FAC Explorer

Audit 46933

FY End
2022-12-31
Total Expended
$16.31M
Findings
10
Programs
7
Organization: Winner Regional Healthcare Center (SD)
Year: 2022 Accepted: 2023-09-26
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
48209 2022-006 Material Weakness - N
48210 2022-007 Significant Deficiency - L
48211 2022-006 Material Weakness - N
48212 2022-007 Significant Deficiency - L
48213 2022-005 Material Weakness Yes L
624651 2022-006 Material Weakness - N
624652 2022-007 Significant Deficiency - L
624653 2022-006 Material Weakness - N
624654 2022-007 Significant Deficiency - L
624655 2022-005 Material Weakness Yes L

Programs

ALN Program Spent Major Findings
93.498 Provider Relief Fund $898,278 Yes 1
10.766 Community Facilities Loans and Grants $148,365 Yes 2
10.557 Wic Special Supplemental Nutrition Program for Women, Infants, and Children $37,256 - 0
93.301 Small Rural Hospital Improvement Grant Program $12,836 - 0
93.461 Covid-19 Testing for the Uninsured $10,377 - 0
93.800 Organized Approaches to Increase Colorectal Cancer Screening $3,099 - 0
93.994 Maternal and Child Health Services Block Grant to the States $2,145 - 0

Contacts

Name Title Type
PRPBMBN2Y1J3 Amanda Soesbe Auditee
6058427100 Joy Feige Auditor
No contacts on file

Notes to SEFA

Title: Community Facilities Loans and Grants Program Accounting Policies: Expenditures reported in the schedule are reported on the accrual basis of accounting, with the exception for the HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured program), which are recorded based on when the claim is deemed eligible as evidenced by the receipt of monies from the federal agency. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. Expenditures reporting in this schedule under the Community Facilities Loans and Grants Program consist of the beginning of the year outstanding balance for the direct loan plus advances during the year. There were no loan advances during the year ended December 31, 2022. The outstanding balance at December 31, 2022 was $14,874,482 for the direct USDA loan.Under the Community Facilities Grant Program, the Center was the subrecipient of a grant from the Winner Regional Health and Wellness Foundation, a related party, as well as receiving the required matching funds from donor contributions, for the purchase of a 3D mammography machine.
Title: Basis of Presentation Accounting Policies: Expenditures reported in the schedule are reported on the accrual basis of accounting, with the exception for the HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured program), which are recorded based on when the claim is deemed eligible as evidenced by the receipt of monies from the federal agency. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Winner Regional Healthcare Center (the Center) under programs of the federal government for the year ended December 31, 2022. The information is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Center.
Title: WIC Special Supplemental Nutrition Program for Women, Infants, and Children Accounting Policies: Expenditures reported in the schedule are reported on the accrual basis of accounting, with the exception for the HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured program), which are recorded based on when the claim is deemed eligible as evidenced by the receipt of monies from the federal agency. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. Federal reimbursements for the WIC Special Supplemental Nutrition Program for Women, Infants, and Children Federal Financial Assistance Listing #10.557 are not based upon specific expenditures. Therefore, the amounts reported in the schedule of expenditures of federal awards represent cash received rather than federal expenditures.
Title: Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Prog Accounting Policies: Expenditures reported in the schedule are reported on the accrual basis of accounting, with the exception for the HRSA COVID-19 Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured program), which are recorded based on when the claim is deemed eligible as evidenced by the receipt of monies from the federal agency. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Center does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The Center received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (PRF) program (Federal Financial Assistance Listing #93.498) in the amount of $5,633,704 as of December 31, 2021. The PRF expenditures are not recognized on the schedule until the expenditures are included in the reporting to HHS as required under the PRF Program. In accordance with the 2022 Compliance Supplement, the PRF expenditures recognized on the schedule are based on the reporting to HHS for Period 3, defined as payments received during January 1, 2021 to June 30, 2021 and Period 4, defined as payments received during July 1, 2021 to December 31, 2021 of $895,272, plus interest earned of $3,006 as required under the PRF program. The Center did not receive funding during Period 3.The following summarizes the Provider Relief funds and the timing of when the amounts were recognized in the financial statements.(see report for table)

