Reporting – SEFA Preparation Information of the federal program: Federal Grantor: U.S. Department of Health and Human Services Federal Cluster: None Assistance Listing No.: 93.918, Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease (Ryan White, Part C) Federal Award Numbers: H76HA31655, H76HA25775, H76HA00617, and P06HA9851 Federal Award Period: April 1, 2022 through March 31, 2025; May 1, 2022 through April 30, 2025; May 1, 2022 through April 30, 2025; and September 1, 2023 through August 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): The Uniform Guidance 2 CFR section 200.510 states, “(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of federal awards (the SEFA) for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended.” Condition: Ryan White, Part C requires the use of program income under the additive method, which requires program income earned from a federally funded program is added to the federal award amount and used to further program objectives. Under the method, allowable expenditures of program income are included on the SEFA. UPMC’s SEFA did not include expenditures related to program income, which were allowable. Cause: UPMC’s SEFA included grant funds expended under the Ryan White, Part C program but did not include program income funds expended under the Ryan White, Part C program for the year ended December 31, 2024. Effect or potential effect: The expenditures in the SEFA for the Ryan White, Part C a program for the year ended December 31, 2024, were understated which resulted in the improper identification of major federal programs and, therefore, required the restatement of the previously issued Uniform Guidance report to include Ryan White, Part C as a major federal program. Questioned costs: None. Context: Expenditures for Ryan White, Part C were understated by $5,539,365 (as compared to total restated expenditures for Ryan White, Part C of $7,048,401), which resulted in Ryan White, Part C being identified as major federal program upon inclusion of the allowable expenditures from program income. Identification as a repeat finding, if applicable: Yes, this is a repeat of finding 2023-002 from the prior year. Recommendation: UPMC should evaluate its internal controls over the SEFA process to ensure that reported federal expenditures include both grant expenditures and applicable program income expenditures, when required, to support the accurate reporting of federal expenditures. Views of responsible officials: Management concurs with this finding.
Ryan White Program Review and Approval Internal Controls Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services Federal Cluster: None Assistance Listing No.: 93.918, Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease (Ryan White, Part C) Federal Award Numbers: H76HA31655, H76HA25775, H76HA00617, and P06HA9851 Federal Award Period: April 1, 2022 through March 31, 2025; May 1, 2022 through April 30, 2025; May 1, 2022 through April 30, 2025; and September 1, 2023 through August 31, 2024 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Section 200.303 of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) states the following regarding internal control: “The non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award 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” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: For the period under audit, UPMC did not retain sufficient evidence to support the design and operation of internal controls over the following compliance requirements: • Allowability • Cash Management • Matching, Level of Effort, Earmarking • Program Income • Reporting Cause: The design and operation of UPMC’s controls over the program did not incorporate appropriate procedures to document and maintain evidence to support the operation of such controls. Revisions to the design and operation of UPMC’s controls were made subsequent to year-end, thus leading to no evidence of controls during the year under audit. Effect or Potential Effect: If appropriate controls are not documented and functioning properly, program data used to determine allowability and program income and compile required reports may not be complete and accurate resulting in noncompliance with the applicable compliance requirements or questioned costs. Questioned Costs: None Context: Total federal expenditures on the SEFA for Ryan White, Part C totaled $7,048,401 for the year ended December 31, 2024. Identification as a Repeat Finding, if Applicable: Yes, this is a repeat of 2023-003 of the prior year. Recommendation: UPMC should ensure all control policies related to the applicable compliance processes are implemented and that evidence of each control is maintained for Ryan White, Part C. Views of Responsible Officials: Management concurs with this finding. Subsequent to December 31, 2024, management revised the internal control policies and procedures for Ryan White, Part C to appropriately maintain evidence of controls performed