2023-101 Lack of Internal Controls over the Application of the Sliding Fee Scale (prior two years 2022-101 and 2021-101) (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 (2022 and 2023), COVID-19 H8G48569 (2023) and COVID-19 ARP H8F40324 (2021) 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. - 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. - 14 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. Four of the sixty encounters were for lab services which were not documented on the billing system and therefore the correct amount of the sliding scale fee could not be determined. 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 six of the encounters above, was due to improper staff training or failure to properly monitor the process. Three of the encounters could not be determined for application of the correct sliding fee scale as lab fees were not documented in the billing system. 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.
2023-001 – REPORTING- ARPA GRANT Type of Finding: (F) –Significant Deficiency in Internal Control Over Compliance of Federal Awards Funding Agency: National Endowment for the Humanities Title: Humanities Councils American Rescue Plan Funding (COVID-19 American Rescue Plan - Promotion of the Humanities - Federal/State Partnership) AL #: 45.129 Award #: ZSO-283159-21 ARP Award Period: November 1, 2021 – April 30, 2023. Questioned Costs: None Statement of Condition NMHC did not have adequate controls over the SF-425. The data in SF-425 financial report for the reporting period end date of April 30, 2023 did not agree to the NMHC’s accounting records. Management’s review of the report did not identify that the amounts reported under line 10(c) (cash on hand) were understated by $35,126 as of April 30, 2023. Additionally, 2 checks with unspent funds were received from subgrantees in the amount of $6,985 after the due date of the report, bringing the total amount to be returned to the grantor to $42,111. (The subrecipients, due to deficiencies in their own internal controls, had attested in writing at the time of the closing of their grants that they had spent their total subawarded ARPA dollars in an appropriate fashion.) Criteria In accordance with 24 CFR Part 85.41, the Federal Financial Report (SF-425) is required to be submitted for the Promotion of the Humanities - Federal/State Partnership (ARP) program. Recipients use the SF-425 as a standardized format to report expenditures under Federal awards, as well as, when applicable, cash status. Recipients are required to report both cash management information on lines 10(a) through 10(c) and financial status information on lines 10(d) through 10(o). In addition, 2 CFR Part 200.303 requires the program to establish and maintain effective internal controls over Federal awards that provides reasonable assurance of compliance with Federal statutes, regulations, and the terms and conditions of Federal awards. Cause NMHC did not properly report cash on hand and the reviewer did not detect these errors or errors in the amounts due to be returned. The grant was not consistently tracked in the accounting system, making it hard to produce meaningful reports that could give accurate numbers for the report. Effect Weaknesses in internal controls related to the reporting requirements could result in sanctions by the National Endowment for the Humanities. Questioned costs are not applicable to this finding. Recommendation NMHC staff should perform more detailed reviews of the reports to ensure they properly reflect grant receipts and expenditures. The accounting records should track all revenue and expenses by grant to be able to perform timely and accurate reconciliation. This review should be performed by someone other than the preparer and should include documented evidence of agreeing the reported data to the accounting records. We further recommend training for those individuals involved in the preparation and review of the reports to ensure they are fully aware of the requirements. View of Responsible Official and Corrective Action Plan: NMHC management will perform more detailed reviews of future SF-425 forms to ensure they accurately reflect grant receipts and expenditures. NMHC ‘s Executive Director has already ensured that accounting records track all revenue and expenses by grant in order to be able to perform timely and accurate reconciliation through more regular reviews. The Executive Director will seek further training to ensure they are fully aware of the requirements. NMHC will quickly return to the National Endowment for the Humanities the understated amount, deemed to be $42,111. The NMHC Financial Officer will amend the current SF-425 for the NEH ARPA grant and the Executive Director will submit it to the NEH Office of Grant Management. Corrective Action Plan Timeline: Management anticipates the above corrective action plan to be fully implemented by July 31, 2024. Designation Of Employee Position Responsible For Meeting Deadline: The Executive Director will be responsible for ensuring implementation.
