Audit 390935

Criteria: The U.S. Department of Health and Human Services' Uniform Administrative Requirements, has strick requirements for advances through the Payment Management System (PMS), primarily aimed at minimizing time between fund transfer and disbursement. Advance payment must be limited to the minimum amount needed; funds must be timed to be in accordance with the actual immediate cash requirements; and advances should be disbursed within three business days of drawdown. Any amount not spent within the three business days of drawdown should be returned. Condition: An advance was drawn down from the PMS in an amount greater than needed and was not spent within the three business days after the drawdown. In addition, the remaining amount not spent within the three business days was not returned immediately to the PMS. Cause and Effect: An advance was drawn down from the PMS in an amount greater than needed and was not spent within the three business days after the drawdown. In addition, the remaining amount not spent within the three business days was not returned immediately to the PMS. This resulted in compliance not being met concerning the advance. Identification of a Repeat Finding: This is not a repeat finding. Recommendation: We recomment that the Council establish internal control guidelines concerning advances from the PMS. The Council should only request advances from the PMS for amounts needed and at a time in which funds will be disbursed within the three business days of the drawdown. View of Responsible Officials: The Council is aware of the finding and has provided a corrective action plan.