 212790986) was incorrect.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable allowable costs/cost principles requirements.
Effect:
KCHC is in noncompliance with applicable allowable costs/cost principles. Questioned costs of $6,008 result as the project questioned costs exceeds $25,000 threshold.
Identification as a Repeat Finding: Finding No. 2021-004
Finding No. 2022-003, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Allowable Costs/Cost Principles
Questioned Costs: $6,008
Recommendation:
Program Expenditures should be approved only when supported by accurate and complete documents.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Criteria:
In accordance with entity’s strict draw down policy, all grant drawdowns shall be on a reimbursement basis and drawn down on an as needed basis based on actual allowable expenditures in order to minimize/eliminate the time elapsing between the transfer of the Federal awards and the disbursement of the fund. Further, drawdowns may not be made to cover future expenditures.
Condition:
Of three SF-425 reports tested, for two (or 66%), cumulative expenditures reported were based on cumulative drawdowns for which amounts were higher than the cumulative expenditures per the underlying accounting records. As KCHC is on a strict reimbursement basis, the variance of $91,960 is questioned.
Cause:
KCHC did not follow its grant draw down reimbursement policy and monitoring controls over compliance with applicable cash management requirements.
Effect:
KCHC is in noncompliance with the cash management requirement and questioned costs of $91,960 result.
Finding No. 2022-004, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624 and H8D36529
Area: Cash Management
Questioned Costs: $91,960
Recommendation:
Responsible personnel should monitor drawdowns based on actual allowable expenditures to substantiate compliance with its draw down policy.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-005
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Criteria:
In accordance with 45 CFR section 75.309, a non-federal entity may charge only allowable costs incurred during the period of performance and any costs incurred before the Health and Human Services (HHS) awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity.
Condition:
For forty subsequent expenditures tested, aggregating $98,002 of a total population of $348,465, the following were noted:
1. For twenty-three (or 58%), expenditures were incurred and/or obligated after the obligation period of 04/30/2022.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Condition, continued:
2. For one (or 3%), cancelled check or other form of evidence (document no. 73206, dated 06/06/2022 amounting to $190) was not provided; accordingly, KCHC was not able to substantiate that the payment was liquidated within the grant award’s 120 days liquidation period, for which the amount is questioned.
3. For sixteen (or 40%), no supporting documents were provided to substantiate that the expenditures were incurred within the period of performance.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No. 2022-005, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Period of Performance
Questioned Costs: $98,002
Effect:
KCHC is in noncompliance with applicable period of performance requirements and questioned costs of $98,002 result.
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is timely provided and is filed to facilitate easy retrieval substantiating compliance.
Identification as a Repeat Finding: Finding No. 2021-005
Views of Responsible Officials:
KCHC’s Corrective Action Plan provides a rationale for disagreement with the finding.
Auditor response:
The supporting evidence provided indicates that the expenditures were incurred after the period of performance. Further, KCHC failed to provide evidence of certain expenditures being incurred within the corresponding period of performance. The finding remains.
Finding No. 2022-006
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Criteria:
Non-federal entities other than states must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They may use their own documented procedures, which reflect applicable state and local laws and regulations, provided that the procurements confirm to applicable federal statutes and the procurement requirements identified in 2 CFR Part 200.
Further, KCHC’s procurement policy requires the following:
• For small purchases between $10,001 to $250,000, price or rate quotes must be obtained from an adequate number of sources (at least two) and all quotes, including phone calls, web searches, etc., must be documented and kept on file.
• To be allowable under a federal award, costs must be reasonable, allocable, and adequately documented and consistent with federal cost principles.
Condition:
Of forty non-payroll expenditures tested, aggregating $234,183 of a total population of $770,029, the following were noted:
1. For six (or 15%), supporting procurement package was not sufficient to demonstrate price or rate quotes had been obtained from an adequate number of sources.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Condition, continued:
2. For one (or 3%), no contractual agreement between KCHC and the vendor was provided to the audit team (invoice nos. 1235 and 1351 totaling $3,000 and $1,200, respectively).
3. For one (or 3%), supporting procurement package was not sufficient to support open and fair competition for document no. 2834 totaling $1,215.
4. For 11 (or 28%), no purchase order was provided.
Cause:
KCHC did not enforce recordkeeping and monitoring controls over compliance with applicable procurement and suspension and debarment requirements.
Effect:
KCHC is in noncompliance with applicable procurement requirements and questioned costs of $126,567 result.
Finding No. 2022-006, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Procurement and Suspension and Debarment
Questioned Costs: $126,567
Effect, continued:
Identification as a Repeat Finding: Finding No. 2021-006
Recommendation:
Responsible personnel should establish a recordkeeping system whereby underlying support for each transaction is processed timely and is filed to facilitate easy retrieval substantiating procurement compliance. In addition, responsible personnel should enforce compliance with procurement regulations.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.
Finding No. 2022-007
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Criteria:
In accordance with 2 CFR section 200.328 and applicable reporting requirements, the Program is required to submit an accurate SF-425, Federal Financial Report.
Condition:
For three (or 100%) SF-425 reports tested, the following variances were noted:
1. Grant Award H80CS31624 - 04/30/2022 Reporting Period End Date:
2. Grant Award H8DCS36429 - 03/31/2022 Reporting Period End Date:
3. Grant Award H8FCS41048 - 03/31/2022 Reporting Period End Date:
Finding No. 2022-007, continued
Federal Agency: U.S. Department of Health and Human Services
AL Program: 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care)
Federal Award No.: H8031624, H8F41048, H8D36529
Area: Reporting
Questioned Costs: $-0-
Cause:
KCHC did not effectively monitor the accuracy and completeness of the SF 425 report based on underlying accounting records.
Effect:
KCHC is in noncompliance with the SF-425 federal reporting requirements. No questioned costs are presented as the variances are due to reporting errors.
Identification as a Repeat Finding: Finding No. 2021-007
Recommendation:
Responsible personnel should take steps to monitor reports and determine that expenditures and program income reported on the SF-425 report are supported by underlying accounting reports.
Views of Responsible Officials:
Management agrees with the finding and has developed a plan to correct the finding. Refer to separate Corrective Action Plan.