Finding 2022-001: Internal control deficiency and noncompliance over amounts reported in the Schedule of Expenditures of Federal Awards (SEFA). Identification of the federal program: Assistance Listing Number 93.498: ? COVID-19 ? Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution ? U.S. Department of Health and Human Services ? Federal award identification number ? Not Applicable ? Federal award year ? Period 2: January 1, 2020 to December 31, 2021 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls, states: ?The non-Federal entity must: (a) 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).? In addition, the Office of Management and Budget Compliance Supplement states: ?SEFA reporting amounts for this program (including both expenditures and lost revenues) are based upon the PRF report that is required to be submitted to the HRSA reporting portal. For a FYE of June 30, 2022 and through FYEs of December 30, 2022, recipients should report in the SEFA, the expenditures and lost revenues for the Period 2 (payments received from July 1, 2020 to December 31, 2020) PRF report.? Condition: During our testing over the SEFA, we observed management did not have effective internal controls in place to ensure accurate reporting of the payments received in the SEFA. This resulted in an overstatement of the amount reported in the SEFA. Cause: Management did not have effective internal controls in place to ensure accurate reporting of the payments received in the SEFA. Effect or potential effect: The payments received were incorrectly reported in the SEFA. Questioned costs: None. Context: During our testing over the SEFA, we obtained the PRF report submitted to the Portal and reconciled the total payments received to the SEFA. We observed the payments received totaled $12,100,000, which represents the expenditures and lost revenues for the Period 2 (payments received from July 1, 2020 to December 31, 2020), as compared to the initial amount reported in the SEFA of $12,566,247. This resulted in an overstatement of the amount reported in the SEFA of $466,247. Management?s internal control over the review of the SEFA did not identify this overstatement. The amount reported in the SEFA was subsequently corrected and the corrected amount is reflected in the data collection form. Identification as a repeat finding, if applicable: Yes ? Finding 2021-002. Recommendation: Management should develop and implement internal controls to ensure the completeness and accuracy of the SEFA, including a review of applicable guidance in preparing the SEFA. Views of responsible officials: An additional review process of the SEFA will be implemented to be performed by both the Vice President of Financial Services and the Chief Financial Officer to ensure the SEFA contains complete and accurate reporting of expenditures, and to ensure that applicable guidance is reviewed prior to its finalization.
Finding 2022-002: Internal control deficiency and noncompliance over program income requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?the non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.305(b)(5) Federal payment states: ?To the extent available, the non-Federal entity must disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.328 Financial reporting states: ?Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as appliable, when providing financial and performance reporting information.? The Ryan White HIV/AIDS Program and Program Income Policy Clarification Notice #15-03 states the following: ? Under the uniform administrative requirements, to the extent available, recipients and subrecipients must disburse funds available from program income, rebates, refunds, contract settlements, audit recoveries and interest earned on such funds before requesting additional cash payments. ? Recipients are required to track and account for all program income in accordance with 45 CFR 75.302(b)(3). Recipients must report program income on their Federal Financial Report (FFRs). ? Documentation of program income and accounting for its receipt and utilization will be consistent across Parts, to the extent possible. o Parts C, D, and F are discretionary awards and have multi-year periods of performance: ? Parts C, D, and F recipients must account for program income and its use within their multi-year period of performance. ? In the final year of funding, program income received at the end of the period of performance will be expended prior to new grant funds awarded in the next competitive cycle, so long as the recipient receives such subsequent award. Condition: During our review over program income, we observed management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Cause: Management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Effect or potential effect: We were unable to test program income compliance or internal controls. Questioned costs: Unknown. Context: During our review over program income, we obtained the annual financial report submitted. We observed the total federal share of program income earned incorrectly reported Ryan White HIV/AIDS Program Part A, B, C and cash receipts unrelated to the program. The reported balance was also reported based on a cash basis instead of the accrual method stated on the federal financial report. We were unable to test the amount reported on the federal financial report as the amount reported is a cumulative amount from January 1, 2018 onward and included cash receipts unrelated to the program. During our review over program income, we observed management did not track program income earned as compared to the actual expenditures incurred. We were unable to test that program income was disbursed prior to requesting additional cash payments. Identification as a repeat finding, if applicable: Yes ? Finding 2021-004. Recommendation: We recommend that management develop and implement internal controls to ensure accurate reporting in the federal financial report and tracking of program income earned as compared to the actual expenditures incurred. This will ensure program income is reported and tracked accurately. Views of responsible officials: The Ryan White Part C program project period ended December 31, 2021 and a new project period started January 1, 2022 with the first federal financial report due in April 2023. Starting with the new program year, Valleywise Health management will develop and implement internal controls to ensure that program income is accurately calculated and reported in the federal financial report.
