FAC Explorer

Audit 377856

FY End
2025-06-30
Total Expended
$16.39M
Findings
1
Programs
1
Organization: Hegg Memorial Hospital D/b/a Hegg Health Center (IA)
Year: 2025 Accepted: 2025-12-29
Auditor: EIDE BAILLY LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
1166739 2025-003 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
10.766 COMMUNITY FACILITIES LOANS AND GRANTS $16.39M Yes 1

Contacts

Name Title Type
MSNDHLQ9DZX1 Glenn Zevenbergen Auditee
7124768000 Judon Mettler Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Hegg Memorial Hospital d/b/a Hegg Health Center (the Center) under programs of the federal government for the year ended June 30, 2025. 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 Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Center.
Expenditures reported in the schedule consist of the beginning of the year outstanding loan balance for direct loans. The Center has three separate loan balances which comprise the total expenditures reported on the schedule. There were no loan advances during the year ended June 30, 2025. The outstanding balance of the direct loans at June 30, 2025, totaled $15,864,778.

Finding Details

Finding 2025-003
Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Section 4 of the loan resolution security agreement dated December 1, 2016 states the Center must set aside a reserve amount each month until the specified account balance is reached. Condition: The Center’s reserve account is fully funded per the requirements of the loan resolution security agreement. However, there is no documented secondary monitoring of the reserve balance as compared to the required minimum reserve balance. Cause: The reserve balance is maintained within a separate certificate of deposit account with a bank; therefore, there are no monthly reconciliations, and the reserve balance and reserve requirement are not communicated with the board of directors. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management implement procedures to ensure individuals in management review and approve the reserve balance when the certificate of deposit is renewed or present the reserve balance and the reserve requirement to the board during board meetings. Views of Responsible Officials: Management agrees with the finding.