Finding Details

Finding 2022-006
2022-006 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Material Weakness in Internal Control over Compliance Criteria: The Center must establish and maintain effective internal control over the reserve fund account that is maintained in accordance with the loan resolution. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specified account balance is reached. Condition: The Center elected to make a withdrawal and subsequent replenishment on the reserve account balance. There was no documented secondary review of the monthly reserve fund account reconciliations as compared to the required minimum balance. Cause: The Center did not have a formal review or approval process related to the transfer of funds to and from the operating account and reserve account or a process in place to compare the required balance per the Loan Resolution Security Agreement to the monthly reserve fund account balance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. The required reserve balance was appropriately funded as of December 31, 2022. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend that management implement procedures to include monitoring over special test and provisions related to federal expenditures including a secondary review of transfers to and from the reserve bank account and the monthly account reconciliation. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-007
2022-007 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Within the amended letter of conditions dated February 13, 2017, for the Community Facilities direct loan, annual audited financial statements are required to be submitted to the federal agency. Condition: The fiscal year 2021 audit report was required to be submitted to the federal agency by September 30th, 2022. The Center did not provide the 2021 audit report within the timeframe requested by the federal agency representative. Cause: The Center did not have an internal control process in place to ensure timely submission of the required reports to the federal agency. Effect: The required reports were not submitted by the requested date. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a process to ensure timely submission of the annual audit report. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-006
2022-006 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Material Weakness in Internal Control over Compliance Criteria: The Center must establish and maintain effective internal control over the reserve fund account that is maintained in accordance with the loan resolution. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specified account balance is reached. Condition: The Center elected to make a withdrawal and subsequent replenishment on the reserve account balance. There was no documented secondary review of the monthly reserve fund account reconciliations as compared to the required minimum balance. Cause: The Center did not have a formal review or approval process related to the transfer of funds to and from the operating account and reserve account or a process in place to compare the required balance per the Loan Resolution Security Agreement to the monthly reserve fund account balance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. The required reserve balance was appropriately funded as of December 31, 2022. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend that management implement procedures to include monitoring over special test and provisions related to federal expenditures including a secondary review of transfers to and from the reserve bank account and the monthly account reconciliation. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-007
2022-007 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Within the amended letter of conditions dated February 13, 2017, for the Community Facilities direct loan, annual audited financial statements are required to be submitted to the federal agency. Condition: The fiscal year 2021 audit report was required to be submitted to the federal agency by September 30th, 2022. The Center did not provide the 2021 audit report within the timeframe requested by the federal agency representative. Cause: The Center did not have an internal control process in place to ensure timely submission of the required reports to the federal agency. Effect: The required reports were not submitted by the requested date. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a process to ensure timely submission of the annual audit report. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-005
2022-005 Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 4 TIN #460274380 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Center selected option 1 to calculate lost revenue which consists of a comparison of 2019 actual results to 2020, 2021, and 2022 actual results by quarter. Patient care-related revenue should be reported net of adjustments for all third-party payers, charity care adjustments, bad debt, and any other discounts or adjustments, as applicable when reporting patient care-related revenue sources. Condition: The Center?s actual reported revenues for 2019 were incorrectly keyed into the HHS portal submission. Additionally, the revenues for 2022 were reported based upon actual revenue billed and reported within the Center?s electronic medical records (EMR) system which does not include monthly or quarterly adjustments posted to the general ledger. Cause: The Center?s internal control process in place did not ensure patient care revenue submitted to the Department of Health and Human Services for Period 4 agreed to the general ledger for 2022 or the supporting schedules prepared for 2019. The Center used the EMR system to calculate lost revenue due to the required input on the special report by payor type. Effect: The patient care related revenue reported within the special report submitted to the Department of Health and Human Services for 2019 was understated by $245,242 and for 2022 was overstated by $68,936. Lost revenue plus eligible expenses exceeded Period 1 and Period 4 funds received. Questioned Costs: There are no questioned costs related to the lost revenue calculation as the Center did not claim any lost revenue on the Period 4 special report. Context/Sampling: The total revenue for all applicable quarters was tested. Sampling was not used. Repeat Finding from Prior Years: Yes. Recommendation: We recommend the Center implement a secondary review process that reconciles the total revenue to the total revenue on the general ledger. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-006