Finding 2022-003: Internal control deficiency and noncompliance over small purchase procurement requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?The non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.318(i) General procurement standards state: ?The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.320(a)(2)(i) Small purchase procedures state: ?The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity.? Condition: During our testing over small purchase procurements, we observed management did not have effective internal controls in place to ensure that price or rate quotations were obtained from an adequate number of qualified sources at the time of procurement. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: Small purchase procurements were not supported by effective internal controls and could potentially include unreasonable prices or rates. Questioned costs: None. Context: We tested the entire population of small purchase procurements, which consisted of two purchases totaling $25,353. Price or rate quotations were not obtained from an adequate number of qualified sources at the time of procurement for the two purchases. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that management develop and implement internal controls to support the performance and documentation of small purchase procurement transactions. Views of responsible officials: Valleywise Health management will develop and implement additional layer of review regarding vendor selection and pricing quote for supplies and services to ensure compliance with federal guidelines on expenditures.
Finding 2022-002: Internal control deficiency and noncompliance over program income requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?the non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.305(b)(5) Federal payment states: ?To the extent available, the non-Federal entity must disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.328 Financial reporting states: ?Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as appliable, when providing financial and performance reporting information.? The Ryan White HIV/AIDS Program and Program Income Policy Clarification Notice #15-03 states the following: ? Under the uniform administrative requirements, to the extent available, recipients and subrecipients must disburse funds available from program income, rebates, refunds, contract settlements, audit recoveries and interest earned on such funds before requesting additional cash payments. ? Recipients are required to track and account for all program income in accordance with 45 CFR 75.302(b)(3). Recipients must report program income on their Federal Financial Report (FFRs). ? Documentation of program income and accounting for its receipt and utilization will be consistent across Parts, to the extent possible. o Parts C, D, and F are discretionary awards and have multi-year periods of performance: ? Parts C, D, and F recipients must account for program income and its use within their multi-year period of performance. ? In the final year of funding, program income received at the end of the period of performance will be expended prior to new grant funds awarded in the next competitive cycle, so long as the recipient receives such subsequent award. Condition: During our review over program income, we observed management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Cause: Management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Effect or potential effect: We were unable to test program income compliance or internal controls. Questioned costs: Unknown. Context: During our review over program income, we obtained the annual financial report submitted. We observed the total federal share of program income earned incorrectly reported Ryan White HIV/AIDS Program Part A, B, C and cash receipts unrelated to the program. The reported balance was also reported based on a cash basis instead of the accrual method stated on the federal financial report. We were unable to test the amount reported on the federal financial report as the amount reported is a cumulative amount from January 1, 2018 onward and included cash receipts unrelated to the program. During our review over program income, we observed management did not track program income earned as compared to the actual expenditures incurred. We were unable to test that program income was disbursed prior to requesting additional cash payments. Identification as a repeat finding, if applicable: Yes ? Finding 2021-004. Recommendation: We recommend that management develop and implement internal controls to ensure accurate reporting in the federal financial report and tracking of program income earned as compared to the actual expenditures incurred. This will ensure program income is reported and tracked accurately. Views of responsible officials: The Ryan White Part C program project period ended December 31, 2021 and a new project period started January 1, 2022 with the first federal financial report due in April 2023. Starting with the new program year, Valleywise Health management will develop and implement internal controls to ensure that program income is accurately calculated and reported in the federal financial report.
