2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-101 Lack of Internal Controls over the Application of the Sliding Fee Scale (repeated, prior two years 2023-101 and 2022-101) (initially reported 2014) Assistance Listing Number: 93.224 and 93.527 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program Compliance Requirement: Special Tests and Provisions – Sliding Fee Discounts Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), COVID-19 H8L50549 (2023), and COVID-19 H8G48569 (2022). Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: The Organization lacks consistently applied processes and procedures related to the application of the sliding fee scale. The Organization also lacks a clear review process related to the sliding fee scale to identify errors quickly to allow for corrections to be made in a timely manner. This has been a systemic issue as a repeat finding in the prior years. The sample was not statistically valid. - Sliding fee scales were not used for the agreement that the Organization has in place with the local school district in which they provide services to students. The agreement specifically does not allow the Organization to obtain information related to household size and income as needed to appropriately place the family on the sliding fee scale. The agreement also indicates no amounts can be collected from the students, except when that student has insurance which allows the Organization to bill the insurance company for a portion of the fees. - Sliding fee scales are not used in the disaster recovery bus program that does not charge the patients for services. - Thirteen of the sixty encounters sampled where the sliding scale was used had the wrong sliding fee scale applied based on information obtained about the patient’s family size and income. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Health centers must prepare and apply a sliding fee discount schedule, so that the amounts owed for health center services by eligible patients are adjusted based on the patient's ability to pay (42 U.S.C 254b(k)(3)(G)(i)). The patient's ability to pay is based on the official poverty guidelines, as revised annually by the U.S. Department of Health and Human Services (42 U.S.C 9902(2)). Cause: Failure to apply the sliding fee correctly, as noted in 13 of the encounters above, was due to improper staff training or failure to properly monitor the process. Failure to apply the sliding fee scales due to the requirements of the agreement with the local school district and procedures applied to the disaster recovery bus program do not follow the written procedures of the Organization for use of the sliding fee scale. Effect: The Organization could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation: Staff should be consistently trained in how patients should complete the intake forms, including the sliding fee scale application, and require patients complete the form appropriately, including refusal to provide information, if applicable. Staff should also be consistently trained in what documentation is considered sufficient to support income identified as well as verify the application is consistent with the documentation and, when needed, clearly document the reasons for inconsistency. Staff should make every effort to obtain documentation of patient income in accordance with internal policies and procedures. Patients should be billed the usual and customary billing rates for all services until all documentation is received, or policies are adjusted to allow for self-determination by patients in certain situations. A process should be put in place to track patients to attempt further collection of the necessary data that would allow for adjustment of the bill after the fact when necessary. These exceptions should be tracked each month with the monthly review by the regional operations managers. The reviews by the regional operations managers should be documented and retained including the results and corrective action of the follow-up on deficiencies noted. The Organization should discuss with HRSA what could be done to either adjust policies and procedures used during the school visits to be compliant or obtain a waiver from HRSA to indicate their knowledge and approval of the school visits and disaster bus program visits not being compliant with the application of the sliding fee scale requirements. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The Billing and Collections Policy was updated to waive co-pays for students in the School-Based Program. The Billing Department is in the process of auditing and implementing quarterly feedback & training sessions for the Operations Department for training and compliance for the Sliding Fee Discount Program. This process was implemented in 2025.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-101 Lack of Internal Controls over the Application of the Sliding Fee Scale (repeated, prior two years 2023-101 and 2022-101) (initially reported 2014) Assistance Listing Number: 93.224 and 93.527 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program Compliance Requirement: Special Tests and Provisions – Sliding Fee Discounts Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), COVID-19 H8L50549 (2023), and COVID-19 H8G48569 (2022). Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: The Organization lacks consistently applied processes and procedures related to the application of the sliding fee scale. The Organization also lacks a clear review process related to the sliding fee scale to identify errors quickly to allow for corrections to be made in a timely manner. This has been a systemic issue as a repeat finding in the prior years. The sample was not statistically valid. - Sliding fee scales were not used for the agreement that the Organization has in place with the local school district in which they provide services to students. The agreement specifically does not allow the Organization to obtain information related to household size and income as needed to appropriately place the family on the sliding fee scale. The agreement also indicates no amounts can be collected from the students, except when that student has insurance which allows the Organization to bill the insurance company for a portion of the fees. - Sliding fee scales are not used in the disaster recovery bus program that does not charge the patients for services. - Thirteen of the sixty encounters sampled where the sliding scale was used had the wrong sliding fee scale applied based on information obtained about the patient’s family size and income. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Health centers must prepare and apply a sliding fee discount schedule, so that the amounts owed for health center services by eligible patients are adjusted based on the patient's ability to pay (42 U.S.C 254b(k)(3)(G)(i)). The patient's ability to pay is based on the official poverty guidelines, as revised annually by the U.S. Department of Health and Human Services (42 U.S.C 9902(2)). Cause: Failure to apply the sliding fee correctly, as noted in 13 of the encounters above, was due to improper staff training or failure to properly monitor the process. Failure to apply the sliding fee scales due to the requirements of the agreement with the local school district and procedures applied to the disaster recovery bus program do not follow the written procedures of the Organization for use of the sliding fee scale. Effect: The Organization could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation: Staff should be consistently trained in how patients should complete the intake forms, including the sliding fee scale application, and require patients complete the form appropriately, including refusal to provide information, if applicable. Staff should also be consistently trained in what documentation is considered sufficient to support