Audit 403116

Information on Federal Programs: 93.083 – Centers for Disease Control and Prevention: Prevention of Disease, Disability, and Death through Immunization & Control of Respiratory & Related Diseases. Criteria or Specific Requirements: 2 CFR §200.510(b) requires recipients of Federal funds to prepare a SEFA for the period covered by the auditee’s financial statements that includes Federal awards expended during that fiscal year. 2 CFR §500.502 provides that the determination of when a Federal award is expended must be based on when the activity related to the Federal award occurs. Condition: During testing of the SEFA for the year ended December 31, 2024, we noted that certain Federal program expenditures related to activities incurred in fiscal year 2023 were reported in the 2024 SEFA instead of in the 2023 SEFA. Cause: Management’s procedures for preparing and reviewing the SEFA did not include sufficient controls to ensure that expenditures are reported in the correct fiscal year. Effect: The SEFA for the year ended December 31, 2023 was incomplete, and the SEFA for the year ended December 31, 2024 includes expenditures that related to activities incurred in fiscal year 2023. Although the expenditures were allowable costs of the Federal program, the timing misstatement affects the accuracy of SEFA presentation and could affect the usefulness of SEFA information to Federal agencies and pass-through entities in their monitoring and oversight. The error did not impact the major program selection process for 2023 or 2024.Perspective: This issue was identified during our testing of the SEFA for the year ended December 31, 2024, when we noted that ATS reported $114,984 of Federal award expenditures in 2024 that related to activities incurred in fiscal year 2023. These expenditures should have been reported in the SEFA for year ended December 31, 2023. Questioned Costs: None. Identification as a Repeat Finding: Not applicable. Recommendation: ATS should implement formal procedures for compiling the SEFA, including (1) reconciling SEFA amounts to the general ledger and other supporting records, (2) performing a year-end review to confirm that expenditures are reported in the correct fiscal year in accordance with 2 CFR §200.502 and 2 CFR §200.510(b), and (3) documenting supervisory review of the SEFA prior to finalization.

Information on Federal Programs: 93.083 – Centers for Disease Control and Prevention: Prevention of Disease, Disability, and Death through Immunization & Control of Respiratory & Related Diseases. Criteria or Specific Requirements: 2 CFR §200.303 requires the non-Federal entity to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the award is managed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in Standards for Internal Control in the Federal Government (Green Book), issued by the Comptroller General of the United States, or the COSO Internal Control Integrated Framework. 2 CFR §200.318-200.320 require the non-Federal entity to have and use documented procurement procedures for the acquisition of property or services under a Federal award that are consistent with the standards for general procurement, competition, and methods of procurement. Condition: ATS’s organization-wide procurement policy does not include documented procurement procedures that address the Uniform Guidance requirements for procurement under Federal awards (for example, methods of procurement, competition requirements, and applicable thresholds) as required by 2 CFR §200.318-200.320. For the federally funded program, ATS implemented a separate written selection policy for contractors/health systems; however, this policy does not fully address all Uniform Guidance procurement elements. Cause: Management had not fully updated its written procurement policies and procedures to incorporate the specific requirements of 2 CFR §200.318-200.320 for procurements under Federal awards. As a result, internal control procedures over procurement under the Federal program were not fully documented in a manner consistent with the Uniform Guidance. Effect: Failure to have and use fully documented procurement policies and procedures compliant with the Uniform Guidance could result in noncompliance with Federal procurement requirements and increase the risk of unallowable or improperly procured costs under Federal awards. In the current year, our testing did not identify specific instances in which procurement transactions under the Federal program were noncompliant; however, the lack of fully compliant written procedures represents a significant deficiency in internal control over compliance. Perspective: ATS did not have documented procurement policies and procedures that were fully compliant with 2 CFR §200.320 for procurement under Federal awards. However, for the Federal program, ATS established a documented selection criteria policy for contractors/health systems. Under this policy, a selection subcommittee reviews, evaluates, and selects health systems based on defined criteria, and each selected application is submitted to the prime awardee for review and approval before ATS issues contracts. In a random sample of 8 procurement contracts tested, all 8 followed the documented selection process and were supported by appropriate documentation. Questioned Costs: None. Identification as a Repeat Finding: Continued Finding 2023-005. Recommendation: ATS should update and formalize its procurement policies and procedures to incorporate the requirements of 2 CFR §200.318-200.320 for all procurements under Federal awards, including: methods of procurement and thresholds, competition requirements, documentation of procurement history, and oversight responsibilities. Once updated, ATS should ensure the procurement under the Federal program is carried out in accordance with these policies and that staff are trained on the revised requirements.

Information on Federal Programs: 93.083 – Centers for Disease Control and Prevention: Prevention of Disease, Disability, and Death through Immunization & Control of Respiratory & Related Diseases. Criteria or Specific Requirements: 2 CFR §200.512(a) requires the auditee to submit the data collection form and reporting package to the Federal Audit Clearinghouse by the earlier of 30 calendar days after receipt of the auditors’ report, or nine months after the end of the audit period. Condition: For the year ended December 31, 2023, ATS’s single audit reporting package was required to be submitted to the Federal Audit Clearinghouse by September 30, 2024 (nine months after year end). The auditors’ reports were issued on May 30, 2025, and the data collection form and reporting package were submitted on June 27, 2025. As a result, the submission did not meet the Uniform Guidance due date requirement. Cause: Fieldwork timelines for the 2023 audit were extended due to deficiencies in month end and year end closing, revenue recognition, and expense recognition and cut-off internal control processes, as outlined in findings 2023-001, 2023-002 and 2023-003. These delays in completing the financial statement audit and single audit contributed to the late issuance of the auditors’ reports and the late submission of the single audit reporting package. Effect: Late submission of the single audit reporting package represents noncompliance with the reporting requirements of 2 CFR §200.512(a). This noncompliance may result in ATS being considered a higher-risk auditee by Federal agencies and pass-through entities, and may negatively affect eligibility for future Federal funding. Perspective: Due to delays in completing the 2023 audit, ATS did not submit the single audit reporting package for the year ended December 31, 2023, to the Federal Audit Clearinghouse by the required due date. Questioned Costs: None. Identification as a Repeat Finding: Not applicable. Recommendation: ATS should implement and monitor procedures to ensure that future audits are completed in sufficient time to allow submission of the data collection form and single audit reporting package to the Federal Audit Clearinghouse by the earlier of 30 days after the date of the auditors’ reports or nine months after the end of the fiscal year, in accordance with 2 CFR §200.512(a). This should include strengthening the underlying financial reporting and closing processes noted in related findings so that they do not delay audit completion.