Finding 2022-003: Internal control deficiency and noncompliance over small purchase procurement requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?The non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.318(i) General procurement standards state: ?The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.320(a)(2)(i) Small purchase procedures state: ?The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity.? Condition: During our testing over small purchase procurements, we observed management did not have effective internal controls in place to ensure that price or rate quotations were obtained from an adequate number of qualified sources at the time of procurement. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: Small purchase procurements were not supported by effective internal controls and could potentially include unreasonable prices or rates. Questioned costs: None. Context: We tested the entire population of small purchase procurements, which consisted of two purchases totaling $25,353. Price or rate quotations were not obtained from an adequate number of qualified sources at the time of procurement for the two purchases. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that management develop and implement internal controls to support the performance and documentation of small purchase procurement transactions. Views of responsible officials: Valleywise Health management will develop and implement additional layer of review regarding vendor selection and pricing quote for supplies and services to ensure compliance with federal guidelines on expenditures.
Finding 2022-001: Internal control deficiency and noncompliance over amounts reported in the Schedule of Expenditures of Federal Awards (SEFA). Identification of the federal program: Assistance Listing Number 93.498: ? COVID-19 ? Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution ? U.S. Department of Health and Human Services ? Federal award identification number ? Not Applicable ? Federal award year ? Period 2: January 1, 2020 to December 31, 2021 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls, states: ?The non-Federal entity must: (a) 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).? In addition, the Office of Management and Budget Compliance Supplement states: ?SEFA reporting amounts for this program (including both expenditures and lost revenues) are based upon the PRF report that is required to be submitted to the HRSA reporting portal. For a FYE of June 30, 2022 and through FYEs of December 30, 2022, recipients should report in the SEFA, the expenditures and lost revenues for the Period 2 (payments received from July 1, 2020 to December 31, 2020) PRF report.? Condition: During our testing over the SEFA, we observed management did not have effective internal controls in place to ensure accurate reporting of the payments received in the SEFA. This resulted in an overstatement of the amount reported in the SEFA. Cause: Management did not have effective internal controls in place to ensure accurate reporting of the payments received in the SEFA. Effect or potential effect: The payments received were incorrectly reported in the SEFA. Questioned costs: None. Context: During our testing over the SEFA, we obtained the PRF report submitted to the Portal and reconciled the total payments received to the SEFA. We observed the payments received totaled $12,100,000, which represents the expenditures and lost revenues for the Period 2 (payments received from July 1, 2020 to December 31, 2020), as compared to the initial amount reported in the SEFA of $12,566,247. This resulted in an overstatement of the amount reported in the SEFA of $466,247. Management?s internal control over the review of the SEFA did not identify this overstatement. The amount reported in the SEFA was subsequently corrected and the corrected amount is reflected in the data collection form. Identification as a repeat finding, if applicable: Yes ? Finding 2021-002. Recommendation: Management should develop and implement internal controls to ensure the completeness and accuracy of the SEFA, including a review of applicable guidance in preparing the SEFA. Views of responsible officials: An additional review process of the SEFA will be implemented to be performed by both the Vice President of Financial Services and the Chief Financial Officer to ensure the SEFA contains complete and accurate reporting of expenditures, and to ensure that applicable guidance is reviewed prior to its finalization.