income identified as well as verify the application is consistent with the documentation and, when needed, clearly document the reasons for inconsistency. Staff should make every effort to obtain documentation of patient income in accordance with internal policies and procedures. Patients should be billed the usual and customary billing rates for all services until all documentation is received, or policies are adjusted to allow for self-determination by patients in certain situations. A process should be put in place to track patients to attempt further collection of the necessary data that would allow for adjustment of the bill after the fact when necessary. These exceptions should be tracked each month with the monthly review by the regional operations managers. The reviews by the regional operations managers should be documented and retained including the results and corrective action of the follow-up on deficiencies noted. The Organization should discuss with HRSA what could be done to either adjust policies and procedures used during the school visits to be compliant or obtain a waiver from HRSA to indicate their knowledge and approval of the school visits and disaster bus program visits not being compliant with the application of the sliding fee scale requirements. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The Billing and Collections Policy was updated to waive co-pays for students in the School-Based Program. The Billing Department is in the process of auditing and implementing quarterly feedback & training sessions for the Operations Department for training and compliance for the Sliding Fee Discount Program. This process was implemented in 2025.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-101 Lack of Internal Controls over the Application of the Sliding Fee Scale (repeated, prior two years 2023-101 and 2022-101) (initially reported 2014) Assistance Listing Number: 93.224 and 93.527 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program Compliance Requirement: Special Tests and Provisions – Sliding Fee Discounts Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), COVID-19 H8L50549 (2023), and COVID-19 H8G48569 (2022). Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: The Organization lacks consistently applied processes and procedures related to the application of the sliding fee scale. The Organization also lacks a clear review process related to the sliding fee scale to identify errors quickly to allow for corrections to be made in a timely manner. This has been a systemic issue as a repeat finding in the prior years. The sample was not statistically valid. - Sliding fee scales were not used for the agreement that the Organization has in place with the local school district in which they provide services to students. The agreement specifically does not allow the Organization to obtain information related to household size and income as needed to appropriately place the family on the sliding fee scale. The agreement also indicates no amounts can be collected from the students, except when that student has insurance which allows the Organization to bill the insurance company for a portion of the fees. - Sliding fee scales are not used in the disaster recovery bus program that does not charge the patients for services. - Thirteen of the sixty encounters sampled where the sliding scale was used had the wrong sliding fee scale applied based on information obtained about the patient’s family size and income. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Health centers must prepare and apply a sliding fee discount schedule, so that the amounts owed for health center services by eligible patients are adjusted based on the patient's ability to pay (42 U.S.C 254b(k)(3)(G)(i)). The patient's ability to pay is based on the official poverty guidelines, as revised annually by the U.S. Department of Health and Human Services (42 U.S.C 9902(2)). Cause: Failure to apply the sliding fee correctly, as noted in 13 of the encounters above, was due to improper staff training or failure to properly monitor the process. Failure to apply the sliding fee scales due to the requirements of the agreement with the local school district and procedures applied to the disaster recovery bus program do not follow the written procedures of the Organization for use of the sliding fee scale. Effect: The Organization could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation: Staff should be consistently trained in how patients should complete the intake forms, including the sliding fee scale application, and require patients complete the form appropriately, including refusal to provide information, if applicable. Staff should also be consistently trained in what documentation is considered sufficient to support income identified as well as verify the application is consistent with the documentation and, when needed, clearly document the reasons for inconsistency. Staff should make every effort to obtain documentation of patient income in accordance with internal policies and procedures. Patients should be billed the usual and customary billing rates for all services until all documentation is received, or policies are adjusted to allow for self-determination by patients in certain situations. A process should be put in place to track patients to attempt further collection of the necessary data that would allow for adjustment of the bill after the fact when necessary. These exceptions should be tracked each month with the monthly review by the regional operations managers. The reviews by the regional operations managers should be documented and retained including the results and corrective action of the follow-up on deficiencies noted. The Organization should discuss with HRSA what could be done to either adjust policies and procedures used during the school visits to be compliant or obtain a waiver from HRSA to indicate their knowledge and approval of the school visits and disaster bus program visits not being compliant with the application of the sliding fee scale requirements. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The Billing and Collections Policy was updated to waive co-pays for students in the School-Based Program. The Billing Department is in the process of auditing and implementing quarterly feedback & training sessions for the Operations Department for training and compliance for the Sliding Fee Discount Program. This process was implemented in 2025.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-101 Lack of Internal Controls over the Application of the Sliding Fee Scale (repeated, prior two years 2023-101 and 2022-101) (initially reported 2014) Assistance Listing Number: 93.224 and 93.527 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program Compliance Requirement: Special Tests and Provisions – Sliding Fee Discounts Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), COVID-19 H8L50549 (2023), and COVID-19 H8G48569 (2022). Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: The Organization lacks consistently applied processes and procedures related to the application of the sliding fee scale. The Organization also lacks a clear review process related to the sliding fee scale to identify errors quickly to allow for corrections to be made in a timely manner. This has been a systemic issue as a repeat finding in the prior years. The sample was not statistically valid. - Sliding fee scales were not used for the agreement that the Organization has in place with the local school district in which they provide services to students. The agreement specifically does not allow the Organization to obtain information related to household size and income as needed to appropriately place the family on the sliding fee scale. The agreement also indicates no amounts can be collected from the students, except when that student has insurance which allows the Organization to bill the insurance company for a portion of the fees. - Sliding fee scales are not used in the disaster recovery bus program that does not charge the patients for services. - Thirteen of the sixty encounters sampled where the sliding scale was used had the wrong sliding fee scale applied based on information obtained about the patient’s family size and income. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Health centers must prepare and apply a sliding fee discount schedule, so that the amounts owed for health center services by eligible patients are adjusted based on the patient's ability to pay (42 U.S.C 254b(k)(3)(G)(i)). The patient's ability to pay is based on the official poverty guidelines, as revised annually by the U.S. Department of Health and Human Services (42 U.S.C 9902(2)). Cause: Failure to apply the sliding fee correctly, as noted in 13 of the encounters above, was due to improper staff training or failure to properly monitor the process. Failure to apply the sliding fee scales due to the requirements of the agreement with the local school district and procedures applied to the disaster recovery bus program do not follow the written procedures of the Organization for use of the sliding fee scale. Effect: The Organization could be incorrectly billing for services and maintaining customer account balances at incorrect amounts. Recommendation: Staff should be consistently trained in how patients should complete the intake forms, including the sliding fee scale application, and require patients complete the form appropriately, including refusal to provide information, if applicable. Staff should also be consistently trained in what documentation is considered sufficient to support income identified as well as verify the application is consistent with the documentation and, when needed, clearly document the reasons for inconsistency. Staff should make every effort to obtain documentation of patient income in accordance with internal policies and procedures. Patients should be billed the usual and customary billing rates for all services until all documentation is received, or policies are adjusted to allow for self-determination by patients in certain situations. A process should be put in place to track patients to attempt further collection of the necessary data that would allow for adjustment of the bill after the fact when necessary. These exceptions should be tracked each month with the monthly review by the regional operations managers. The reviews by the regional operations managers should be documented and retained including the results and corrective action of the follow-up on deficiencies noted. The Organization should discuss with HRSA what could be done to either adjust policies and procedures used during the school visits to be compliant or obtain a waiver from HRSA to indicate their knowledge and approval of the school visits and disaster bus program visits not being compliant with the application of the sliding fee scale requirements. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The Billing and Collections Policy was updated to waive co-pays for students in the School-Based Program. The Billing Department is in the process of auditing and implementing quarterly feedback & training sessions for the Operations Department for training and compliance for the Sliding Fee Discount Program. This process was implemented in 2025.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-102 Absence of Physical Inventory of Property (Initially reported 2024) Assistance Listing Number: 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Rural Telemedicine Grants Compliance Requirement: Equipment and Real Property Management Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: GA142923 (2021) and G2846293 (2022) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not perform a physical inventory of property purchased with federal awards that could be reconciled back to the capital assets records. This is a systemic issue that has been included as a management point in prior years. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under the compliance requirements for equipment and real property management, nonfederal entities should maintain proper records for equipment and real property and adequately safeguard and maintain equipment and real property that is purchased with federal awards. Cause: The Organization has not implemented an annual physical inventory of property. Effect: The Organization may not be able to adequately track acquisitions and disposals of assets purchased with federal awards. Recommendation: We recommend that the Organization perform an annual inventory of all physical assets purchased with federal awards. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and will implement procedures to ensure a physical inventory of property purchased with federal awards is conducted annually and reconciled to capital asset records. With the recent hiring of a Chief Financial Officer and additional finance staff, the Organization is establishing written procedures that require staff to schedule and perform an annual physical inspection of all federally funded property, compare results to the capital asset ledger, and investigate and resolve any discrepancies. Documentation of the physical inventory and reconciliation will be retained for management review and audit purposes.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-107 Incorrect Costs were Submitted for Reimbursement (Initially reported 2024) Assistance Listing Number: 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Rural Telemedicine Grants Compliance Requirement: Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: GA142923 (2021), G2846293 (2022), and GA3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $68 known and $589 likely Condition: The September 2024 reimbursement request included one instance, out of 37 items tested, where calculations of personnel expenditures allocable to the grant used an inaccurate amount, resulting in an overcharge of personnel expenditures. In calculating the allocable expenditure, wages for the month of August, which had previously been charged to the grant, were used to calculate the amount allocable to the grant for the month of September. Gross wages for August exceeded gross wages for September. Wages for both months were allowable and allocable to the grant. This is not a systemic problem but an isolated occurrence resulting in an immaterial difference in the amount reimbursed and the amount that should have been requested for September 2024 wages paid. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Per 2 CFR 200.430(g), costs charged to federal awards must be supported by records that- support the distribution of salaries and wages among specific activities, while reflecting the total activity of the employee, not to exceed 100% of compensated activities. Cause: Wages requested for reimbursement in September 2024 reflected the wages paid in August 2024 in error and were not detected during the review process over the reimbursement request. Effect: Personnel costs charged to the award were based on amounts exceeding 100% of the employee’s compensation for one month, resulting in an overcharge to the award. Recommendation: Review of costs allocated and requested for reimbursement should incorporate consideration of the period the costs were incurred. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have strengthened our review process for reimbursement requests to prevent similar errors. Finance staff verify payroll periods against reimbursement periods before submission, and supervisors perform an additional review. This process includes careful cross-checking against the appropriate pay periods. This was an isolated occurrence with immaterial impact, but corrective steps will ensure accuracy in future requests.
