Audit 371778

FY End

2023-06-30

Total Expended

$16.10M

Findings

2

Programs

1

Organization: Merrill Pioneer Community Hospital, Inc (IA)

Year: 2023 Accepted: 2025-11-04

Auditor: DENOBLE AUSTIN & COMPANY

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
1161858	2023-003	Material Weakness	Yes	L
1161859	2023-004	Material Weakness	Yes	P

ALN	Program	Spent	Major	Findings
10.766	Community Facilities Loans and Grants	$16.10M	Yes	2

Contacts

Name	Title	Type
KQV2YPHNB253	Judy Gacke	Auditee
7124723724	Carmen Austin	Auditor
No contacts on file

Notes to SEFA

The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the Merrill pioneer Community Hospital (Hospital) under programs of the federal government for the year ended June 30, 2023. The information is presented in accordance with the 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 Hospital, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Hospital.

Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient.

The Hospital has elected not to use the 10% de minimis indirect cost rate.

Expenditures reported on this Schedule under the Community Facilities Loans and Grants Program consists of the beginning of the year outstanding loan balance of the Hospital’s USDA direct loans of $16,100,690. If applicable, advances made on the loans during the year are reported on the Schedule. The Hospital made no advances on the loans during the year ended June 30, 2023. The Hospital’s outstanding loan balances for the direct loan as of June 30, 2023, are $15,576,791.

Finding Details

Finding 2023-003

REPORTING: Criteria – Quarterly Income and Expense Statements and an Annual Financial Reporting and Projected Cash Flow need to be completed accurately and timely submitted to the U.S. Department of Agriculture. Also, in accordance with 2 CFR Part 200, loan balances in excess of $750,000 (beginning year balance plus any additional loans issued in a year) must be included in the Schedule of Federal Awards and must meet continuing Single Audit requirements. Condition – The Hospital did not submit any of the required reporting in a timely manner for the fiscal year ended June 30, 2023. Cause – The Hospital does not have established procedures and policies for management oversight of the reporting requirements to ensure all reports are accurately and timely filed. Effect – The Hospital was not in compliance with required provisions of the Federal program. Recommendation – The Hospital should implement proper policies and procedure to ensure the reporting requirements are being met in the future. Client Response – We will implement procedures to comply with all reporting requirements. Conclusion – Response accepted.

Finding 2023-004

WRITTEN PROCEDURES AND POLICIES: Criteria – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over federal awards that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition – The Hospital has not established policies and procedures to monitor Federal awards for compliance with Uniform Guidance requirements. During the fiscal year ended June 30, 2023, the Hospital was not in compliance with reporting due to a lack of monitoring and review of the requirements. Cause – The Hospital has not established specific written policies and procedures relative to the management of federal awards. Effect – The Hospital is not in compliance with Federal regulations pertaining to the management of federal awards as required by the Uniform Guidance. Recommendation – The Hospital should establish written procurement policies and procedures to ensure compliance with the Uniform Guidance requirements. Response – We will develop written procedures and policies as required. Conclusion – Response accepted.