Finding 2022-002: Internal control deficiency and noncompliance over program income requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?the non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.305(b)(5) Federal payment states: ?To the extent available, the non-Federal entity must disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.328 Financial reporting states: ?Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as appliable, when providing financial and performance reporting information.? The Ryan White HIV/AIDS Program and Program Income Policy Clarification Notice #15-03 states the following: ? Under the uniform administrative requirements, to the extent available, recipients and subrecipients must disburse funds available from program income, rebates, refunds, contract settlements, audit recoveries and interest earned on such funds before requesting additional cash payments. ? Recipients are required to track and account for all program income in accordance with 45 CFR 75.302(b)(3). Recipients must report program income on their Federal Financial Report (FFRs). ? Documentation of program income and accounting for its receipt and utilization will be consistent across Parts, to the extent possible. o Parts C, D, and F are discretionary awards and have multi-year periods of performance: ? Parts C, D, and F recipients must account for program income and its use within their multi-year period of performance. ? In the final year of funding, program income received at the end of the period of performance will be expended prior to new grant funds awarded in the next competitive cycle, so long as the recipient receives such subsequent award. Condition: During our review over program income, we observed management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Cause: Management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Effect or potential effect: We were unable to test program income compliance or internal controls. Questioned costs: Unknown. Context: During our review over program income, we obtained the annual financial report submitted. We observed the total federal share of program income earned incorrectly reported Ryan White HIV/AIDS Program Part A, B, C and cash receipts unrelated to the program. The reported balance was also reported based on a cash basis instead of the accrual method stated on the federal financial report. We were unable to test the amount reported on the federal financial report as the amount reported is a cumulative amount from January 1, 2018 onward and included cash receipts unrelated to the program. During our review over program income, we observed management did not track program income earned as compared to the actual expenditures incurred. We were unable to test that program income was disbursed prior to requesting additional cash payments. Identification as a repeat finding, if applicable: Yes ? Finding 2021-004. Recommendation: We recommend that management develop and implement internal controls to ensure accurate reporting in the federal financial report and tracking of program income earned as compared to the actual expenditures incurred. This will ensure program income is reported and tracked accurately. Views of responsible officials: The Ryan White Part C program project period ended December 31, 2021 and a new project period started January 1, 2022 with the first federal financial report due in April 2023. Starting with the new program year, Valleywise Health management will develop and implement internal controls to ensure that program income is accurately calculated and reported in the federal financial report.
Finding 2022-003: Internal control deficiency and noncompliance over small purchase procurement requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?The non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.318(i) General procurement standards state: ?The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.320(a)(2)(i) Small purchase procedures state: ?The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity.? Condition: During our testing over small purchase procurements, we observed management did not have effective internal controls in place to ensure that price or rate quotations were obtained from an adequate number of qualified sources at the time of procurement. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: Small purchase procurements were not supported by effective internal controls and could potentially include unreasonable prices or rates. Questioned costs: None. Context: We tested the entire population of small purchase procurements, which consisted of two purchases totaling $25,353. Price or rate quotations were not obtained from an adequate number of qualified sources at the time of procurement for the two purchases. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that management develop and implement internal controls to support the performance and documentation of small purchase procurement transactions. Views of responsible officials: Valleywise Health management will develop and implement additional layer of review regarding vendor selection and pricing quote for supplies and services to ensure compliance with federal guidelines on expenditures.