2024-102 Absence of Physical Inventory of Property (Initially reported 2024) Assistance Listing Number: 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Rural Telemedicine Grants Compliance Requirement: Equipment and Real Property Management Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: GA142923 (2021) and G2846293 (2022) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not perform a physical inventory of property purchased with federal awards that could be reconciled back to the capital assets records. This is a systemic issue that has been included as a management point in prior years. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under the compliance requirements for equipment and real property management, nonfederal entities should maintain proper records for equipment and real property and adequately safeguard and maintain equipment and real property that is purchased with federal awards. Cause: The Organization has not implemented an annual physical inventory of property. Effect: The Organization may not be able to adequately track acquisitions and disposals of assets purchased with federal awards. Recommendation: We recommend that the Organization perform an annual inventory of all physical assets purchased with federal awards. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and will implement procedures to ensure a physical inventory of property purchased with federal awards is conducted annually and reconciled to capital asset records. With the recent hiring of a Chief Financial Officer and additional finance staff, the Organization is establishing written procedures that require staff to schedule and perform an annual physical inspection of all federally funded property, compare results to the capital asset ledger, and investigate and resolve any discrepancies. Documentation of the physical inventory and reconciliation will be retained for management review and audit purposes.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-107 Incorrect Costs were Submitted for Reimbursement (Initially reported 2024) Assistance Listing Number: 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Rural Telemedicine Grants Compliance Requirement: Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: GA142923 (2021), G2846293 (2022), and GA3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $68 known and $589 likely Condition: The September 2024 reimbursement request included one instance, out of 37 items tested, where calculations of personnel expenditures allocable to the grant used an inaccurate amount, resulting in an overcharge of personnel expenditures. In calculating the allocable expenditure, wages for the month of August, which had previously been charged to the grant, were used to calculate the amount allocable to the grant for the month of September. Gross wages for August exceeded gross wages for September. Wages for both months were allowable and allocable to the grant. This is not a systemic problem but an isolated occurrence resulting in an immaterial difference in the amount reimbursed and the amount that should have been requested for September 2024 wages paid. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Per 2 CFR 200.430(g), costs charged to federal awards must be supported by records that- support the distribution of salaries and wages among specific activities, while reflecting the total activity of the employee, not to exceed 100% of compensated activities. Cause: Wages requested for reimbursement in September 2024 reflected the wages paid in August 2024 in error and were not detected during the review process over the reimbursement request. Effect: Personnel costs charged to the award were based on amounts exceeding 100% of the employee’s compensation for one month, resulting in an overcharge to the award. Recommendation: Review of costs allocated and requested for reimbursement should incorporate consideration of the period the costs were incurred. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have strengthened our review process for reimbursement requests to prevent similar errors. Finance staff verify payroll periods against reimbursement periods before submission, and supervisors perform an additional review. This process includes careful cross-checking against the appropriate pay periods. This was an isolated occurrence with immaterial impact, but corrective steps will ensure accuracy in future requests.
2024-104 Lack of Controls Related to Filing Reports (repeated, prior years 2023-104) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Reporting Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), C1650381 (2023), COVID-19 H8L50549 (2023), COVID-19 H8G48569 (2022).GA142923 (2021) G2846293 (2022) and G3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $0 Condition: The Organization did not maintain proper documentation to support the review of the report prior to submission to the grantor, other than the review done by the preparer. In four of the reports selected for testing under ALN 93.224 and 93.527 two reports did not have documentation of approval by the CEO prior to submission. In three of the reports selected for testing under ALN 93.211 two reports did not have documentation of approval by the CEO prior to submission. This is a systemic issue that has been a finding in the previous year. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Cause: The Organization did not have a process in place for review of the data being reported on the HRSA website for the funds being expensed under the federal award programs. Effect: The Organization could submit incorrect information. Recommendation: Documentation should be kept that clearly documents who prepared the information, who reviewed the information, and that the reviewer considered whether the information was complete and accurate. Views of Responsible Officials and Planned Corrective Actions: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. The accounting staff was restructured in November 2024 with the addition of a Finance Manager and Senior Accountant to strengthen internal controls and facilitate segregation of duties best practices for day-to-day activities. In addition to review of month-end journal entries, reporting requirements with additional review was also implemented in 2025.
2024-105 Lack of Payroll Review and Approval (repeated, prior year 2023-105) (initially reported 2023) Assistance Listing Number: 93.224, 93.527 and 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs, Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: No documentation of employee time approval by supervisors could be provided. The payroll clerk processes the payroll, and the finance director approves through the releasing of the payroll. However, there is no formal documentation of the overall review of the payroll process and the supervisors’ approval of time recorded by employees. This is a systemic issue and has been a finding in the previous year. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards The requirement is for the Organization to have a process in place to correctly calculate, record, and pay payroll related expenses in accordance with grant and program requirements. Cause: The Organization does not have an effective process to review, approve, and document the supervisor’s approvals prior to making the payments. Effect: This situation provides an opportunity for errors and unauthorized transactions to occur and not be detected in a timely manner resulting in payroll expenses to be charged incorrectly to the federal awards. Recommendation: In April 2024, the Organization began using a third-party service provider to process payroll resulting in new control processes over the approval of time sheets by supervisors. We recommend that the Organization implement internal control procedures under the new payroll processes to ensure that documentation of supervisor approval of time sheets and subsequent payments is kept on file. Views of Responsible Officials and Planned Corrective Actions: The Organization has implemented a new payroll process using the ADP system. Employees are now required to approve their own time within the ADP portal, and this approval is documented. Following this, supervisors review and approve their employees’ time, which is also documented in the portal. Human Resources then prepares the payroll, reviewing all entries and initialing a shared file of payroll items and providing backup for changes. Once HR confirms accuracy, they notify Finance. Finance then reviews the payroll, with the Finance Manager providing the final approval within ADP once all items are confirmed. This entire process is fully documented, with approvals recorded within ADP by employees and supervisors and the shared file drive where HR and Finance initial off on the reviewed payroll items, ensuring a traceable record of the entire payroll approval process.
