Audit 340965

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal awards. Section 4 of the loan resolution security agreements dated September 2, 2008 and March 10, 2010 states the Hospital must set aside a reserve amount each month until the specified account balance is reached. Condition: The Hospital’s reserve account is fully funded per the requirements in the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is reported within the monthly financial information provided to the board and the reserve balance is noted as “in compliance”, however, there is no documented discussion or comparison of the reserve balance to the required minimum reserve balance. The board may be unaware of changes in the reserve balance which could cause the Hospital to no longer be in compliance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context: Sampling was not used. Repeat Finding from Prior Year: Yes, prior year finding 2023‐004. Recommendation: We recommend management implement procedures to include a comparison of the required minimum reserve balance to the actual reserve balance and documenting the requirement in the monthly financial information provided to the board. Views of Responsible Officials: Management agrees with the finding.