Audit 357407

FY End

2024-12-31

Total Expended

$48.75M

Findings

2

Programs

1

Organization: Ozarks Medical Center (MO)

Year: 2024 Accepted: 2025-05-29

Auditor: Cliftonlarsonallen

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
561750	2024-003	Significant Deficiency	-	C
1138192	2024-003	Significant Deficiency	-	C

ALN	Program	Spent	Major	Findings
10.766	Community Facilities Loans and Grants	$48.75M	Yes	1

Contacts

Name	Title	Type
UMUTULYLU967	Michael Durr	Auditee
4172575801	Joshua Wilks	Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 BASIS OF PRESENTATION Accounting Policies: NOTE 1 BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Ozarks Medical Center’s (the Medical Center) and is presented on the accrual basis of accounting. The information in this Schedule is presented in accordance with the applicable requirements of Title 2 U.S. Code of Federal Regulations 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 the Medical Center, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Medical Center. De Minimis Rate Used: Y Rate Explanation: The Medical Center has elected to use the 10% de minimis indirect cost rate allowable under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Ozarks Medical Center’s (the Medical Center) and is presented on the accrual basis of accounting. The information in this Schedule is presented in accordance with the applicable requirements of Title 2 U.S. Code of Federal Regulations 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 the Medical Center, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Medical Center.

Title: NOTE 2 SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: NOTE 1 BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Ozarks Medical Center’s (the Medical Center) and is presented on the accrual basis of accounting. The information in this Schedule is presented in accordance with the applicable requirements of Title 2 U.S. Code of Federal Regulations 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 the Medical Center, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Medical Center. De Minimis Rate Used: Y Rate Explanation: The Medical Center has elected to use the 10% de minimis indirect cost rate allowable under the Uniform Guidance. No funds were identified as having been provided to subrecipients by the Medical Center and accordingly, no funds identified in the Schedule are attributable to subrecipient entities. There were no federal awards expended for noncash assistance or insurance. The Medical Center has elected to use the 10% de minimis indirect cost rate allowable under the Uniform Guidance.

Title: NOTE 3 LOAN BALANCE Accounting Policies: NOTE 1 BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Ozarks Medical Center’s (the Medical Center) and is presented on the accrual basis of accounting. The information in this Schedule is presented in accordance with the applicable requirements of Title 2 U.S. Code of Federal Regulations 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 the Medical Center, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Medical Center. De Minimis Rate Used: Y Rate Explanation: The Medical Center has elected to use the 10% de minimis indirect cost rate allowable under the Uniform Guidance. The amount in the accompanying Schedule represents the highest loan balances during the year under audit. The outstanding loan balances at December 31, 2024 was $47,332,517.

Finding Details

Finding 2024-003

Federal Agency: U.S. Department of Agriculture Program Title: Community Facilities Loans and Grants Assistance Listing Number: 10.766 Award Period: January 1, 2024 to December 31, 2024 Type of Finding: Compliance and Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Under the terms and conditions of the agreements with the USDA the Medical Center is required to meet minimum requirements of Historical Debt Service Coverage Ratio of 1.25 and fund certain Debt Service, Reserve and Replacement accounts. Condition: The Medical Center failed to meet the minimum Historical Debt Service Coverage Ratio and has not funded the required reserve accounts for the year ended December 31, 2024. Questioned costs: None Cause: The Medical Center has experienced financial challenges since the inflationary pressures associated with the COVID-19 pandemic which has negatively impacted operating results. The Medical Center understood that the USDA did not require them to fund the required accounts under the agreement given the historical level of investments maintained by the Medical Center. Effect: The Medical Center is not in compliance with the terms and conditions of the agreement. Recommendation: Management should continue to focus on making operational improvements to achieve the minimum level of Historical Debt Service Coverage of 1.25, as required, and work with the USDA to determine what reserve accounts are required, or to the extent they are not required, properly document that understanding in writing with the USDA.

Finding 2024-003

Federal Agency: U.S. Department of Agriculture Program Title: Community Facilities Loans and Grants Assistance Listing Number: 10.766 Award Period: January 1, 2024 to December 31, 2024 Type of Finding: Compliance and Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: Under the terms and conditions of the agreements with the USDA the Medical Center is required to meet minimum requirements of Historical Debt Service Coverage Ratio of 1.25 and fund certain Debt Service, Reserve and Replacement accounts. Condition: The Medical Center failed to meet the minimum Historical Debt Service Coverage Ratio and has not funded the required reserve accounts for the year ended December 31, 2024. Questioned costs: None Cause: The Medical Center has experienced financial challenges since the inflationary pressures associated with the COVID-19 pandemic which has negatively impacted operating results. The Medical Center understood that the USDA did not require them to fund the required accounts under the agreement given the historical level of investments maintained by the Medical Center. Effect: The Medical Center is not in compliance with the terms and conditions of the agreement. Recommendation: Management should continue to focus on making operational improvements to achieve the minimum level of Historical Debt Service Coverage of 1.25, as required, and work with the USDA to determine what reserve accounts are required, or to the extent they are not required, properly document that understanding in writing with the USDA.