Finding 2022-002: Internal control deficiency and noncompliance over program income requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?the non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.305(b)(5) Federal payment states: ?To the extent available, the non-Federal entity must disburse funds available from program income (including repayments to a revolving fund), rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting additional cash payments.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.328 Financial reporting states: ?Unless otherwise approved by OMB, the Federal awarding agency must solicit only the OMB approved governmentwide data elements for collection of financial information (at time of publication the Federal Financial Report or such future, OMB-approved, governmentwide data elements available from the OMB-designated standards lead. This information must be collected with the frequency required by the terms and conditions of the Federal award, but no less frequently than annually nor more frequently than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes, and preferably in coordination with performance reporting. The Federal awarding agency must use OMB-approved common information collections, as appliable, when providing financial and performance reporting information.? The Ryan White HIV/AIDS Program and Program Income Policy Clarification Notice #15-03 states the following: ? Under the uniform administrative requirements, to the extent available, recipients and subrecipients must disburse funds available from program income, rebates, refunds, contract settlements, audit recoveries and interest earned on such funds before requesting additional cash payments. ? Recipients are required to track and account for all program income in accordance with 45 CFR 75.302(b)(3). Recipients must report program income on their Federal Financial Report (FFRs). ? Documentation of program income and accounting for its receipt and utilization will be consistent across Parts, to the extent possible. o Parts C, D, and F are discretionary awards and have multi-year periods of performance: ? Parts C, D, and F recipients must account for program income and its use within their multi-year period of performance. ? In the final year of funding, program income received at the end of the period of performance will be expended prior to new grant funds awarded in the next competitive cycle, so long as the recipient receives such subsequent award. Condition: During our review over program income, we observed management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Cause: Management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above and was unable to provide sufficient documentation to support the program income earned by the program. Effect or potential effect: We were unable to test program income compliance or internal controls. Questioned costs: Unknown. Context: During our review over program income, we obtained the annual financial report submitted. We observed the total federal share of program income earned incorrectly reported Ryan White HIV/AIDS Program Part A, B, C and cash receipts unrelated to the program. The reported balance was also reported based on a cash basis instead of the accrual method stated on the federal financial report. We were unable to test the amount reported on the federal financial report as the amount reported is a cumulative amount from January 1, 2018 onward and included cash receipts unrelated to the program. During our review over program income, we observed management did not track program income earned as compared to the actual expenditures incurred. We were unable to test that program income was disbursed prior to requesting additional cash payments. Identification as a repeat finding, if applicable: Yes ? Finding 2021-004. Recommendation: We recommend that management develop and implement internal controls to ensure accurate reporting in the federal financial report and tracking of program income earned as compared to the actual expenditures incurred. This will ensure program income is reported and tracked accurately. Views of responsible officials: The Ryan White Part C program project period ended December 31, 2021 and a new project period started January 1, 2022 with the first federal financial report due in April 2023. Starting with the new program year, Valleywise Health management will develop and implement internal controls to ensure that program income is accurately calculated and reported in the federal financial report.
Finding 2022-003: Internal control deficiency and noncompliance over small purchase procurement requirements. Identification of the federal program: Assistance Listing Number 93.918: ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? COVID-19 ? Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease ? U.S. Department of Health and Human Services ? Federal award identification numbers and award years: o 5 H76HA00151-31-00 ? January 1, 2018 to December 31, 2021 o 6 H76HA00151-31-01 ? January 1, 2018 to December 31, 2021 o 2 H76HA00151-32-00 ? January 1, 2022 to December 31, 2024 o 6 H76HA00151-32-01 ? January 1, 2022 to December 31, 2024 Criteria or specific requirement (including statutory, regulatory or other citation): Title 2, Subtitle A Chapter II Part 200 Subpart D 200.303 Internal controls states: ?The non-Federal entity must: (a) 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).? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.318(i) General procurement standards state: ?The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.? Title 2, Subtitle A Chapter II Part 200 Subpart D 200.320(a)(2)(i) Small purchase procedures state: ?The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity.? Condition: During our testing over small purchase procurements, we observed management did not have effective internal controls in place to ensure that price or rate quotations were obtained from an adequate number of qualified sources at the time of procurement. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria or specific requirement section above. Effect or potential effect: Small purchase procurements were not supported by effective internal controls and could potentially include unreasonable prices or rates. Questioned costs: None. Context: We tested the entire population of small purchase procurements, which consisted of two purchases totaling $25,353. Price or rate quotations were not obtained from an adequate number of qualified sources at the time of procurement for the two purchases. Identification as a repeat finding, if applicable: No. Recommendation: We recommend that management develop and implement internal controls to support the performance and documentation of small purchase procurement transactions. Views of responsible officials: Valleywise Health management will develop and implement additional layer of review regarding vendor selection and pricing quote for supplies and services to ensure compliance with federal guidelines on expenditures.