Audit 349073

FY End
2020-12-31
Total Expended
$2.75M
Findings
2
Programs
6
Organization: Confluence Health (WA)
Year: 2020 Accepted: 2025-03-27
Auditor: Moss Adams

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
538045 2020-001 Material Weakness - P
1114487 2020-001 Material Weakness - P

Contacts

Name Title Type
ML88S3LCLFE3 Eric Caldwell Auditee
5094333824 Mary Wright Auditor
No contacts on file

Notes to SEFA

Title: Note 1 – Basis of Presentation Accounting Policies: Note 2 – Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass through entity identifying numbers are presented where available. De Minimis Rate Used: Y Rate Explanation: Note 4 – Indirect Cost Rate Confluence Health System has elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Confluence Health System under programs of the Federal Government for the year ended December 31, 2020. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of Confluence Health System, it is not intended to and does not present the financial position, changes in net assets or cash flows of Confluence Health System.
Title: Note 3 – Program Costs Accounting Policies: Note 2 – Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass through entity identifying numbers are presented where available. De Minimis Rate Used: Y Rate Explanation: Note 4 – Indirect Cost Rate Confluence Health System has elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The amounts shown as current year expenses represent only federal grant portion of the program costs. Entire program costs may be more than shown.
Title: Note 5 – Restatement Accounting Policies: Note 2 – Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass through entity identifying numbers are presented where available. De Minimis Rate Used: Y Rate Explanation: Note 4 – Indirect Cost Rate Confluence Health System has elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Schedule was restated to add the HRSA COVID-19 Uninsured Program, ALN # 93.461 after identifying the program was improperly excluded from the originally issued Schedule.

Finding Details

Finding 2020-001 Preparation of the Schedule Expenditures of Federal Awards – Material Weakness in Internal Control Over Compliance Program: U.S. Department of Health and Human Services HRSA COVID-19 Uninsured Program ALN 93.461 Award year: 2020 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, Confluence Health (the Health System) is required to maintain a structure of internal control to ensure compliance with applicable reporting requirements. Condition/Cause: The Health System did not have sufficient controls to ensure the SEFA included all expenditures that qualified as an expenditure of a federal award during the period. Effect: The SEFA was revised to include $1,019,828 of expenditures related to ALN #93.461, HRSA COVID-19 Uninsured Program, which resulted in an additional major program and the reissuance of the 2020 reporting package. Questioned Costs: Not applicable. Context: Factors contributing to the condition included the high volume of activity related to new COVID-19 programs and the lack of understanding that the related payments represented grant expenditures from a Federal source that were required to be reported on the SEFA. Repeat Finding: Not applicable. Recommendation: We recommend the Health System develop and implement a review process through the year to ensure compliance with SEFA reporting requirements as outlined in the Uniform Guidance. Views of Responsible Officials: Processes will be put in place to compile the SEFA, reconcile to support, and perform a related review prior to audit. This will allow all grants from a Federal source to be identified and tracked, ensuring completeness.
Finding 2020-001 Preparation of the Schedule Expenditures of Federal Awards – Material Weakness in Internal Control Over Compliance Program: U.S. Department of Health and Human Services HRSA COVID-19 Uninsured Program ALN 93.461 Award year: 2020 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, Confluence Health (the Health System) is required to maintain a structure of internal control to ensure compliance with applicable reporting requirements. Condition/Cause: The Health System did not have sufficient controls to ensure the SEFA included all expenditures that qualified as an expenditure of a federal award during the period. Effect: The SEFA was revised to include $1,019,828 of expenditures related to ALN #93.461, HRSA COVID-19 Uninsured Program, which resulted in an additional major program and the reissuance of the 2020 reporting package. Questioned Costs: Not applicable. Context: Factors contributing to the condition included the high volume of activity related to new COVID-19 programs and the lack of understanding that the related payments represented grant expenditures from a Federal source that were required to be reported on the SEFA. Repeat Finding: Not applicable. Recommendation: We recommend the Health System develop and implement a review process through the year to ensure compliance with SEFA reporting requirements as outlined in the Uniform Guidance. Views of Responsible Officials: Processes will be put in place to compile the SEFA, reconcile to support, and perform a related review prior to audit. This will allow all grants from a Federal source to be identified and tracked, ensuring completeness.