2023-002 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: For two of the 40 transactions selected for testing, there was no documentation of review and approval of the expenditure for allowability and payment. Questioned Costs: None Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: Internal controls were not operating effectively to ensure the allowability of expenditures. Effect: Expenditures could be made that are not allowable. Identification as a Repeat Finding: Prior Year Finding 2022-002 Recommendation: We recommend that the Council implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-003 REPORTING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.302(b) states that “the financial management system of each non-Federal entity must provide for… accurate, current, and complete disclosure of the financial results of each Federal award or program…” Condition: For both of the SF-425 reports selected for testing, there was no documentation of review and approval of the SF-425 report prior to submission. For one of the SF-425 reports selected for testing, inaccurate data was input and submitted. Questioned Costs: None Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: The Council does not have adequate internal controls and policies and procedures in place to ensure that reports contain accurate financial information and are reviewed before submission. Effect: The Council is not reporting accurate financial information to its federal grantor. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Council implement controls and policies and procedures over financial reporting to ensure compliance with federal reporting requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-004 SEFA REPORTING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.510(b) states that “the auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502.” Condition: The Council’s internal controls are not adequate to ensure the Schedule of Expenditures of Federal Awards (SEFA) accurately reports Federal assistance. The Council’s fiscal year 2023 SEFA for the Promotion of the Humanities Federal/State Partnership program included expenditures from other fiscal years. Questioned Costs: $4,015 Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: The Council does not have adequate internal controls in place to ensure the accuracy of the SEFA. Effect: The Council is not reporting accurate financial information in its SEFA. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Council implement controls over financial reporting, including the SEFA, to ensure accuracy of financial data. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-001 – REPORTING- ARPA GRANT Type of Finding: (F) –Significant Deficiency in Internal Control Over Compliance of Federal Awards Funding Agency: National Endowment for the Humanities Title: Humanities Councils American Rescue Plan Funding (COVID-19 American Rescue Plan - Promotion of the Humanities - Federal/State Partnership) AL #: 45.129 Award #: ZSO-283159-21 ARP Award Period: November 1, 2021 – April 30, 2023. Questioned Costs: None Statement of Condition NMHC did not have adequate controls over the SF-425. The data in SF-425 financial report for the reporting period end date of April 30, 2023 did not agree to the NMHC’s accounting records. Management’s review of the report did not identify that the amounts reported under line 10(c) (cash on hand) were understated by $35,126 as of April 30, 2023. Additionally, 2 checks with unspent funds were received from subgrantees in the amount of $6,985 after the due date of the report, bringing the total amount to be returned to the grantor to $42,111. (The subrecipients, due to deficiencies in their own internal controls, had attested in writing at the time of the closing of their grants that they had spent their total subawarded ARPA dollars in an appropriate fashion.) Criteria In accordance with 24 CFR Part 85.41, the Federal Financial Report (SF-425) is required to be submitted for the Promotion of the Humanities - Federal/State Partnership (ARP) program. Recipients use the SF-425 as a standardized format to report expenditures under Federal awards, as well as, when applicable, cash status. Recipients are required to report both cash management information on lines 10(a) through 10(c) and financial status information on lines 10(d) through 10(o). In addition, 2 CFR Part 200.303 requires the program to establish and maintain effective internal controls over Federal awards that provides reasonable assurance of compliance with Federal statutes, regulations, and the terms and conditions of Federal awards. Cause NMHC did not properly report cash on hand and the reviewer did not detect these errors or errors in the amounts due to be returned. The grant was not consistently tracked in the accounting system, making it hard to produce meaningful reports that could give accurate numbers for the report. Effect Weaknesses in internal controls related to the reporting requirements could result in sanctions by the National Endowment for the Humanities. Questioned costs are not applicable to this finding. Recommendation NMHC staff should perform more detailed reviews of the reports to ensure they properly reflect grant receipts and expenditures. The accounting records should track all revenue and expenses by grant to be able to perform timely and accurate reconciliation. This review should be performed by someone other than the preparer and should include documented evidence of agreeing the reported data to the accounting records. We further recommend training for those individuals involved in the preparation and review of the reports to ensure they are fully aware of the requirements. View of Responsible Official and Corrective Action Plan: NMHC management will perform more detailed reviews of future SF-425 forms to ensure they accurately reflect grant receipts and expenditures. NMHC ‘s Executive Director has already ensured that accounting records track all revenue and expenses by grant in order to be able to perform timely and accurate reconciliation through more regular reviews. The Executive Director will seek further training to ensure they are fully aware of the requirements. NMHC will quickly return to the National Endowment for the Humanities the understated amount, deemed to be $42,111. The NMHC Financial Officer will amend the current SF-425 for the NEH ARPA grant and the Executive Director will submit it to the NEH Office of Grant Management. Corrective Action Plan Timeline: Management anticipates the above corrective action plan to be fully implemented by July 31, 2024. Designation Of Employee Position Responsible For Meeting Deadline: The Executive Director will be responsible for ensuring implementation.
