FAC Explorer

Audit 9501

FY End
2023-06-30
Total Expended
$17.81M
Findings
2
Programs
5
Organization: Pipestone County Medical Center (MN)
Year: 2023 Accepted: 2024-01-04
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
7373 2023-003 Material Weakness - ABL
583815 2023-003 Material Weakness - ABL

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $16.69M Yes 0
93.498 Covid-19 Provider Relief Fund $860,526 Yes 1
93.155 Covid-19 Rural Health Research Centers $244,084 - 0
93.301 Small Rural Hospital Improvement Grant Program $11,086 - 0
93.461 Covid-19 Testing for the Uninsured $4,345 - 0

Contacts

Name Title Type
NL3YAWLVSGK1 Sandra Schlechter Auditee
5078256079 Joy Feige Auditor
No contacts on file

Notes to SEFA

Title: Community Facilities Loans Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Pipestone County Medical Center (Medical Center) under programs of the federal government for the year ended June 30, 2023. 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 Medical Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Medical Center. Expenditures reported on the schedule are reported on the accrual basis of accounting, with the exception for the COVID-19 HRSA Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program), are based on when the claim is determined eligible 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 Medical Center has not elected to use the 10% de minimis cost rate. Expenditures reporting in this schedule consist of the beginning of the year outstanding balance for the Series 2016A and 2016B Medical Center Bonds directly with United Stated Department of Agriculture (USDA). There were no loan advances during the year ended June 30, 2023. The outstanding balance at June 30, 2023 was $16,366,303 for the Series 2016A and 2016B bonds.
Title: Provider Relief Funds and American Rescue Plan (ARP) Rural Distribution Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Pipestone County Medical Center (Medical Center) under programs of the federal government for the year ended June 30, 2023. 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 Medical Center, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Medical Center. Expenditures reported on the schedule are reported on the accrual basis of accounting, with the exception for the COVID-19 HRSA Claims Reimbursement for the Uninsured Program and the COVID-19 Coverage Assistance Fund (Uninsured Program), are based on when the claim is determined eligible 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 Medical Center has not elected to use the 10% de minimis cost rate. The Medical 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 $5,138,734, excluding interest income. In accordance with the 2023 compliance supplement, the PRF expenditures recognized on the schedule are based on the reporting to HHS for Period 4, defined as payments received during July 1, 2021 to December 31, 2021 and Period 5, defined as payments received during January 1, 2022 to June 30, 2022, as required under the PRF program. The Medical Center did not receive funding during period 5. 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 financial statements. (See Report for Table)

Finding Details

Finding 2023-003
2023-003 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# 411392082 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Control over Compliance and Noncompliance 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. Condition: There were the expenses claimed under general and administrative category that were in excess of the amounts actually incurred under the program. Also, there was a duplication of utility expenses already claimed for the month of November 2021. Cause: The Medical Center claimed general and administrative costs that did not agree to supporting documentation due to clerical errors within the final expenditure listing. Effect: Expenditures included within the special report submitted to the Department of Health and Human Services for Period 4 TIN# 411392082 relating to general and administrative expenses were overstated by $53,954. Questioned Costs: The Medical Center has additional lost revenue in Period 4 that exceeds the general and administrative expenses. As a result, there are no questioned costs for activities allowed or unallowed and allowable costs/cost principles. Expenses included within the special report were overstated by $53,954. Context/Sampling: Summary level testing was performed over mortgage, utilities, and insurance. Key line items were tested on the Period 4 Department of Health and Human Services special report. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a control process that reviews the clerical accuracy to the supporting detail being used to claim the allowable costs under the program. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-003
2023-003 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# 411392082 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Control over Compliance and Noncompliance 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. Condition: There were the expenses claimed under general and administrative category that were in excess of the amounts actually incurred under the program. Also, there was a duplication of utility expenses already claimed for the month of November 2021. Cause: The Medical Center claimed general and administrative costs that did not agree to supporting documentation due to clerical errors within the final expenditure listing. Effect: Expenditures included within the special report submitted to the Department of Health and Human Services for Period 4 TIN# 411392082 relating to general and administrative expenses were overstated by $53,954. Questioned Costs: The Medical Center has additional lost revenue in Period 4 that exceeds the general and administrative expenses. As a result, there are no questioned costs for activities allowed or unallowed and allowable costs/cost principles. Expenses included within the special report were overstated by $53,954. Context/Sampling: Summary level testing was performed over mortgage, utilities, and insurance. Key line items were tested on the Period 4 Department of Health and Human Services special report. Repeat Finding from Prior Years: No Recommendation: We recommend implementing a control process that reviews the clerical accuracy to the supporting detail being used to claim the allowable costs under the program. Views of Responsible Officials: Management agrees with the finding.