Audit 37605

FY End
2022-06-30
Total Expended
$4.70M
Findings
4
Programs
2
Organization: Rolette Community Care Center (ND)
Year: 2022 Accepted: 2023-03-30
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
39964 2022-004 Material Weakness - P
39965 2022-004 Material Weakness - P
616406 2022-004 Material Weakness - P
616407 2022-004 Material Weakness - P

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $4.54M Yes 1
93.498 Provider Relief Fund $160,431 - 1

Contacts

Name Title Type
K9TLLTF5C136 Kathy Morrow Auditee
7012463786 Renee Gravalin Auditor
No contacts on file

Notes to SEFA

Title: Loan Programs Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Expenditures reported on the Schedule consist of 90% of the beginning of the year outstanding balance of the Care Centers USDA guaranteed loan. The total outstanding balance of the loan as of July 1, 2021, was $5,040,653, of which 90% is$4,536,588 and is the amount reported on the Schedule. If applicable, 90% of any advances made on the loan during the year would also be reported on the Schedule. The outstanding balance of the Care Centers USDA guaranteed loan as of June 30, 2022, was $4,873,227, of which 90% totals $4,385,904.
Title: Basis of Presentation Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Rolette Community Care Center, Inc. (Care Center) under programs of the federal government for the year ended June 30, 2022. 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 Care Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Care Center.
Title: Provider Relief Funds Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Care Center received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan (PRF) program. (Federal Financial Assistance Listing/CFDA #93.498) The PRF expenditures were recognized on the Schedule when the expenditures were included in the reporting to HHS for Period 2 and Period 3, defined as payments received between July 1, 2020 and June 30, 2021. As the total amount of $160,431 was included on the Period 2 and Period 3 reports submitted to HHS, that amount is shown on the accompanying Schedule.

Finding Details

2022-004 Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Department of Health and Human Services Federal Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 2 and Period 3 TIN #205330283 Preparation of Schedule of Expenditures of Federal Awards Material Weakness in Internal Control over Compliance ? Other Criteria-Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition- The Care Center does not have an internal control system designed to provide for a complete and accurate schedule of expenditures of federal awards being audited. The Care Center requested Eide Bailly LLP to draft the Schedule. Cause-Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Care Center meets a specified threshold of federal expenditures. Effect-There is a reasonable possibility that the Care Center would not be able to draft the Schedule and the accompanying notes to the Schedule that is correct without the assistance of the auditors. Questioned Costs-None Reported. Context-Sampling was not used. Repeat Finding from Prior Years-No. Recommendation-We recommend management be aware of the financial reporting requirements relating to the Care Center?s schedule of expenditures of federal awards and the internal controls that impact financial reporting. View of Responsible Officials-Management agrees with the finding.
2022-004 Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Department of Health and Human Services Federal Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 2 and Period 3 TIN #205330283 Preparation of Schedule of Expenditures of Federal Awards Material Weakness in Internal Control over Compliance ? Other Criteria-Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition- The Care Center does not have an internal control system designed to provide for a complete and accurate schedule of expenditures of federal awards being audited. The Care Center requested Eide Bailly LLP to draft the Schedule. Cause-Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Care Center meets a specified threshold of federal expenditures. Effect-There is a reasonable possibility that the Care Center would not be able to draft the Schedule and the accompanying notes to the Schedule that is correct without the assistance of the auditors. Questioned Costs-None Reported. Context-Sampling was not used. Repeat Finding from Prior Years-No. Recommendation-We recommend management be aware of the financial reporting requirements relating to the Care Center?s schedule of expenditures of federal awards and the internal controls that impact financial reporting. View of Responsible Officials-Management agrees with the finding.
2022-004 Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Department of Health and Human Services Federal Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 2 and Period 3 TIN #205330283 Preparation of Schedule of Expenditures of Federal Awards Material Weakness in Internal Control over Compliance ? Other Criteria-Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition- The Care Center does not have an internal control system designed to provide for a complete and accurate schedule of expenditures of federal awards being audited. The Care Center requested Eide Bailly LLP to draft the Schedule. Cause-Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Care Center meets a specified threshold of federal expenditures. Effect-There is a reasonable possibility that the Care Center would not be able to draft the Schedule and the accompanying notes to the Schedule that is correct without the assistance of the auditors. Questioned Costs-None Reported. Context-Sampling was not used. Repeat Finding from Prior Years-No. Recommendation-We recommend management be aware of the financial reporting requirements relating to the Care Center?s schedule of expenditures of federal awards and the internal controls that impact financial reporting. View of Responsible Officials-Management agrees with the finding.
2022-004 Department of Agriculture Federal Assistance Listing #10.766 Community Facilities Loans and Grants Department of Health and Human Services Federal Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 2 and Period 3 TIN #205330283 Preparation of Schedule of Expenditures of Federal Awards Material Weakness in Internal Control over Compliance ? Other Criteria-Proper controls over financial reporting include the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition- The Care Center does not have an internal control system designed to provide for a complete and accurate schedule of expenditures of federal awards being audited. The Care Center requested Eide Bailly LLP to draft the Schedule. Cause-Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Care Center meets a specified threshold of federal expenditures. Effect-There is a reasonable possibility that the Care Center would not be able to draft the Schedule and the accompanying notes to the Schedule that is correct without the assistance of the auditors. Questioned Costs-None Reported. Context-Sampling was not used. Repeat Finding from Prior Years-No. Recommendation-We recommend management be aware of the financial reporting requirements relating to the Care Center?s schedule of expenditures of federal awards and the internal controls that impact financial reporting. View of Responsible Officials-Management agrees with the finding.