2024-106 Lack of Time and Effort Documentation Policy (Initially reported 2024) Assistance Listing Number: 93.224, 93.527 and 93.211. Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) and Grants for New and Expanded Services Under the Health Center Program, and Rural Telemedicine Grants Compliance Requirement: Allowable Activities and Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: H8006452 (2024 and 2023), H2E45500 (2022), H8K49674 (2023), COVID-19 H2E50094 (2023), H8N53812 (2024), H8L50549 (2023), COVID-19 H8G48569 (2022), GA142923 (2021), G2846293(2022) and G3949501 (2023) Finding Type: Material Weakness in Internal Control Questioned Costs: $0 Condition: Time and effort reporting on actual hours spent on individual grant projects used to support the budgeted allocations of employee salary for each grant are not being kept. This is a systemic issue as a procedure for documenting time and effort by employee to justify the allocation of salaries across grants has not been put in place. This is a systematic issue. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Also, under eCFR 2 CFR 200.430 – Compensation – personal services budget estimates do not qualify as support for charges to federal awards. Cause: The Organization has not put into practice a procedure where records are kept with employee salaries spent by hour on individual grants to substantiate the amount of budgeted FTE used on the reimbursement requests. Effect: Budgeted FTE used for reimbursement requests may be inaccurate resulting in incorrect amounts being requested for reimbursement. Recommendation: The Organization should put in place procedures to accurately document employee hours spent on each of the federal awards to support the budgeted FTE used on the reimbursement requests. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have adopted a formal Time and Effort Reporting Policy. Standardized timesheets will be implemented and staff trained within 60 days, with supervisors reviewing submissions. The Finance Manager will monitor records monthly and conduct quarterly reviews to ensure compliance going forward.
2024-107 Incorrect Costs were Submitted for Reimbursement (Initially reported 2024) Assistance Listing Number: 93.211 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Rural Telemedicine Grants Compliance Requirement: Allowable Costs Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: GA142923 (2021), G2846293 (2022), and GA3949501 (2023) Finding Type: Significant Deficiency in Internal Control Questioned Costs: $68 known and $589 likely Condition: The September 2024 reimbursement request included one instance, out of 37 items tested, where calculations of personnel expenditures allocable to the grant used an inaccurate amount, resulting in an overcharge of personnel expenditures. In calculating the allocable expenditure, wages for the month of August, which had previously been charged to the grant, were used to calculate the amount allocable to the grant for the month of September. Gross wages for August exceeded gross wages for September. Wages for both months were allowable and allocable to the grant. This is not a systemic problem but an isolated occurrence resulting in an immaterial difference in the amount reimbursed and the amount that should have been requested for September 2024 wages paid. The sample was not statistically valid. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Per 2 CFR 200.430(g), costs charged to federal awards must be supported by records that- support the distribution of salaries and wages among specific activities, while reflecting the total activity of the employee, not to exceed 100% of compensated activities. Cause: Wages requested for reimbursement in September 2024 reflected the wages paid in August 2024 in error and were not detected during the review process over the reimbursement request. Effect: Personnel costs charged to the award were based on amounts exceeding 100% of the employee’s compensation for one month, resulting in an overcharge to the award. Recommendation: Review of costs allocated and requested for reimbursement should incorporate consideration of the period the costs were incurred. Views of Responsible Officials and Planned Corrective Action: We acknowledge the finding and have strengthened our review process for reimbursement requests to prevent similar errors. Finance staff verify payroll periods against reimbursement periods before submission, and supervisors perform an additional review. This process includes careful cross-checking against the appropriate pay periods. This was an isolated occurrence with immaterial impact, but corrective steps will ensure accuracy in future requests.
2024 – 003 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2402LLIEA 6/1/2024; 2302ILLIEI 3/1/2023; G 2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038 Award Period: June 1, 2024 through September 30, 2025; March 1, 2023 through August 31, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.308, 200.309, and 200.403(h)) requires that only allowable costs incurred during the approved budget period of a federal award’s period of performance be charged to the award. Effective internal controls should include procedures that involve costs charged to federal awards being reviewed and approved for proper period of performance. Condition: The County charged costs to the federal award after the end of the period of performance. Furthermore, although payroll transactions charged to the federal award were reviewed and approved, documentation of such review was not retained. Questioned Costs: $706 Context: 4 of 97 transactions tested were incurred after the period of performance end date. All 18 payroll transactions tested lacked documentation of review and approval. Cause: Costs were inadvertently claimed outside the period of performance. Documentation of review and approval for payroll transactions was also not retained. Effect: Charging costs outside the period of performance can result in unallowable costs being charged to federal awards, which could lead to noncompliance with federal requirements and potential repayment obligations. Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-005. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 003 Period of Performance (Continued) Recommendation: We recommend that the County review and strengthen its internal controls to ensure that only costs incurred within the period of performance are charged. Costs charged to federal awards should be reviewed and approved for proper period of performance, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 003 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2402LLIEA 6/1/2024; 2302ILLIEI 3/1/2023; G 2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038 Award Period: June 1, 2024 through September 30, 2025; March 1, 2023 through August 31, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.308, 200.309, and 200.403(h)) requires that only allowable costs incurred during the approved budget period of a federal award’s period of performance be charged to the award. Effective internal controls should include procedures that involve costs charged to federal awards being reviewed and approved for proper period of performance. Condition: The County charged costs to the federal award after the end of the period of performance. Furthermore, although payroll transactions charged to the federal award were reviewed and approved, documentation of such review was not retained. Questioned Costs: $706 Context: 4 of 97 transactions tested were incurred after the period of performance end date. All 18 payroll transactions tested lacked documentation of review and approval. Cause: Costs were inadvertently claimed outside the period of performance. Documentation of review and approval for payroll transactions was also not retained. Effect: Charging costs outside the period of performance can result in unallowable costs being charged to federal awards, which could lead to noncompliance with federal requirements and potential repayment obligations. Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-005. