FAC Explorer

Audit 342225

FY End
2021-09-30
Total Expended
$12.66M
Findings
2
Programs
1
Organization: Sky Lakes Medical Center (OR)
Year: 2021 Accepted: 2025-02-12
Auditor: Moss Adams LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
522980 2021-001 Material Weakness - L
1099422 2021-001 Material Weakness - L

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $12.66M Yes 1

Contacts

Name Title Type
EGWRFW1HT4D4 Richard Rico Auditee
5412746311 Tony Andrade Auditor
No contacts on file

Notes to SEFA

Title: Summary of Significant Accounting Policies Accounting Policies: The Schedule of Expenditures of Federal Awards (the Schedule) is presented using the modified accrual basis of accounting, which is described in Note 1 to the consolidated financial statements of Sky Lakes Medical Center and Affiliates (the Medical Center). 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 (Uniform Guidance) wherein certain types of expenses are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: During the fiscal year ended September 30, 2021, the Medical Center did not elect to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Schedule of Expenditures of Federal Awards (the Schedule) is presented using the modified accrual basis of accounting, which is described in Note 1 to the consolidated financial statements of Sky Lakes Medical Center and Affiliates (the Medical Center). 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 (Uniform Guidance) wherein certain types of expenses are not allowable or are limited as to reimbursement.
Title: Election of De Minimis Indirect Cost Rate Accounting Policies: The Schedule of Expenditures of Federal Awards (the Schedule) is presented using the modified accrual basis of accounting, which is described in Note 1 to the consolidated financial statements of Sky Lakes Medical Center and Affiliates (the Medical Center). 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 (Uniform Guidance) wherein certain types of expenses are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: During the fiscal year ended September 30, 2021, the Medical Center did not elect to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. During the fiscal year ended September 30, 2021, the Medical Center did not elect to use the 10- percent de minimis indirect cost rate allowed under the Uniform Guidance.
Title: Basis of Presentation Accounting Policies: The Schedule of Expenditures of Federal Awards (the Schedule) is presented using the modified accrual basis of accounting, which is described in Note 1 to the consolidated financial statements of Sky Lakes Medical Center and Affiliates (the Medical Center). 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 (Uniform Guidance) wherein certain types of expenses are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: During the fiscal year ended September 30, 2021, the Medical Center did not elect to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Schedule presents the activity of all federally-funded programs of the Medical Center. The reporting entity is defined in Note 1 to the Medical Center’s consolidated financial statements. The information in the Schedule is presented in accordance with the requirements of the Uniform Guidance.
Title: Restatement Accounting Policies: The Schedule of Expenditures of Federal Awards (the Schedule) is presented using the modified accrual basis of accounting, which is described in Note 1 to the consolidated financial statements of Sky Lakes Medical Center and Affiliates (the Medical Center). 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 (Uniform Guidance) wherein certain types of expenses are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: During the fiscal year ended September 30, 2021, the Medical Center did not elect to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Schedule was restated to correct the amount of expenditures reported for the one major program to only reflect period 1 payments that were received and should be reported based on the requirements specified by the Department of Health and Human Services. The originally issued schedule incorrectly included period 1 and 2 payments.

Finding Details

Finding 2021-001
Finding 2021-001 – Preparation of the Schedule of Expenditures of Federal Awards (Material Weakness) in internal controls over compliance Federal Agency – U.S. Department of Health and Human Services AL Number - 93.498 Federal Program Title – COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Award Period – Period 1 Reporting (Period of Availability January 1, 2020 – June 30, 2021) Criteria: The Uniform Guidance (2 CFR 200) Section 200.510 requires an auditee to “prepare a schedule of expenditures of Federal awards (SEFA) for the period covered by the auditee’s financial statements [that]….at a minimum shall…list individual Federal programs by Federal agency…[and] provide total Federal awards expended for each individual Federal program and the Assistance Listing Number (ALN) number or other identifying number when the ALN information is not available.” In accordance with Uniform Guidance, the Medical Center is required to maintain a structure of internal control to ensure compliance with applicable reporting requirements. Condition/Context: Because the Medical Center had never received a single audit before receiving funding from the COVID-19 programs, the Medical Center did not have sufficient controls to ensure the population to draft the SEFA included the correct expenditures that qualified as expenditure of a federal award during the period. The complicated Provider Relief Fund reporting periods resulted in a timing issue only. Questioned Costs: None noted. Cause: Factors contributing to the condition included the high volume of activity related to the new COVID-19 programs. Effect: As a result of the Medical Center’s inaccurate reporting of the PRF expenditures on the population used to draft the SEFA, the Medical Center’s 2021 SEFA was adjusted and completion of compliance related testing and reported had to be updated. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Medical Center develop and implement a review process throughout the year to ensure compliance with SEFA reporting requirements as outlined in Uniform Guidance. Views of responsible officials and planned corrective action: Any funds received in the future with unusual reporting requirements similar to these COVID funds will be reviewed in detail to ensure reporting is complete and accurate.
Finding 2021-001
Finding 2021-001 – Preparation of the Schedule of Expenditures of Federal Awards (Material Weakness) in internal controls over compliance Federal Agency – U.S. Department of Health and Human Services AL Number - 93.498 Federal Program Title – COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Award Period – Period 1 Reporting (Period of Availability January 1, 2020 – June 30, 2021) Criteria: The Uniform Guidance (2 CFR 200) Section 200.510 requires an auditee to “prepare a schedule of expenditures of Federal awards (SEFA) for the period covered by the auditee’s financial statements [that]….at a minimum shall…list individual Federal programs by Federal agency…[and] provide total Federal awards expended for each individual Federal program and the Assistance Listing Number (ALN) number or other identifying number when the ALN information is not available.” In accordance with Uniform Guidance, the Medical Center is required to maintain a structure of internal control to ensure compliance with applicable reporting requirements. Condition/Context: Because the Medical Center had never received a single audit before receiving funding from the COVID-19 programs, the Medical Center did not have sufficient controls to ensure the population to draft the SEFA included the correct expenditures that qualified as expenditure of a federal award during the period. The complicated Provider Relief Fund reporting periods resulted in a timing issue only. Questioned Costs: None noted. Cause: Factors contributing to the condition included the high volume of activity related to the new COVID-19 programs. Effect: As a result of the Medical Center’s inaccurate reporting of the PRF expenditures on the population used to draft the SEFA, the Medical Center’s 2021 SEFA was adjusted and completion of compliance related testing and reported had to be updated. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Medical Center develop and implement a review process throughout the year to ensure compliance with SEFA reporting requirements as outlined in Uniform Guidance. Views of responsible officials and planned corrective action: Any funds received in the future with unusual reporting requirements similar to these COVID funds will be reviewed in detail to ensure reporting is complete and accurate.