Audit 411472

2026-002 Allowable Costs/Cost Principles (repeat of finding 2025-002) Program Information Federal Organization U.S Department of Health and Human Services Assistance Listing Numbers 93.224 Health Center Program Cluster Award Numbers H80CS00513 Criteria [X] Compliance Finding [ ] Significant Deficiency [X] Material Weakness Title 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart E sets for the specific cost principles to be followed when expending federal funds. Condition The Organization claimed an expenditure for reimbursement that was not consistent with the cost principles requirements of Subpart E. This finding appears to be an isolated incident. Cause The Organization’s internal controls did not include proper review of transactions charged to federal programs to ensure that the goods or services received were allowable costs that conform to the cost principles in Subpart E. Effect The Organization may allocate unallowable costs to the federal awards. Questioned Costs $5,500 Context In a sample of 40 transactions tested, one was found to be for expenditures that were not consistent with the allowable cost principles. Recommendation Management should establish controls to identify and prevent duplicate expense postings. These controls will help ensure that expenses recorded in the general ledger accurately reflect actual expenditures, are supported by underlying documentation, and do not include duplicate amounts carried forward from prior invoices. Views of responsible officials and planned corrective action Management is in agreement with this finding and will take corrective action as outlined on page 33.

2026-003 Period of Performance (repeat of finding 2025-003) Program Information Federal Organization U.S Department of Health and Human Services Assistance Listing Numbers 93.224 Health Center Program Cluster Award Numbers H80CS00513 Criteria [X] Compliance Finding [] Significant Deficiency [X] Material Weakness Title 2 CFR 200.403(h) requires that costs be incurred in the approved budget period for the applicable awards and Title 2 CFR 200.403(e) requires that those costs be determined according to GAAP. Condition The Organization’s federal expenditures include costs for goods and/or services outside of the approved budget periods for the awards. Cause The Organization’s internal controls over compliance did not include consideration of when the goods were received or services were performed compared to the budget periods for the awards. Lack of understanding of GAAP and the requirements of accrual basis accounting allowed expenditures outside of the applicable budget periods to be claimed as current federal expenditures. Effect The Organization may allocate costs outside of the grant period to the federal awards. Questioned Costs $4,139 Context In a sample of 40 transactions tested, we noted three transactions, totaling $4,139, that were for goods or services provided outside of the budget period for the award. Recommendation We recommend management personnel authorized to approve expenditures of federal awards be limited to those who have a basic understanding of GAAP and the relationship between the accrual basis of accounting and the period of performance requirements. Views of responsible officials and planned corrective action Management is in agreement with this finding and will take corrective action as outlined on page 33.

2026-004 Procurement Program Information Federal Organization U.S Department of Health and Human Services Assistance Listing Numbers 93.224 Health Center Program Cluster Award Numbers H80CS00513 Criteria [X] Compliance Finding [] Significant Deficiency [X] Material Weakness Title 2 CFR 200.318 requires that entities receiving federal awards must have and use their documented procurement policies and these policies must be consistent with state and local laws and regulations and the standards identified in §200.317 through 200.327. Condition The Organization did not follow its documented procurement policy. Cause Management did not follow its established procurement policy, and documentation was not maintained evidencing its compliance with the policy, such as obtaining competitive bids and documenting sole-source vendor justifications. Effect The Organization may overpay for goods and services due to selecting vendors without appropriate consideration of the competitive bids and cost analysis. Questioned Costs $39,478 Context In a sample of 40 invoices, we noted six with issues related to the procurement process. Organization did not follow their established procurement policy and did not retain appropriate documentation of competitive bids. Recommendation We recommend that the Organization maintain adequate documentation supporting reports submitted to awarding agencies and update its procurement policy to align with 2 CFR 200.320(c). Views of responsible officials and planned corrective action Management is in agreement with this finding and will take corrective action as outlined on page 34.

2026-005 Special Tests and Provisions Program Information Federal Organization U.S Department of Health and Human Services Assistance Listing Numbers 93.224 Health Center Program Cluster Award Numbers H80CS00513 Criteria [X] Compliance Finding [X] Significant Deficiency [ ] Material Weakness Special Tests and Provisions requires compliance with the program-specific sliding fee discount requirements. The underlying Health Center Program criteria are Section 330(k)(3)(G) of the Public Health Service Act; 42 U.S.C. § 254b(k)(3)(G); and 42 CFR § 51c.303(f), (g), and (u). This finding appears to be an isolated problem. Condition For one item, the patient’s income and family size placed the patient in discount tier B, but the incorrect discount category was applied. Cause The Organization did not have adequate controls to ensure sliding fee discounts were accurately applied. Specifically, staff did not consistently select the correct discount tier, and management did not timely review discounted accounts to confirm patient charges agreed to the approved sliding fee discount schedule. Effect Failure to properly calculate and apply sliding fee discounts may result in patient charges that do not align with federal requirements or the approved sliding fee schedule, potentially leading to incorrect patient responsibility amounts. Context In a sample of 40 patient encounters selected with sliding fee discount, we noted one selection who had the incorrect sliding fee applied. Recommendation We recommend that management strengthen controls over the sliding fee process by requiring supervisory review of income documentation, family size, and discount-level determinations before billing; periodically reconciling billed amounts to the approved sliding fee schedule; documenting reassessments at required intervals; and training billing and intake personnel on the current sliding fee requirements. Views of responsible officials and planned corrective action Management is in agreement with this finding and will take corrective action as outlined on page 35.