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 003 Period of Performance (Continued) Recommendation: We recommend that the County review and strengthen its internal controls to ensure that only costs incurred within the period of performance are charged. Costs charged to federal awards should be reviewed and approved for proper period of performance, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 003 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2402LLIEA 6/1/2024; 2302ILLIEI 3/1/2023; G 2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038 Award Period: June 1, 2024 through September 30, 2025; March 1, 2023 through August 31, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.308, 200.309, and 200.403(h)) requires that only allowable costs incurred during the approved budget period of a federal award’s period of performance be charged to the award. Effective internal controls should include procedures that involve costs charged to federal awards being reviewed and approved for proper period of performance. Condition: The County charged costs to the federal award after the end of the period of performance. Furthermore, although payroll transactions charged to the federal award were reviewed and approved, documentation of such review was not retained. Questioned Costs: $706 Context: 4 of 97 transactions tested were incurred after the period of performance end date. All 18 payroll transactions tested lacked documentation of review and approval. Cause: Costs were inadvertently claimed outside the period of performance. Documentation of review and approval for payroll transactions was also not retained. Effect: Charging costs outside the period of performance can result in unallowable costs being charged to federal awards, which could lead to noncompliance with federal requirements and potential repayment obligations. Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-005. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 003 Period of Performance (Continued) Recommendation: We recommend that the County review and strengthen its internal controls to ensure that only costs incurred within the period of performance are charged. Costs charged to federal awards should be reviewed and approved for proper period of performance, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 003 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2402LLIEA 6/1/2024; 2302ILLIEI 3/1/2023; G 2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038 Award Period: June 1, 2024 through September 30, 2025; March 1, 2023 through August 31, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.308, 200.309, and 200.403(h)) requires that only allowable costs incurred during the approved budget period of a federal award’s period of performance be charged to the award. Effective internal controls should include procedures that involve costs charged to federal awards being reviewed and approved for proper period of performance. Condition: The County charged costs to the federal award after the end of the period of performance. Furthermore, although payroll transactions charged to the federal award were reviewed and approved, documentation of such review was not retained. Questioned Costs: $706 Context: 4 of 97 transactions tested were incurred after the period of performance end date. All 18 payroll transactions tested lacked documentation of review and approval. Cause: Costs were inadvertently claimed outside the period of performance. Documentation of review and approval for payroll transactions was also not retained. Effect: Charging costs outside the period of performance can result in unallowable costs being charged to federal awards, which could lead to noncompliance with federal requirements and potential repayment obligations. Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-005. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 003 Period of Performance (Continued) Recommendation: We recommend that the County review and strengthen its internal controls to ensure that only costs incurred within the period of performance are charged. Costs charged to federal awards should be reviewed and approved for proper period of performance, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 003 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2402LLIEA 6/1/2024; 2302ILLIEI 3/1/2023; G 2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038 Award Period: June 1, 2024 through September 30, 2025; March 1, 2023 through August 31, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.308, 200.309, and 200.403(h)) requires that only allowable costs incurred during the approved budget period of a federal award’s period of performance be charged to the award. Effective internal controls should include procedures that involve costs charged to federal awards being reviewed and approved for proper period of performance. Condition: The County charged costs to the federal award after the end of the period of performance. Furthermore, although payroll transactions charged to the federal award were reviewed and approved, documentation of such review was not retained. Questioned Costs: $706 Context: 4 of 97 transactions tested were incurred after the period of performance end date. All 18 payroll transactions tested lacked documentation of review and approval. Cause: Costs were inadvertently claimed outside the period of performance. Documentation of review and approval for payroll transactions was also not retained. Effect: Charging costs outside the period of performance can result in unallowable costs being charged to federal awards, which could lead to noncompliance with federal requirements and potential repayment obligations. Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-005. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 003 Period of Performance (Continued) Recommendation: We recommend that the County review and strengthen its internal controls to ensure that only costs incurred within the period of performance are charged. Costs charged to federal awards should be reviewed and approved for proper period of performance, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 004 Cash Management Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038; 24-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.305(b)) requires non-federal entities to minimize the time between drawing and disbursing of federal funds; interest should also be calculated on amounts of unearned revenue. Effective internal controls should include procedures that involve reimbursement requests being reviewed and approved prior to submission. Condition: There were instances in which reimbursement requests did not agree to the County’s accounting records or to the amounts reported on the SEFA. The time between receiving and disbursing federal funds was not minimized, and interest on unearned revenue was not calculated. Furthermore, reimbursement requests were not reviewed and approved prior to submission, and documentation of such review was not retained. Questioned Costs: $132,322 Context: 2 of 8 reimbursement requests tested did not have supporting documentation for the exact amount received. All 8 reimbursement requests tested lacked documentation of review and approval prior to submission. Cause: Supporting documentation for reimbursement requests was not complete; specifically, adjustments made to the project accounting records after the reimbursement requests were submitted caused the County to receive more funds than expenditures incurred on specific grants. Documentation of review and approval for reimbursement requests was also not retained. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 004 Cash Management (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-006. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to reimbursement requests and that supporting documentation is retained. Reconciliations should be reviewed and approved by an individual other than the preparer prior to submission, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 004 Cash Management Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038; 24-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.305(b)) requires non-federal entities to minimize the time between drawing and disbursing of federal funds; interest should also be calculated on amounts of unearned revenue. Effective internal controls should include procedures that involve reimbursement requests being reviewed and approved prior to submission. Condition: There were instances in which reimbursement requests did not agree to the County’s accounting records or to the amounts reported on the SEFA. The time between receiving and disbursing federal funds was not minimized, and interest on unearned revenue was not calculated. Furthermore, reimbursement requests were not reviewed and approved prior to submission, and documentation of such review was not retained. Questioned Costs: $132,322 Context: 2 of 8 reimbursement requests tested did not have supporting documentation for the exact amount received. All 8 reimbursement requests tested lacked documentation of review and approval prior to submission. Cause: Supporting documentation for reimbursement requests was not complete; specifically, adjustments made to the project accounting records after the reimbursement requests were submitted caused the County to receive more funds than expenditures incurred on specific grants. Documentation of review and approval for reimbursement requests was also not retained. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 004 Cash Management (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-006. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to reimbursement requests and that supporting documentation is retained. Reconciliations should be reviewed and approved by an individual other than the preparer prior to submission, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 004 Cash Management Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038; 24-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.305(b)) requires non-federal entities to minimize the time between drawing and disbursing of federal funds; interest should also be calculated on amounts of unearned revenue. Effective internal controls should include procedures that involve reimbursement requests being reviewed and approved prior to submission. Condition: There were instances in which reimbursement requests did not agree to the County’s accounting records or to the amounts reported on the SEFA. The time between receiving and disbursing federal funds was not minimized, and interest on unearned revenue was not calculated. Furthermore, reimbursement requests were not reviewed and approved prior to submission, and documentation of such review was not retained. Questioned Costs: $132,322 Context: 2 of 8 reimbursement requests tested did not have supporting documentation for the exact amount received. All 8 reimbursement requests tested lacked documentation of review and approval prior to submission. Cause: Supporting documentation for reimbursement requests was not complete; specifically, adjustments made to the project accounting records after the reimbursement requests were submitted caused the County to receive more funds than expenditures incurred on specific grants. Documentation of review and approval for reimbursement requests was also not retained. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 004 Cash Management (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-006. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to reimbursement requests and that supporting documentation is retained. Reconciliations should be reviewed and approved by an individual other than the preparer prior to submission, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 004 Cash Management Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038; 24-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.305(b)) requires non-federal entities to minimize the time between drawing and disbursing of federal funds; interest should also be calculated on amounts of unearned revenue. Effective internal controls should include procedures that involve reimbursement requests being reviewed and approved prior to submission. Condition: There were instances in which reimbursement requests did not agree to the County’s accounting records or to the amounts reported on the SEFA. The time between receiving and disbursing federal funds was not minimized, and interest on unearned revenue was not calculated. Furthermore, reimbursement requests were not reviewed and approved prior to submission, and documentation of such review was not retained. Questioned Costs: $132,322 Context: 2 of 8 reimbursement requests tested did not have supporting documentation for the exact amount received. All 8 reimbursement requests tested lacked documentation of review and approval prior to submission. Cause: Supporting documentation for reimbursement requests was not complete; specifically, adjustments made to the project accounting records after the reimbursement requests were submitted caused the County to receive more funds than expenditures incurred on specific grants. Documentation of review and approval for reimbursement requests was also not retained. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 004 Cash Management (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-006. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to reimbursement requests and that supporting documentation is retained. Reconciliations should be reviewed and approved by an individual other than the preparer prior to submission, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 004 Cash Management Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-274038; 23-224038; 24-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.305(b)) requires non-federal entities to minimize the time between drawing and disbursing of federal funds; interest should also be calculated on amounts of unearned revenue. Effective internal controls should include procedures that involve reimbursement requests being reviewed and approved prior to submission. Condition: There were instances in which reimbursement requests did not agree to the County’s accounting records or to the amounts reported on the SEFA. The time between receiving and disbursing federal funds was not minimized, and interest on unearned revenue was not calculated. Furthermore, reimbursement requests were not reviewed and approved prior to submission, and documentation of such review was not retained. Questioned Costs: $132,322 Context: 2 of 8 reimbursement requests tested did not have supporting documentation for the exact amount received. All 8 reimbursement requests tested lacked documentation of review and approval prior to submission. Cause: Supporting documentation for reimbursement requests was not complete; specifically, adjustments made to the project accounting records after the reimbursement requests were submitted caused the County to receive more funds than expenditures incurred on specific grants. Documentation of review and approval for reimbursement requests was also not retained. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 004 Cash Management (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-006. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to reimbursement requests and that supporting documentation is retained. Reconciliations should be reviewed and approved by an individual other than the preparer prior to submission, and documentation of such review should be retained. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
2024 – 005 Reporting Federal Agency: U.S. Department of Health and Human Services Federal Program Name: Low-Income Home Energy Assistance Program (LIHEAP) Assistance Listing Number: 93.568 Federal Award Identification Number and Year: G-2302ILLIEA 6/1/2023; G-2302ILLIEA 10/1/2022 Pass-Through Agency: Illinois Department of Commerce and Economic Opportunity Pass-Through Numbers: 23-221038; 23-224038 Award Period: June 1, 2023 through September 30, 2024; October 1, 2022 through August 31, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: Uniform Grant Guidance (2 CFR 200.303) requires non-federal entities receiving federal awards establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Uniform Grant Guidance (2 CFR 200.328 and 2 CFR 200.329)) requires non-federal entities to submit performance and financial reports as required by the pass-through entity award and to ensure that the data accumulated and summarized is in accordance with the required criteria and methodology. Effective internal controls should ensure grant closeout reports are supported by documentation of expenditures that have been incurred. Additionally, grant agreements requiring grant closeout reports should be reconciled to the accounting records. Condition: The County did not retain supporting documentation for closeout performance reports. Accounting records supporting the SEFA did not reconcile to the certified cost reported in the closeout financial reports. There were also instances where federal reimbursements did not align with project accounting code records. Questioned Costs: None Context: 2 of 3 closeout performance reports tested lacked supporting documentation. 2 of 3 closeout financial reports tested did not reconcile to the accounting records supporting the SEFA or to the project accounting code records. Cause: Supporting documentation for closeout performance reports was not retained. Additionally, adjustments made to the project accounting records after submission of the closeout financial reports and reconciliations resulted in discrepancies between reported and actual cost. Effect: Lack of proper documentation and reconciliation can result in over- or under-reimbursement of federal grant funds, potentially leading to noncompliance with federal requirements and potential repayment obligations. Section III – Findings and Questioned Costs – Major Federal Programs (Continued) 2024 – 005 Reporting (Continued) Repeat Finding: The finding is a repeat of a finding in the prior year. The prior year finding number was 2023-007. Recommendation: We recommend that the County design and implement internal controls to ensure accounting records reconcile to grant closeout reports and that supporting documentation is retained. A detailed, documented review of all reports should be conducted by someone other than the preparer to ensure completeness and accuracy. No financial activity should be recorded to the project accounting records after grant closeout reports are completed. Views of Responsible Officials: There is no disagreement with the audit finding.
