Audit 393943

ALN, Federal Agency, and Program Name – 93.912, U.S. Department of Health and Human Services, Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement Federal Award Identification Number and Year – HB1RH49873-01 & HB1RH49873-02, 2025 & 2025 Pass through Entity – N/A Finding Type – Material weakness and material noncompliance with laws and regulations Repeat Finding – No Criteria – Per the FFATA Act (Pub. L. 109–282) and 2 CFR § 170.200–220, recipients of federal awards must report applicable subaward data in SAM.gov in a timely and accurate manner. The reporting requirement applies to all active federal awards subject to FFATA. Condition – Testing identified that the Organization issued subawards under ALN 93.912 but did not submit the required FFATA subaward reports to SAM.gov during the audit period. After identification of this noncompliance, the Organization submitted the required FFATA subaward report to SAM.gov. Questioned Costs – None If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported - N/A Identification of How Questioned Costs Were Computed - N/A Context – During the audit period, the Organization received federal funding under the Rural Health Care Services Outreach Program (ALN 93.912) from the U.S. Department of Health and Human Services. As part of carrying out the grant, the Organization issued a subaward to a clinic to support program objectives. Because the subaward exceeded the $30,000 reporting threshold, the Organization was required to submit subaward information in the FFATA Subaward Reporting System (SAM.gov) no later than the end of the month following each subaward obligation. The following table summarizes the transactions examined and the non-compliance identified: Cause and Effect - The Organization lacked internal controls to ensure FFATA reporting requirements were identified and monitored. Responsibilities for FFATA reporting were not assigned, and no procedures were in place to track subawards or trigger reporting obligations. Failure to submit FFATA reports timely results in noncompliance with federal transparency requirements and limits publicly available information regarding federal subaward spending. Recommendation – The Organization should develop and implement internal controls to ensure compliance with FFATA reporting requirements, including assigning responsibility for tracking subaward obligations, establishing procedures for timely SAM.gov reporting, and performing periodic monitoring to verify ongoing compliance. Views of Responsible Officials and Corrective Action Plan – Management accepts the finding and has already taken steps to file the missing report and update their policies to ensure all future reports are filed as required.