FAC Explorer

Audit 38292

FY End
2022-12-31
Total Expended
$5.33M
Findings
2
Programs
7
Organization: Freeport Regional Health Care Foundation and Subsidiaries (IL)
Year: 2022 Accepted: 2023-09-30
Auditor: Rsm US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
41940 2022-001 - - L
618382 2022-001 - - L

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $4.55M Yes 1
93.461 Hrsa Covid-19 Claims Reimbursement for the Uninsured Program and the Covid-19 Coverage Assistance Fund $259,065 - 0
93.667 Social Services Block Grant $189,366 - 0
93.959 Block Grants for Prevention and Treatment of Substance Abuse $171,278 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $108,536 - 0
10.855 Distance Learning and Telemedicine Loans and Grants $41,404 - 0
93.958 Block Grants for Community Mental Health Services $9,333 - 0

Contacts

Name Title Type
CWNPK67MNA78 Angie Meade Auditee
8155996366 Ryan Caldwell Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. 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 Freeport Regional Health Care Foundation and Subsidiaries d/b/a FHN (the Foundation) under programs of the federal government for the year ended December 31, 2022. The information in the Schedule 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 Foundation, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the Foundation.
Title: Non-Cash Assistance, Insurance, Loans and Loan Guarantees Outstanding Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Foundation did not receive any non-cash assistance during the year ended December 31, 2022. The Foundation did not have any federal insurance in effect during the year ended December 31, 2022, nor were there any loans or loan guarantees at year-end.
Title: Subrecipients Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Foundation did not pass-through any federal awards to subrecipients during the year ended December 31, 2022.
Title: Provider Relief Fund Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Under terms and conditions of the Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution program (PRF) (ALN #93.498), the Foundation is required to report COVID-19 related expenses and lost revenue to the U.S. Department of Health and Human Services (HHS). Guidance from HHS has required the reporting of the COVID-19 related expenses and lost revenue in certain reporting periods based on when the funds were received.During the year ended December 31, 2021, the Foundation received PRF distributions of $4,552,580, all of which was recognized as revenue in the Foundations December 31, 2021 consolidated financial statements as the terms and conditions of the PRF grant were satisfied. HHS requires $4,552,580 received from HHS between January 1, 2021 through December 31, 2021, to be reported in the accompanying December 31, 2022 Schedule.During the year ended December 31, 2022, the Foundation received PRF distributions of $591,327, all of which was recognized as revenue in the Foundations December 31, 2022 consolidated financial statements as the terms and conditions of the PRF grant were satisfied. HHS requires $591,327 received from HHS between January 1, 2022 through December 31, 2022, to be reported in a future Schedule, if required.

Finding Details

Finding 2022-001
Section III?Federal Award Findings and Questioned Costs Federal Agency: U.S. Department of Health and Human Services Program Name: COVID-19, Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Assistance Listing Number: 94.498 Finding 2022-001: Overstatement of expenses Repeat Finding: No. "Criteria: 2 CFR Part 200.303(a) states that the auditee must establish and maintain effective internal control over the federal awards that provides reasonable assurance that the auditee is managing the federal award in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Specific criteria established by the Health Resources and Services Administrations (HRSA) reporting guidance, establishes that providers who accept PRF Payments agree to the Terms and Conditions of the Program, which included a requirement for providers to report on the use of funds. Providers who receive one or more payments totaling greater than $10,000 in the aggregate during a payment received period must report on use of funds in each applicable reporting period. " Condition: Amounts reported as General and Administrative expenses and Healthcare Related expenses that were reported in Period 2 in the Provider Relief Fund Reporting Portal (the "Portal") were also reported in Period 4 in the Portal. Cause: Subsequent to the Period 4 submission to the Portal, management identified that the amounts reported as General and Administrative expenses and Healthcare Related expenses for Q3 and Q4 2021 were inadvertently submitted to both Period 2 and Period 4 in the Portal. Effect: Expenses reported as General and Administrative expenses and Healthcare Related expenses in Period 4 in the Portal were overstated by approximately $42,000. Questioned costs: None. Context: Expenses reported as General and Administrative expenses and Healthcare Related expenses of approximately $42,000 out of total eligible expenses reported to the Portal for Period 4 of $3,916,670 were overstated as they had been previously reported in Period 2 to the Portal. Recommendation: We recommend management review and strengthen its internal control review process over reporting. Views of responsible officials: Management concurs with the finding presented above.
Finding 2022-001
Section III?Federal Award Findings and Questioned Costs Federal Agency: U.S. Department of Health and Human Services Program Name: COVID-19, Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Assistance Listing Number: 94.498 Finding 2022-001: Overstatement of expenses Repeat Finding: No. "Criteria: 2 CFR Part 200.303(a) states that the auditee must establish and maintain effective internal control over the federal awards that provides reasonable assurance that the auditee is managing the federal award in compliance with the federal statutes, regulations, and terms and conditions of the federal award. Specific criteria established by the Health Resources and Services Administrations (HRSA) reporting guidance, establishes that providers who accept PRF Payments agree to the Terms and Conditions of the Program, which included a requirement for providers to report on the use of funds. Providers who receive one or more payments totaling greater than $10,000 in the aggregate during a payment received period must report on use of funds in each applicable reporting period. " Condition: Amounts reported as General and Administrative expenses and Healthcare Related expenses that were reported in Period 2 in the Provider Relief Fund Reporting Portal (the "Portal") were also reported in Period 4 in the Portal. Cause: Subsequent to the Period 4 submission to the Portal, management identified that the amounts reported as General and Administrative expenses and Healthcare Related expenses for Q3 and Q4 2021 were inadvertently submitted to both Period 2 and Period 4 in the Portal. Effect: Expenses reported as General and Administrative expenses and Healthcare Related expenses in Period 4 in the Portal were overstated by approximately $42,000. Questioned costs: None. Context: Expenses reported as General and Administrative expenses and Healthcare Related expenses of approximately $42,000 out of total eligible expenses reported to the Portal for Period 4 of $3,916,670 were overstated as they had been previously reported in Period 2 to the Portal. Recommendation: We recommend management review and strengthen its internal control review process over reporting. Views of responsible officials: Management concurs with the finding presented above.