Audit 3969

Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution; Noncompliance Finding/Material Weakness; Activities Allowed Compliance Requirement. Criteria: The Provider Relief Fund (PRF) was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260). The PRFs are to be used to prevent, prepare for, and respond to coronavirus. The PRFs are to reimburse recipients only for health care related expenses or lost revenues that are attributable to coronavirus. The PRF funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. Condition: The Hospital District did not meet the requirement that the PRF funds be used to reimburse expenses that have not been reimbursed by other sources or that other sources are obligated to reimburse. Cause: The Hospital District's summary spreadsheet for tracking federal grant expenditures contained information from multiple sources. When the expenditures were compiled into the summary spreadsheet used for reporting, procedures were not in place to prevent duplication. Effect: The Hospital District duplicated expenditures within the listing of PRF expenditures. Questioned Costs: Known questioned costs are $89,514. The Hospital District had unused lost revenues of $316,395 after reporting period 4 was completed. Therefore, after considering the effects of the known questioned costs identified, the Hospital District would still have unused lost revenues to carryforward to future reporting periods in the amount of $226,881. Perspective Information: The known questioned costs of $89,514 consisted of two separate components. The first component consisted of $87,350 of known questioned costs. Sampling was not necessary on this component as the entire amount was deemed to have been duplicated. The second component consisted of a sample of 10 expenses totaling $23,602 from a population of 80 expenses totaling $87,742. Each item tested in the second component contained a small amount of duplicated expenses. Total duplicated expenses identified were $2,164. The sample was not intended to be a statistically valid sample. Repeat Finding: N/A Recommendations: We recommend policies and procedures over federal grant reporting be strengthened to ensure expenditures are not already included in the federal grant expenses to avoid duplication of expenses. Views of Responsible Officials: The Hospital District agrees with this finding of noncompliance and materialweakness in internal control over compliance and will be implementing a plan of correction to include another individual independent of the reporting process to review the federal grant expenses prior to submission.

Identification: 93.498 United States Department of Health and Human Services, Provider Relief Fund and American Rescue Plan Rural Distribution; Noncompliance Finding/Material Weakness; Activities Allowed Compliance Requirement. Criteria: The Provider Relief Fund (PRF) was established under the Coronavirus, Aid, Relief, and Economic Security Act (Pub. L. No. 116-136, 134 Stat. 563) and the Coronavirus Relief and Response Supplemental Appropriations Act (Pub. L. No. 116-260). The PRFs are to be used to prevent, prepare for, and respond to coronavirus. The PRFs are to reimburse recipients only for health care related expenses or lost revenues that are attributable to coronavirus. The PRF funds may not be used to reimburse expenses or losses that have been reimbursed from other sources or that other sources are obligated to reimburse. Condition: The Hospital District did not meet the requirement that the PRF funds be used to reimburse expenses that have not been reimbursed by other sources or that other sources are obligated to reimburse. Cause: The Hospital District's summary spreadsheet for tracking federal grant expenditures contained information from multiple sources. When the expenditures were compiled into the summary spreadsheet used for reporting, procedures were not in place to prevent duplication. Effect: The Hospital District duplicated expenditures within the listing of PRF expenditures. Questioned Costs: Known questioned costs are $89,514. The Hospital District had unused lost revenues of $316,395 after reporting period 4 was completed. Therefore, after considering the effects of the known questioned costs identified, the Hospital District would still have unused lost revenues to carryforward to future reporting periods in the amount of $226,881. Perspective Information: The known questioned costs of $89,514 consisted of two separate components. The first component consisted of $87,350 of known questioned costs. Sampling was not necessary on this component as the entire amount was deemed to have been duplicated. The second component consisted of a sample of 10 expenses totaling $23,602 from a population of 80 expenses totaling $87,742. Each item tested in the second component contained a small amount of duplicated expenses. Total duplicated expenses identified were $2,164. The sample was not intended to be a statistically valid sample. Repeat Finding: N/A Recommendations: We recommend policies and procedures over federal grant reporting be strengthened to ensure expenditures are not already included in the federal grant expenses to avoid duplication of expenses. Views of Responsible Officials: The Hospital District agrees with this finding of noncompliance and materialweakness in internal control over compliance and will be implementing a plan of correction to include another individual independent of the reporting process to review the federal grant expenses prior to submission.