Subrecipient Monitoring Federal Department – U.S. Department of Justice Pass-through Illinois Criminal Justice Information Authority Federal Award Identification Number and Year: 15JOVW-21-GG-00543-STOP and 2021 15JOVW-22-GG-00422-STOP and 2022 Violence Against Women Formula Grants, Federal Assistance Listing #16.588 County Department – State’s Attorney Office Finding 2024 – 002 CRITERIA 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D—Post Federal Award Requirements Standards for Financial and Program Management, Section 200.303 Internal controls states, “the recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.” Section 200.332. Requirements for pass-through entities, requires that “A pass-through entity must: (c) Evaluate each subrecipient's fraud risk and risk of noncompliance with a subaward to determine the appropriate subrecipient monitoring described in paragraph (f) of this section. When evaluating a subrecipient's risk, a pass-through entity should consider the following: (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits. This includes considering whether or not the subrecipient receives a Single Audit in accordance with subpart F and the extent to which the same or similar subawards have been audited as a major program; (3) Whether the subrecipient has new personnel or new or substantially changed systems; and (4) The extent and results of any Federal agency monitoring (for example, if the subrecipient also receives Federal awards directly from the Federal agency)... (e) Monitor the activities of a subrecipient as necessary to ensure that the subrecipient complies with Federal statutes, regulations, and the terms and conditions of the subaward. The pass-through entity is responsible for monitoring the overall performance of a subrecipient to ensure that the goals and objectives of the subaward are achieved. In monitoring a subrecipient, a pass-through entity must:(1) Review financial and performance reports. (2) Ensure that the subrecipient takes corrective action on all significant developments that negatively affect the subaward. Significant developments include Single Audit findings related to the subaward, other audit findings, site visits, and written notifications from a subrecipient of adverse conditions which will impact their ability to meet the milestones or the objectives of a subaward. When significant developments negatively impact the subaward, a subrecipient must provide the pass-through entity with information on their plan for corrective action and any assistance needed to resolve the situation. (3) Issue a management decision for audit findings pertaining only to the Federal award provided to the subrecipient from the pass-through entity as required by § 200.521.(4)Resolve audit findings specifically related to the subaward…. (g)Verify that a subrecipient is audited as required by subpart F of this part. (h) Consider whether the results of a subrecipient's audit, site visits, or other monitoring necessitate adjustments to the pass-through entity's records. (i) Consider taking enforcement action against noncompliant subrecipients as described in § 200.339 and in program regulations. CONDITION During the current audit period, the Cook County State’s Attorney Office (SAO) did not adequately comply with its subrecipient monitoring requirements as required by Federal regulations. CAUSE Based on discussions with management, the cause of this finding was an inadequate understanding of sub-recipient monitoring policies and best practices. While the Department believed at the time that they were in compliance with the applicable monitoring requirements, they now recognize that their efforts did not fully meet the necessary standards. EFFECT Failure to adequately perform and document the risk assessments on its subrecipient(s) could result in the inadequate monitoring of the activities and performance of a subrecipient. Also, this could result in Federal awards being used by the subrecipient for unauthorized purposes. QUESTIONED COSTS None. CONTEXT During our review of two (2) subrecipients (of a population of 4 subrecipients), we noted the following: For both subrecipients, we noted documentation was not maintained to support SAO’s evaluation of the subrecipients’ risk of noncompliance and the frequency of monitoring to be conducted by SAO based on the assessed risk. We also noted for both subrecipients, no documentation was provided to verify whether the subrecipients were required to have a Single Audit conducted, including SAO’s review of the report, and if applicable, issuance of a management decision on audit findings noted as required by 2 CFR 200.332e(3). The SAO utilized a “Subrecipient Monitoring Checklist” (Checklist) to conduct and document its monitoring of subrecipients. Based on review, we noted the Checklist does not include evidence of who completed the monitoring, the date the actual monitoring was performed nor the subrecipient personnel with whom the monitoring results were discussed during the site visit. Also, the Checklist appears to be inaccurately completed. Specifically, we noted the Checklist noted that the results include expected corrective actions and dates for resolution. However, there was no finding or issues noted in the formal letter submitted to the subrecipient(s) after the site visit(s). IDENTIFICATION OF REPEATED FINDINGS None. RECOMMENDATION We recommend SAO implement procedures to ensure adequate documentation is maintained to support the evaluation of each subrecipient’s risk of noncompliance and review of the Single audit report, as required by Federal regulations. Also, we suggest that the Checklist be accurately prepared and updated to include evidence of who completed the monitoring, the date the actual monitoring was performed, and the subrecipient personnel with whom the monitoring results were discussed during the site visit. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The County agrees with the finding and recommendation. The County’s corrective action plan is on pages 38-39.