FAC Explorer

Audit 53719

FY End
2022-12-31
Total Expended
$30.07M
Findings
4
Programs
2
Organization: St John's Health Care Corporation (NY)
Year: 2022 Accepted: 2023-08-08
Auditor: Bonadio & CO LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
50952 2022-001 Significant Deficiency - P
50953 2022-001 Significant Deficiency - P
627394 2022-001 Significant Deficiency - P
627395 2022-001 Significant Deficiency - P

Programs

ALN Program Spent Major Findings
14.129 Mortgage Insurance_nursing Homes, Intermediate Care Facilities, Board and Care Homes and Assisted Living Facilities $12.78M Yes 1
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $1.15M Yes 0

Contacts

Name Title Type
TJ9LLCJD19C3 Robert Earl Auditee
5857601473 Amanda L. Della Sala Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) presents theactivity of federal award programs of St. Johns Health Care Corporation (the Home). Theschedule includes expenditures of federal programs received directly from federal agencies.The accompanying schedule of expenditures of federal awards, as required by Title 2 U.SCode of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,and Audit Requirements for Federal Awards (Uniform Guidance), is prepared in accordancewith accounting principles generally accepted in the United States of America. Because theschedule presents only a selected portion of the operations of entity, it is not intended to anddoes not present the financial position, changes in net deficit, or cash flow of the Home. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. MORTGAGE INSURANCE_NURSING HOMES, INTERMEDIATE CARE FACILITIES, BOARD AND CARE HOMES AND ASSISTED LIVING FACILITIES (14.129) - Balances outstanding at the end of the audit period were 11532566.
Title: DEBT REFINANCING Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) presents theactivity of federal award programs of St. Johns Health Care Corporation (the Home). Theschedule includes expenditures of federal programs received directly from federal agencies.The accompanying schedule of expenditures of federal awards, as required by Title 2 U.SCode of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,and Audit Requirements for Federal Awards (Uniform Guidance), is prepared in accordancewith accounting principles generally accepted in the United States of America. Because theschedule presents only a selected portion of the operations of entity, it is not intended to anddoes not present the financial position, changes in net deficit, or cash flow of the Home. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. In January 2022, the Home refinanced its existing mortgage obligation for Project Number 014-43110, which was insured by the U.S. Department of Housing and Urban Development. The proceeds from the new $12,778,600 HUD obligation for Project Number 014-43221 satisfied the prior mortgage obligation. In addition, the Home established new reserve accounts in accordance with the terms of the new mortgage loan. At the time the mortgage was refinanced, the balance of the underlying DASNY bond obligations was less than theoutstanding mortgage balance, resulting in a gain of $3,159,584.
Title: COVID-19: DISASTER GRANTS PUBLIC ASSISTANCE (FEMA) Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) presents theactivity of federal award programs of St. Johns Health Care Corporation (the Home). Theschedule includes expenditures of federal programs received directly from federal agencies.The accompanying schedule of expenditures of federal awards, as required by Title 2 U.SCode of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,and Audit Requirements for Federal Awards (Uniform Guidance), is prepared in accordancewith accounting principles generally accepted in the United States of America. Because theschedule presents only a selected portion of the operations of entity, it is not intended to anddoes not present the financial position, changes in net deficit, or cash flow of the Home. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The amount included in the schedule of expenditures of federal awards is based upon theFEMA project worksheets.