2023-002 ALLOWABILITY Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Condition: For two of the 40 transactions selected for testing, there was no documentation of review and approval of the expenditure for allowability and payment. Questioned Costs: None Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: Internal controls were not operating effectively to ensure the allowability of expenditures. Effect: Expenditures could be made that are not allowable. Identification as a Repeat Finding: Prior Year Finding 2022-002 Recommendation: We recommend that the Council implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-003 REPORTING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.302(b) states that “the financial management system of each non-Federal entity must provide for… accurate, current, and complete disclosure of the financial results of each Federal award or program…” Condition: For both of the SF-425 reports selected for testing, there was no documentation of review and approval of the SF-425 report prior to submission. For one of the SF-425 reports selected for testing, inaccurate data was input and submitted. Questioned Costs: None Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: The Council does not have adequate internal controls and policies and procedures in place to ensure that reports contain accurate financial information and are reviewed before submission. Effect: The Council is not reporting accurate financial information to its federal grantor. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Council implement controls and policies and procedures over financial reporting to ensure compliance with federal reporting requirements. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-004 SEFA REPORTING Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number National Endowment for the Humanities Promotion of the Humanities Federal/State Partnership Grant Number: SO-289836-23 45.129 Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.510(b) states that “the auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee’s financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502.” Condition: The Council’s internal controls are not adequate to ensure the Schedule of Expenditures of Federal Awards (SEFA) accurately reports Federal assistance. The Council’s fiscal year 2023 SEFA for the Promotion of the Humanities Federal/State Partnership program included expenditures from other fiscal years. Questioned Costs: $4,015 Context: Total federal expenditures for the Promotion of the Humanities Federal/State Partnership program were $1,019,055 for the year ended October 31, 2023. Cause: The Council does not have adequate internal controls in place to ensure the accuracy of the SEFA. Effect: The Council is not reporting accurate financial information in its SEFA. Identification as a Repeat Finding: This is not a repeat finding from the prior year. Recommendation: We recommend that the Council implement controls over financial reporting, including the SEFA, to ensure accuracy of financial data. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2023-001 – Internal Control over Compliance and Compliance with Activities Allowed or Unallowed and Allowable Costs/Cost Principles Information on Federal Program(s) - Department of Education Assistance Listing Number: 84.351 Assistance Listing Name: Arts in Education National Program Grant Award Numbers: S351A220007 Award Period: October 1, 2022 to September 30, 2023 Criteria or Specific Requirement – The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In addition, per 2 CFR Section 200.403, “Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federallyfinanced program in either the current or a prior period. (g) Be adequately documented. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3).” Condition – In evaluating the Center’s compliance with the requirements of Activities Allowed or Unallowed and Allowable Costs Cost Principles, our test work identified two instances out of a sample of sixty payroll transactions, totaling $41,872.98, in which employees were not paid according to their contract. For the two exceptions, the employees were underpaid a total of $1.48. Cause – The Center did not adhere to their internal process to ensure approved salary information was accurately applied. Effect or Potential Effect – Without adequate internal controls in place to ensure costs are properly verified and applied, the Center could inaccurately charge expenditures to the federal program. Questioned Costs – N/A Context – This is