FAC Explorer

Audit 357538

FY End
2024-12-31
Total Expended
$354.33M
Findings
2
Programs
2
Organization: Community Memorial Health System (CA)
Year: 2024 Accepted: 2025-05-29
Auditor: Moss Adams LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
561883 2024-001 Significant Deficiency - L
1138325 2024-001 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
14.128 Mortgage Insurance Hospitals $340.85M Yes 1
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $13.48M - 0

Contacts

Name Title Type
XGPNUKYQMJH9 Vincent Wong Auditee
8059485119 Stelian Damu Auditor
No contacts on file

Notes to SEFA

Title: Note 1 – Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Under the accrual basis of accounting, expenditures are recognized when incurred. 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. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Community Memorial Health System (the Organization) under programs of the federal government for the year ended December 31, 2024. The information in this Schedule is presented in accordance with the requirements of the 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 the Organization, it is not intended to and does not present the consolidated financial position, results of operations, or cash flows of the Organization. The Organization’s reporting entity is defined in Note 1 of the consolidated financial statements. All federal awards from federal agencies are included in the Schedule.
Title: Note 3 – Loan Balance Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Under the accrual basis of accounting, expenditures are recognized when incurred. 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. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. Loans outstanding at the beginning of the year plus the new value of new loans received during the year are included in the federal expenditures presented in the schedule of expenditures of federal awards. The balance of the loans outstanding as of December 31, 2024, consisted of: See the Notes to the SEFA for chart/table
Title: Note 4 – Subrecipient Awards Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Under the accrual basis of accounting, expenditures are recognized when incurred. 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. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The Organization did not provide any federal awards to subrecipients during the year ended December 31, 2024.

Finding Details

Finding 2024-001
FINDING 2024-001 – Significant deficiency in internal controls over compliance and noncompliance over submission of required reports Federal Award: Assistance Listing Number: 14.128 Mortgage Insurance Program Criteria: The Hospital Regulatory Agreement requires the following to be filed with HUD and Lender: (i) Annual audited financial statements from a certified public accountant or other person acceptable to HUD in accordance with program obligations. (ii) Board-certified annual financial statements within 120 days following the close of the borrower’s fiscal year if the annual audited financial statements have not yet been provided to HUD and Lender, or anytime at HUD’s and Lender’s request. (iii) Monthly unaudited financial statements 40 days following the end of the month, in accordance with program obligations, until final endorsement has occurred, or at HUD’s request. (iv) Quarterly unaudited financial statements and utilization statistics within 40 days following the end of each quarter of the borrower’s fiscal year, in accordance with program obligations. Condition/Context: During our testing of the reporting requirement, we tested four quarterly reports and one annual report (100% of the population). We observed that although board approval was received prior to the due date, the annual board-certified financial statements were submitted five days (three business days) after the deadline required by the Hospital Regulatory Agreement. Cause: Management did not have effective internal controls in place to ensure the report was submitted in accordance with the Hospital Regulatory Agreement. Effect: Because there were not effective internal controls in place, the annual board-certified report was submitted past the date required by the Hospital Regulatory Agreement. Questioned Costs: Not applicable. Repeating Finding: Not applicable. Recommendation: We recommend that management implement internal controls to ensure that the required reports are submitted by the deadlines agreed to in the Hospital Regulatory Agreement. View of responsible officials and planned corrective actions: Although the circumstances were unique due to implementation of a new electronic health record system, additional personnel will be involved to ensure redundancy, completion, and compliance with the annual reporting requirement.
Finding 2024-001
FINDING 2024-001 – Significant deficiency in internal controls over compliance and noncompliance over submission of required reports Federal Award: Assistance Listing Number: 14.128 Mortgage Insurance Program Criteria: The Hospital Regulatory Agreement requires the following to be filed with HUD and Lender: (i) Annual audited financial statements from a certified public accountant or other person acceptable to HUD in accordance with program obligations. (ii) Board-certified annual financial statements within 120 days following the close of the borrower’s fiscal year if the annual audited financial statements have not yet been provided to HUD and Lender, or anytime at HUD’s and Lender’s request. (iii) Monthly unaudited financial statements 40 days following the end of the month, in accordance with program obligations, until final endorsement has occurred, or at HUD’s request. (iv) Quarterly unaudited financial statements and utilization statistics within 40 days following the end of each quarter of the borrower’s fiscal year, in accordance with program obligations. Condition/Context: During our testing of the reporting requirement, we tested four quarterly reports and one annual report (100% of the population). We observed that although board approval was received prior to the due date, the annual board-certified financial statements were submitted five days (three business days) after the deadline required by the Hospital Regulatory Agreement. Cause: Management did not have effective internal controls in place to ensure the report was submitted in accordance with the Hospital Regulatory Agreement. Effect: Because there were not effective internal controls in place, the annual board-certified report was submitted past the date required by the Hospital Regulatory Agreement. Questioned Costs: Not applicable. Repeating Finding: Not applicable. Recommendation: We recommend that management implement internal controls to ensure that the required reports are submitted by the deadlines agreed to in the Hospital Regulatory Agreement. View of responsible officials and planned corrective actions: Although the circumstances were unique due to implementation of a new electronic health record system, additional personnel will be involved to ensure redundancy, completion, and compliance with the annual reporting requirement.