2022-006 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Material Weakness in Internal Control over Compliance Criteria: The Center must establish and maintain effective internal control over the reserve fund account that is maintained in accordance with the loan resolution. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specified account balance is reached. Condition: The Center elected to make a withdrawal and subsequent replenishment on the reserve account balance. There was no documented secondary review of the monthly reserve fund account reconciliations as compared to the required minimum balance. Cause: The Center did not have a formal review or approval process related to the transfer of funds to and from the operating account and reserve account or a process in place to compare the required balance per the Loan Resolution Security Agreement to the monthly reserve fund account balance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. The required reserve balance was appropriately funded as of December 31, 2022. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend that management implement procedures to include monitoring over special test and provisions related to federal expenditures including a secondary review of transfers to and from the reserve bank account and the monthly account reconciliation. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-007
2022-007 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Within the amended letter of conditions dated February 13, 2017, for the Community Facilities direct loan, annual audited financial statements are required to be submitted to the federal agency. Condition: The fiscal year 2021 audit report was required to be submitted to the federal agency by September 30th, 2022. The Center did not provide the 2021 audit report within the timeframe requested by the federal agency representative. Cause: The Center did not have an internal control process in place to ensure timely submission of the required reports to the federal agency. Effect: The required reports were not submitted by the requested date. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a process to ensure timely submission of the annual audit report. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-006
2022-006 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Special Tests and Provisions Material Weakness in Internal Control over Compliance Criteria: The Center must establish and maintain effective internal control over the reserve fund account that is maintained in accordance with the loan resolution. The Loan Resolution Security Agreement requires a monthly amount to be set aside in a reserve fund until the specified account balance is reached. Condition: The Center elected to make a withdrawal and subsequent replenishment on the reserve account balance. There was no documented secondary review of the monthly reserve fund account reconciliations as compared to the required minimum balance. Cause: The Center did not have a formal review or approval process related to the transfer of funds to and from the operating account and reserve account or a process in place to compare the required balance per the Loan Resolution Security Agreement to the monthly reserve fund account balance. Effect: The lack of formal review or approval increases the risk of employees participating in the federal award administration not detecting and correcting noncompliance in a timely manner. Questioned Costs: None reported. The required reserve balance was appropriately funded as of December 31, 2022. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend that management implement procedures to include monitoring over special test and provisions related to federal expenditures including a secondary review of transfers to and from the reserve bank account and the monthly account reconciliation. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-007
2022-007 Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Within the amended letter of conditions dated February 13, 2017, for the Community Facilities direct loan, annual audited financial statements are required to be submitted to the federal agency. Condition: The fiscal year 2021 audit report was required to be submitted to the federal agency by September 30th, 2022. The Center did not provide the 2021 audit report within the timeframe requested by the federal agency representative. Cause: The Center did not have an internal control process in place to ensure timely submission of the required reports to the federal agency. Effect: The required reports were not submitted by the requested date. Questioned Costs: None reported. Context/Sampling: Sampling was not used. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a process to ensure timely submission of the annual audit report. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-005
2022-005 Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 4 TIN #460274380 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Center selected option 1 to calculate lost revenue which consists of a comparison of 2019 actual results to 2020, 2021, and 2022 actual results by quarter. Patient care-related revenue should be reported net of adjustments for all third-party payers, charity care adjustments, bad debt, and any other discounts or adjustments, as applicable when reporting patient care-related revenue sources. Condition: The Center?s actual reported revenues for 2019 were incorrectly keyed into the HHS portal submission. Additionally, the revenues for 2022 were reported based upon actual revenue billed and reported within the Center?s electronic medical records (EMR) system which does not include monthly or quarterly adjustments posted to the general ledger. Cause: The Center?s internal control process in place did not ensure patient care revenue submitted to the Department of Health and Human Services for Period 4 agreed to the general ledger for 2022 or the supporting schedules prepared for 2019. The Center used the EMR system to calculate lost revenue due to the required input on the special report by payor type. Effect: The patient care related revenue reported within the special report submitted to the Department of Health and Human Services for 2019 was understated by $245,242 and for 2022 was overstated by $68,936. Lost revenue plus eligible expenses exceeded Period 1 and Period 4 funds received. Questioned Costs: There are no questioned costs related to the lost revenue calculation as the Center did not claim any lost revenue on the Period 4 special report. Context/Sampling: The total revenue for all applicable quarters was tested. Sampling was not used. Repeat Finding from Prior Years: Yes. Recommendation: We recommend the Center implement a secondary review process that reconciles the total revenue to the total revenue on the general ledger. Views of Responsible Officials: Management agrees with the finding.