a condition based on testing of the Center’s compliance. Based on tested samples, we noted a total underpayment of $1.48. The prevalence of the finding is detailed in the condition section above. The samples were selected using a non-statistical method. Repeat Finding – This is a repeat finding from prior year. While the prior year finding resulted in a net overpayment and current year finding resulted in a net underpayment, the fact that management is not adhering to their internal control processes requires this finding to be considered a repeat finding. This was reported as finding 2022-002 in the 2022 report. Recommendation - We recommend management ensure the Center strengthen their internal process to ensure that employee salary information recorded in the payroll system are approved, supported by salary documentation in the personnel files, and accurately applied. Views of Responsible Officials – After performing a detailed analysis, the Center’s management identified that the likely net underpayment amounted to $111.52, while the likely net overpayment was $83.20. The likely underpayment and overpayment were determined by management through examination of the total salary charged to the federal program. The Center’s management agrees with the finding and will strengthen the internal process surrounding the activities allowed or unallowed and allowable costs and will ensure adequate documentation is in place and approved salary rates are consistently and properly applied. See the Center’s corrective action for more details.
2023-001 – Internal Control over Compliance and Compliance with Activities Allowed or Unallowed and Allowable Costs/Cost Principles Information on Federal Program(s) - Department of Education Assistance Listing Number: 84.351 Assistance Listing Name: Arts in Education National Program Grant Award Numbers: S351A220007 Award Period: October 1, 2022 to September 30, 2023 Criteria or Specific Requirement – The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. In addition, per 2 CFR Section 200.403, “Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federallyfinanced program in either the current or a prior period. (g) Be adequately documented. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to § 200.308(e)(3).” Condition – In evaluating the Center’s compliance with the requirements of Activities Allowed or Unallowed and Allowable Costs Cost Principles, our test work identified two instances out of a sample of sixty payroll transactions, totaling $41,872.98, in which employees were not paid according to their contract. For the two exceptions, the employees were underpaid a total of $1.48. Cause – The Center did not adhere to their internal process to ensure approved salary information was accurately applied. Effect or Potential Effect – Without adequate internal controls in place to ensure costs are properly verified and applied, the Center could inaccurately charge expenditures to the federal program. Questioned Costs – N/A Context – This is a condition based on testing of the Center’s compliance. Based on tested samples, we noted a total underpayment of $1.48. The prevalence of the finding is detailed in the condition section above. The samples were selected using a non-statistical method. Repeat Finding – This is a repeat finding from prior year. While the prior year finding resulted in a net overpayment and current year finding resulted in a net underpayment, the fact that management is not adhering to their internal control processes requires this finding to be considered a repeat finding. This was reported as finding 2022-002 in the 2022 report. Recommendation - We recommend management ensure the Center strengthen their internal process to ensure that employee salary information recorded in the payroll system are approved, supported by salary documentation in the personnel files, and accurately applied. Views of Responsible Officials – After performing a detailed analysis, the Center’s management identified that the likely net underpayment amounted to $111.52, while the likely net overpayment was $83.20. The likely underpayment and overpayment were determined by management through examination of the total salary charged to the federal program. The Center’s management agrees with the finding and will strengthen the internal process surrounding the activities allowed or unallowed and allowable costs and will ensure adequate documentation is in place and approved salary rates are consistently and properly applied. See the Center’s corrective action for more details.
