Audit 374614

Finding: 2025-005-Reporting Federal Programs: Department of Health and Human Services Health Center Program Cluster Assistance Listing No. 93.224 and 93.527 Criteria: Organizations that receive federal awards in excess of $750,000 are required to submit an annual Federal Data Collection Form, including audited financial statements, no later than nine months after their fiscal year-end to the Federal Audit Clearinghouse. Condition: The Federal Data Collection Form and audit report for the year ended May 31, 2024, were not submitted to the Federal Audit Clearinghouse until April 4, 2025, which was beyond the filing period of January 31, 2025. Cause: The late issuance of the Organization’s audited financial statements for the year ended May 31, 2024 was a result of the changeover of key personnel during the year. Effect: The Organization is not in compliance with federal filing requirements, which could impact availability of federal funds. Questioned Costs: None reported. Context/Sampling: None Repeat Finding from Prior Year: No Recommendation: It is recommended that the annual audit and Federal Data Collection Form be completed and filed in a timely manner. Views of Responsible Officials: Management concurs. The Organization will ensure that the 2025 audit and Federal Data Collection Form is completed in a timely manner. Contact Person: Amanda Duke, COO Anticipated Date of Completion: January 31, 2026

Finding: 2025-006 Preparation and Submission of Medicare Cost Report Federal Programs: Department of Health and Human Services Health Center Program Cluster Assistance Listing No. 93.224 and 93.527 Criteria: Management is responsible for adhering to all requirements stipulated by contracts with various payers. One such requirement is the annual filing of the Medicare cost report as required by the Organization’s contracts with the Centers for Medicare and Medicaid Services (CMS). Condition: The Organization’s Medicare cost report for the year ended May 31, 2024 was not filed within five months of the fiscal year end. Cause: The Organization failed to file the Medicare cost report timely as required by contracts with CMS. Effect: CMS withheld outstanding payments due to the organization until the Medicare cost report was filed, resulting in large receivable balances and restricted cash flows. Due to the size and volume of the Organization’s transactions with CMS, this could have a detrimental effect on the Organization’s operations. Questioned Costs: None reported. Context/Sampling: None Repeat Finding from Prior Year: No Recommendation: Management should design and implement controls to ensure that the Medicare and Medicaid cost reports are filed on or before their annual due date to ensure timely collections of settlements and to prevent withholding of claim payments by CMS. Views of Responsible Officials: Management concurs. The Organization will design and implement controls to ensure that the Medicare and Medicaid cost reports are filed in a timely manner. Contact Person: Amanda Duke, COO Anticipated Date of Completion: January 31, 2026

Finding: 2025-007 Monthly Time/Activity Reports not Maintained for Salaried Employees Federal Program Identification: U.S. Department of Health and Human Services Health Center Program Cluster Assistance Listing No. 93.224 and 93.527 Criteria: Uniform Guidance Compliance Supplement, Grant Policy Statements, 45 CFR, 75.430 Condition: Time/activity reports (time sheets) are not maintained for salaried employees as required by federal cost principles. Cause: The Organization’s policy did not require that salaried employees maintain time and effort reports that coincide with the Organization’s payroll cycle (at least on a monthly basis). Effect: Failure to comply with federal requirements regarding personnel cost and time and effort could result in a reduction of grant funds. Questioned Costs: None Context/Sampling: A test of payroll disbursements revealed that time and effort certifications for salaried employees were not maintained. The finding appears to be a systemic issue. Repeat Finding from Prior Year: Yes Recommendation: The Organization should evaluate and revise its policies to ensure that the policies require personnel to document time and efforts in accordance with federal cost principles. Procedures should subsequently be established to ensure that all salaried employees maintain time and effort reports in accordance with the revised policy. It is recommended that time and effort certifications be prepared no less than monthly and coincide with the Organization’s payroll cycle. Views of Responsible Officials: Policies and procedures will be established to ensure that salaried employees maintain time and effort reports that coincide with the Organization’s payroll cycle. Contact Person: Amanda Duke, COO Anticipated Date of Completion: January 31, 2026

Finding: 2025-008 Cash Management – Federal Grants Federal Programs: Department of Health and Human Services Health Center Program Cluster Assistance Listing No. 93.224 and 93.527 Criteria: Cash Management, 45 CFR 75.305 Condition: During the year, the Organization made several draws of federal funds for which expenditures were not documented at the time of the draw. The Organization is required to identify related expenditures prior to drawing funds from the U.S. Treasury. Cause: The Organization made draws of federal grant funds in advance of documenting the expenditures. Effect: The Organization could have held federal funds for time periods in excess of one business day. Questioned Costs: None reported. Context/Sampling: The finding appears to be a systemic issue. Repeat Finding from Prior Year: Yes Recommendation: The Organization should document qualifying expenditures prior to making the related draws of funds from the U.S. Treasury. Views of Responsible Officials: The Organization understands the requirements to document qualifying expenditures prior to drawing funds from the U.S. Treasury. Procedures will be established to document these expenditures prior to drawing funds from the U.S. Treasury to ensure that advance draws of federal funds do not occur. Contact Person: Amanda Duke, COO Anticipated Date of Completion: January 31, 2026