Audit 36980

Finding 2022-002 Material Weakness in Internal Control over Compliance, Noncompliance - Reporting Agency U.S. Department of Health and Human Services ALN 93.498 Program Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Criteria 45 CFR 75.303, Internal Controls, states, in part: ?The non-federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)?? 45 CFR 75.342 Monitoring and reporting program performance, states in part: ?(a) Monitoring by the non-Federal entity. The non-Federal entity is responsible for oversight of the operations of the Federal award supported activities. The non-Federal entity must monitor its activities under Federal awards to assure compliance with applicable Federal requirements and performance expectations are being achieved. Monitoring by the non-Federal entity must cover each program, function or activity?? Recipients of the COVID-19 Provider Relief Fund and ARP Rural Distribution under Assistance Listing Number 93.498 are required to submit a report through Health Resources and Services Administration (HRSA) Provider Relief Fund (PRF) Report Portal (Portal), where total Provider Relief Fund expenses and lost revenues during the period of availability, are reported in accordance with HRSA?s PRF Reporting Portal User Guide. Condition Hope Community Resources originally applied for PRF based on actual lost revenues calculation but did not enter actual lost revenue into the Portal. During our examination of Hope Community Resources special reporting requirements to the PRF Portal, we identified that for the Period 2 of reporting, Hope Community Resources applied $996,428 of their PRF funds to other COVID-19 healthcare expenses and reported all expenses as 2020 Quarter 3 and 4 expenses in the portal. Hope Community Resources did not maintain adequate documentation supporting the PRF expenses reported as 2020 Quarter 3 and 4 expenses as Hope Community Resources intent was to report actual lost revenue, and not expenses. We examined the Company?s lost revenues analysis and concluded that Hope Community Resources did have sufficient lost revenues that should have been reported to the Portal for their Period 2 submission. Cause Reporting error was due to confusion with reporting submission website. Grantee believed lost revenue to be considered an expense for reporting purposes. Reporting lost revenue as expenses resulted in reporting site to not prompt for further information regarding lost revenue. Effect or potential effect Hope Community Resource?s Period 2 Portal submission was inaccurately submitted due to the claim of COVID-19 expenses with inadequate support, instead of actual lost revenue. However, the overall effect on the total PRF claimed would not have been changed, as the actual lost revenues were greater than the PRF monies received. Questioned Costs None Context The use of provider relief funds was to be reported annually based upon when funds were received. The use of the funds was mistakenly reported as having been used to pay for expenditures in place of their actual use of replacing lost revenue. Identification as a repeat finding No Recommendation In order to facilitate accurate reporting and compliance with terms and conditions of federal awards, we recommend management implements a process by which submissions are reviewed and assessed in its entirety to ensure submitted information agrees with the supporting documentation. Views of responsible officials Management acknowledges the observed recommendation and will continue measures to ensure future submissions are submitted in accordance with all applicable regulations.

Finding 2022-003 Significant Deficiency in Internal Control over Compliance, Noncompliance ? Reporting Agency U.S. Department of Health and Human Services ALN 93.498 Program Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Criteria Hope Community Resources is required to submit the single audit report and Form SF-SAC within nine months of the fiscal year end or by any Office of Management and Budget extended deadlines. Cause The audit was not completed in time to file the form, due to a delay in closing the books and records. Effect or potential effect Hope was not able to file the Form FS-SAC by the required time. Questioned costs None Context The Form SF-SAC is due nine months after the fiscal year-end. The form for the fiscal year ended June 30, 2022 was filed late. Identification as a repeat finding No Recommendation We recommend Hope to implement internal control procedures to ensure timely closing of books and records to ensure timely submission of the form SF-SAC in the future. Views of Responsible Officials Management acknowledges the observed recommendation. Management will ensure timely year end closing and review of audit schedules to ensure timely reporting.

Finding 2022-002 Material Weakness in Internal Control over Compliance, Noncompliance - Reporting Agency U.S. Department of Health and Human Services ALN 93.498 Program Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Criteria 45 CFR 75.303, Internal Controls, states, in part: ?The non-federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)?? 45 CFR 75.342 Monitoring and reporting program performance, states in part: ?(a) Monitoring by the non-Federal entity. The non-Federal entity is responsible for oversight of the operations of the Federal award supported activities. The non-Federal entity must monitor its activities under Federal awards to assure compliance with applicable Federal requirements and performance expectations are being achieved. Monitoring by the non-Federal entity must cover each program, function or activity?? Recipients of the COVID-19 Provider Relief Fund and ARP Rural Distribution under Assistance Listing Number 93.498 are required to submit a report through Health Resources and Services Administration (HRSA) Provider Relief Fund (PRF) Report Portal (Portal), where total Provider Relief Fund expenses and lost revenues during the period of availability, are reported in accordance with HRSA?s PRF Reporting Portal User Guide. Condition Hope Community Resources originally applied for PRF based on actual lost revenues calculation but did not enter actual lost revenue into the Portal. During our examination of Hope Community Resources special reporting requirements to the PRF Portal, we identified that for the Period 2 of reporting, Hope Community Resources applied $996,428 of their PRF funds to other COVID-19 healthcare expenses and reported all expenses as 2020 Quarter 3 and 4 expenses in the portal. Hope Community Resources did not maintain adequate documentation supporting the PRF expenses reported as 2020 Quarter 3 and 4 expenses as Hope Community Resources intent was to report actual lost revenue, and not expenses. We examined the Company?s lost revenues analysis and concluded that Hope Community Resources did have sufficient lost revenues that should have been reported to the Portal for their Period 2 submission. Cause Reporting error was due to confusion with reporting submission website. Grantee believed lost revenue to be considered an expense for reporting purposes. Reporting lost revenue as expenses resulted in reporting site to not prompt for further information regarding lost revenue. Effect or potential effect Hope Community Resource?s Period 2 Portal submission was inaccurately submitted due to the claim of COVID-19 expenses with inadequate support, instead of actual lost revenue. However, the overall effect on the total PRF claimed would not have been changed, as the actual lost revenues were greater than the PRF monies received. Questioned Costs None Context The use of provider relief funds was to be reported annually based upon when funds were received. The use of the funds was mistakenly reported as having been used to pay for expenditures in place of their actual use of replacing lost revenue. Identification as a repeat finding No Recommendation In order to facilitate accurate reporting and compliance with terms and conditions of federal awards, we recommend management implements a process by which submissions are reviewed and assessed in its entirety to ensure submitted information agrees with the supporting documentation. Views of responsible officials Management acknowledges the observed recommendation and will continue measures to ensure future submissions are submitted in accordance with all applicable regulations.

Finding 2022-003 Significant Deficiency in Internal Control over Compliance, Noncompliance ? Reporting Agency U.S. Department of Health and Human Services ALN 93.498 Program Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Criteria Hope Community Resources is required to submit the single audit report and Form SF-SAC within nine months of the fiscal year end or by any Office of Management and Budget extended deadlines. Cause The audit was not completed in time to file the form, due to a delay in closing the books and records. Effect or potential effect Hope was not able to file the Form FS-SAC by the required time. Questioned costs None Context The Form SF-SAC is due nine months after the fiscal year-end. The form for the fiscal year ended June 30, 2022 was filed late. Identification as a repeat finding No Recommendation We recommend Hope to implement internal control procedures to ensure timely closing of books and records to ensure timely submission of the form SF-SAC in the future. Views of Responsible Officials Management acknowledges the observed recommendation. Management will ensure timely year end closing and review of audit schedules to ensure timely reporting.