Condition: Texas Guaranteed Student Loan Corporation d/b/a Trellis Company (Trellis) as a guarantor works with borrowers who qualify for the teacher loan forgiveness program. Quarterly, Trellis will perform a quality review of five applications to verify the applicant was eligible for forgiveness. During fiscal year 2023, the quarterly review process was not completed from October through August. In addition, Trellis did not have a compensating control in place to monitor the completeness and accuracy of the teacher loan forgiveness process. When brought to the attention of management, Trellis performed the quarterly reviews for fiscal year 2023 in arrears prior to yearend. To verify remediation efforts, two quarters were sampled with no exceptions noted. Criteria or Requirement: 2 CFR 200.303 requires non-Federal entities receiving Federal awards to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include procedures to ensure teacher loan forgiveness applications are processed correctly. Cause: Trellis opted to not perform the quarterly quality review process over teacher loan forgiveness claims as the volume of loans has continued to decline over the last few years, there were no errors noted in prior quarterly reviews, and the personnel performing the processes remained consistent. Possible Asserted Effect: Trellis could have approved a teacher loan forgiveness application that was not eligible. Repeat Finding: A similar finding was not reported in the prior year audit. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: Trellis should reinstitute the quality control process. Views of Trellis Officials: Trellis agrees with this recommendation. Trellis reinstituted in arrears for fiscal year 2023 and is currently performing the quality reviews as described above for fiscal year 2023.
Total Unused Lost Revenues Reporting Federal program: U.S. Department of Health and Human Services – ALN 93.498, COVID-19—Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution. Criteria: 2 CFR Part 200.303(a) states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and terms and conditions of the federal award. Specific criteria are established by the U.S. Department of Health and Human Services (HHS) with respect to allowable cost and reporting requirements for this program, including: - Funds shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus. - Entities may elect to calculate and report lost revenue using one of three options. For entities electing to report lost revenues using Option i, quarterly actual patient care revenues are to be reported. Condition: In preparing the Reporting Period 4 and 5 General Distribution submission report to Health Resources & Services Administration (HRSA), the Corporation did not reduce the Unused Lost Revenues included within the ARP Distribution submission report from the Unused Lost Revenues in the General Distribution report in the Current Reporting Period. This resulted in the Total Unused Lost Revenues in the Reporting Period 4 and 5 General Distribution submission reports to be overstated by $723,754. Context: The Corporation reported Total Unused Lost Revenues in the Reporting Period 4 and 5 General Distribution submission reports of $42,297,586 and $42,276,693. Had the correct amounts of Total Unused Lost Revenues in the Reporting Period 4 and 5 General Distribution submission reports been reported, the Total Unused Lost Revenues would have been $723,754 less. The Total Unused Lost Revenues would still have exceeded PRF amounts received. Cause: In preparing the Reporting Period 4 and 5 General Distribution submission report to Health Resources & Services Administration (HRSA), the Corporation did not reduce the Unused Lost Revenues included within the ARP Distribution submission report from the Unused Lost Revenues in the General Distribution report in the Current Reporting Period. This resulted in the Total Unused Lost Revenues in the Reporting Period 4 and 5 General Distribution submission reports to be overstated by $723,754. Review processes were performed before the reports were submitted, but these reviews were not effective in detecting and correcting the errors before report submission. Effect: The Total Unused Lost Revenues in the Reporting Period 4 and 5 General Distribution submission reports were overstated by $723,754. Questioned costs: None Repeat finding: No Recommendation: We recommend that internal controls be strengthened related to review of the quarterly lost revenue calculations and reporting in the PRF reporting portal. We suggest these reviews include review of documentation supporting input included in the report. View of responsible officials of the auditee: Management agrees with the finding, has prepared an assessment of the root cause of this significant deficiency, and has developed a corrective action plan.
