FAC Explorer

Audit 54088

FY End
2022-06-30
Total Expended
$8.61M
Findings
4
Programs
2
Organization: Bethany Lutheran Home for the Aged, Inc. (SD)
Year: 2022 Accepted: 2022-12-28
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
62268 2022-003 Material Weakness - N
62269 2022-003 Material Weakness - N
638710 2022-003 Material Weakness - N
638711 2022-003 Material Weakness - N

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $5.88M Yes 1
93.498 Provider Relief Fund $516,045 - 0

Contacts

Name Title Type
P8E5L9F58NS1 Dalton Huber Auditee
6052757167 Joy Feige Auditor
No contacts on file

Notes to SEFA

Title: Community Facilities Loan Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. Expenditures reported in this schedule consist of the beginning of the year outstanding loan balance for the direct loan and the guaranteed Senior Secured Rural America Bonds Series 2011A. There were no loan advances during the year ended June 30, 2022. The outstanding balance at June 30, 2022, was $2,179,979 for the direct USDA loan and $5,679,744 for the guaranteed Series 2011A bonds.
Title: Basis of Presentation Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The accompanying consolidated schedule of expenditures of federal awards (the schedule) includes the federal award activity of Bethany Lutheran Home for the Aged, Inc. (the Organization) under programs of the federal government for the year ended June 30, 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 Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization.
Title: Provider Relief Funds Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. 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 Organization does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The Organization received amounts from the U.S. Department of Health and Human Services (HHS) through the Provider Relief Fund and American Rescue Plan Rural Distribution (PRF) program (Federal Financial Assistance Listing/CFDA #93.498) in the amount of $1,328,803 as of June 30, 2022. 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.The following summarizes the Provider Relief Funds and the timing of when the amounts were recognized in the consolidated financial statements.(see table in report)

Finding Details

Finding 2022-003
2022-003 Department of Agriculture Federal Financial Assistance Listing/CFDA #10.766 Communities Facilities and Loans Grants Cluster Special Tests & Provisions Material Weakness 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. Section 4 of the Loan Resolution Security Agreement dated October 18, 2012, states the Organization must set aside a reserve amount which may be established as a bookkeeping account or as a separate bank account. Funds may be deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Condition: Management did not have access to the relevant documents and was unaware of the USDA reserve requirement until further discussion with USDA. The Organization had cash balances on hand exceeding the required reserve amount; however, the funds were not segregated in a separate bookkeeping account or bank account. Cause: Management did not have access to the relevant documents that stated the required reserve amount. Effect: The Organization could be in violation of the reserve amount requirements if management is not monitoring compliance. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management transfer the required reserve amount to a separate bookkeeping account in the trial balance or establish a separate bank account and ensure the funds are deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Controls should be established and documented to monitor compliance with the reserve fund provisions. Views of Responsible Officials: Management agrees with the finding
Finding 2022-003
2022-003 Department of Agriculture Federal Financial Assistance Listing/CFDA #10.766 Communities Facilities and Loans Grants Cluster Special Tests & Provisions Material Weakness 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. Section 4 of the Loan Resolution Security Agreement dated October 18, 2012, states the Organization must set aside a reserve amount which may be established as a bookkeeping account or as a separate bank account. Funds may be deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Condition: Management did not have access to the relevant documents and was unaware of the USDA reserve requirement until further discussion with USDA. The Organization had cash balances on hand exceeding the required reserve amount; however, the funds were not segregated in a separate bookkeeping account or bank account. Cause: Management did not have access to the relevant documents that stated the required reserve amount. Effect: The Organization could be in violation of the reserve amount requirements if management is not monitoring compliance. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management transfer the required reserve amount to a separate bookkeeping account in the trial balance or establish a separate bank account and ensure the funds are deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Controls should be established and documented to monitor compliance with the reserve fund provisions. Views of Responsible Officials: Management agrees with the finding
Finding 2022-003
2022-003 Department of Agriculture Federal Financial Assistance Listing/CFDA #10.766 Communities Facilities and Loans Grants Cluster Special Tests & Provisions Material Weakness 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. Section 4 of the Loan Resolution Security Agreement dated October 18, 2012, states the Organization must set aside a reserve amount which may be established as a bookkeeping account or as a separate bank account. Funds may be deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Condition: Management did not have access to the relevant documents and was unaware of the USDA reserve requirement until further discussion with USDA. The Organization had cash balances on hand exceeding the required reserve amount; however, the funds were not segregated in a separate bookkeeping account or bank account. Cause: Management did not have access to the relevant documents that stated the required reserve amount. Effect: The Organization could be in violation of the reserve amount requirements if management is not monitoring compliance. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management transfer the required reserve amount to a separate bookkeeping account in the trial balance or establish a separate bank account and ensure the funds are deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Controls should be established and documented to monitor compliance with the reserve fund provisions. Views of Responsible Officials: Management agrees with the finding
Finding 2022-003
2022-003 Department of Agriculture Federal Financial Assistance Listing/CFDA #10.766 Communities Facilities and Loans Grants Cluster Special Tests & Provisions Material Weakness 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. Section 4 of the Loan Resolution Security Agreement dated October 18, 2012, states the Organization must set aside a reserve amount which may be established as a bookkeeping account or as a separate bank account. Funds may be deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Condition: Management did not have access to the relevant documents and was unaware of the USDA reserve requirement until further discussion with USDA. The Organization had cash balances on hand exceeding the required reserve amount; however, the funds were not segregated in a separate bookkeeping account or bank account. Cause: Management did not have access to the relevant documents that stated the required reserve amount. Effect: The Organization could be in violation of the reserve amount requirements if management is not monitoring compliance. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year: No Recommendation: We recommend management transfer the required reserve amount to a separate bookkeeping account in the trial balance or establish a separate bank account and ensure the funds are deposited in institutions insured by the state or federal government or invested in marketable securities backed by the full faith and credit of the United States. Controls should be established and documented to monitor compliance with the reserve fund provisions. Views of Responsible Officials: Management agrees with the finding