Finding Details

Finding 2022-001
Program: U.S. Department of Housing and Urban Development (HUD) Mortgage Insurance - Nursing Homes, Intermediate Care Facilities, Board and Care Homes, and Assisted Living Facilities (Section 232) Assistance Listing #14.129. Condition: During 2022, the Home received a U.S. Small Business Administration loan without obtaining prior HUD approval. Criteria: The HUD regulatory agreement states there shall not be an encumbrance of any of the mortgaged property without prior written approval of HUD. Context: During testing of debt, it was noted that the Home entered into a loan agreement with the U.S. Small Business Administration. Cause: The Home experienced decreased occupancy, increased labor, benefits and supply expenditures as a lingering impact of the COVID-19 pandemic. It utilized the U.S. Small Business Administration loan as a means to cover operating expenses. Effect: Failure to obtain written approval from HUD constitutes noncompliance with the HUD regulatory agreement. Gross amounts loaned from the U.S. Small Business Administration amounted to $1,999,900 during 2022. Recommendation: Adhere to the HUD regulatory agreement in relation to obtaining prior written approval from HUD before encumbering the Project. Views of Responsible Official of the Auditee: The Home obtained the U.S. Small Business Administration loan as a prudent business decision to meet operating expenses.
Finding 2022-001
Program: U.S. Department of Housing and Urban Development (HUD) Mortgage Insurance - Nursing Homes, Intermediate Care Facilities, Board and Care Homes, and Assisted Living Facilities (Section 232) Assistance Listing #14.129. Condition: During 2022, the Home received a U.S. Small Business Administration loan without obtaining prior HUD approval. Criteria: The HUD regulatory agreement states there shall not be an encumbrance of any of the mortgaged property without prior written approval of HUD. Context: During testing of debt, it was noted that the Home entered into a loan agreement with the U.S. Small Business Administration. Cause: The Home experienced decreased occupancy, increased labor, benefits and supply expenditures as a lingering impact of the COVID-19 pandemic. It utilized the U.S. Small Business Administration loan as a means to cover operating expenses. Effect: Failure to obtain written approval from HUD constitutes noncompliance with the HUD regulatory agreement. Gross amounts loaned from the U.S. Small Business Administration amounted to $1,999,900 during 2022. Recommendation: Adhere to the HUD regulatory agreement in relation to obtaining prior written approval from HUD before encumbering the Project. Views of Responsible Official of the Auditee: The Home obtained the U.S. Small Business Administration loan as a prudent business decision to meet operating expenses.
Finding 2022-001
Program: U.S. Department of Housing and Urban Development (HUD) Mortgage Insurance - Nursing Homes, Intermediate Care Facilities, Board and Care Homes, and Assisted Living Facilities (Section 232) Assistance Listing #14.129. Condition: During 2022, the Home received a U.S. Small Business Administration loan without obtaining prior HUD approval. Criteria: The HUD regulatory agreement states there shall not be an encumbrance of any of the mortgaged property without prior written approval of HUD. Context: During testing of debt, it was noted that the Home entered into a loan agreement with the U.S. Small Business Administration. Cause: The Home experienced decreased occupancy, increased labor, benefits and supply expenditures as a lingering impact of the COVID-19 pandemic. It utilized the U.S. Small Business Administration loan as a means to cover operating expenses. Effect: Failure to obtain written approval from HUD constitutes noncompliance with the HUD regulatory agreement. Gross amounts loaned from the U.S. Small Business Administration amounted to $1,999,900 during 2022. Recommendation: Adhere to the HUD regulatory agreement in relation to obtaining prior written approval from HUD before encumbering the Project. Views of Responsible Official of the Auditee: The Home obtained the U.S. Small Business Administration loan as a prudent business decision to meet operating expenses.
Finding 2022-001
Program: U.S. Department of Housing and Urban Development (HUD) Mortgage Insurance - Nursing Homes, Intermediate Care Facilities, Board and Care Homes, and Assisted Living Facilities (Section 232) Assistance Listing #14.129. Condition: During 2022, the Home received a U.S. Small Business Administration loan without obtaining prior HUD approval. Criteria: The HUD regulatory agreement states there shall not be an encumbrance of any of the mortgaged property without prior written approval of HUD. Context: During testing of debt, it was noted that the Home entered into a loan agreement with the U.S. Small Business Administration. Cause: The Home experienced decreased occupancy, increased labor, benefits and supply expenditures as a lingering impact of the COVID-19 pandemic. It utilized the U.S. Small Business Administration loan as a means to cover operating expenses. Effect: Failure to obtain written approval from HUD constitutes noncompliance with the HUD regulatory agreement. Gross amounts loaned from the U.S. Small Business Administration amounted to $1,999,900 during 2022. Recommendation: Adhere to the HUD regulatory agreement in relation to obtaining prior written approval from HUD before encumbering the Project. Views of Responsible Official of the Auditee: The Home obtained the U.S. Small Business Administration loan as a prudent business decision to meet operating expenses.