Information on the Federal Program: Assistance Listing Number 10.565—Commodity Supplemental Food Program, U.S. Department of Agriculture. Pass-Through Entities and Award Numbers: Minnesota Department of Health, award number 204642. Compliance Requirement: Allowable Costs. Type of Finding: Significant deficiency in internal control over compliance. Criteria: 2 CFR 200.303 of Subpart D, "Post Federal Award Requirements Standards for Financial and Program Management," of the Uniform Guidance requires a nonfederal entity to establish and maintain effective internal control over the federal award that provides reasonable assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award, including Activities Allowed or Unallowed, Allowable Costs and Cost Principles. Condition: Controls were not operating to ensure that CSFP box sign out signatures were properly reviewed and tracked against reported totals. Cause: One monthly signature log for a CSFP distribution site had fewer signatures on their box sign out sheet than were reported on the signature log cover sheet. These should never be different, as the log cover sheet should be a representation of the number of signatures in the sign out sheet. The site representative responsible for ensuring these amounts agree did not perform the designed control. Effect or Potential Effect: Unallowable costs or activities could be charged to the grant. Questioned Costs: None Context: The number of boxes distributed reported on the summary signature log did not agree to the supporting signature detail. Repeat Finding: No Recommendation: We recommend a separate review of signature log cover sheets be documented by an agent independent of the distribution site. Views of Responsible Officials: Agree and controls have been implemented.
Information on the Federal Program: Assistance Listing Number 10.565—Commodity Supplemental Food Program, U.S. Department of Agriculture. Pass-Through Entities and Award Numbers: Minnesota Department of Health, award number 204642. Compliance Requirement: Eligibility. Type of Finding: Significant deficiency in internal control over compliance. Criteria: 2 CFR 200.303 of Subpart D, "Post Federal Award Requirements Standards for Financial and Program Management," of the Uniform Guidance requires a nonfederal entity to establish and maintain effective internal control over the federal award that provides reasonable assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award, including Eligibility. Condition: Controls were not operating effectively over CSFP eligibility. Cause: Some signed enrollment forms for CSFP participants detailing eligibility status were not available upon request. The signatures present on these forms indicate the performance of the review control being performed by Second Harvest Heartland personnel. They should confirm all the information included on the form to be correct. Effect or Potential Effect: An ineligible individual could receive a CSFP box. Questioned Costs: None Context: Signed enrollment forms were not available for two of forty participants selected. Repeat Finding: No Recommendation: We recommend that Second Harvest Heartland digitalize their CSFP enrollment forms for convenient access and so that every form is reviewed for signatures during their upload. Views of Responsible Officials: Agree.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Department of Health and Human Services Temporary Assistance for Needy Families, 93.558 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards under assistance listing 93.558 on the Consolidated Schedule of Expenditures of Federal Awards Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: There was no evidence of review and approval prior to submission of the six programmatic reports selected for testing. Cause: Goodwill-Easter Seals Minnesota has a review process in place but was not formally documented. Effect: Failure to perform an independent review of reporting could result in a reasonable possibility that Goodwill-Easter Seals Minnesota would not detect errors in the normal course of performing duties and correct them in a timely manner. Questioned Costs: None reported. Context/Sampling: Six programmatic reporting submissions out of eighteen total reports were selected for testing the program. Repeat Finding from Prior Year: No Recommendation: We recommend that management develop a formal documented review over reporting and that documentation is retained to support compliance with program requirements. Views of Responsible Officials: Management agrees with this finding.
Finding No: 2023-001 Activities Allowed or Unallowed/Allowable Costs Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.498 Program: COVID -19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Award Year: January 1, 2020 through December 31, 2022 (a) Criteria or Requirement The specific requirements for activities allowed or unallowed are unique to each federal program and are found in the federal statutes, regulations, and the terms and conditions of the federal award pertaining to the program. This program allows expenditures to prevent, prepare for, and respond to coronavirus and COVID-19, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Per 2 CFR 200.303, a non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) Condition Found, Including Perspective During our test work, we selected a sample of 60 non-payroll disbursements made during the fiscal year 2023 reporting period. We noted eight instances totaling $1,717 in which expenditures were approved for payment based on vendor invoices which included inaccurate calculations. In addition, we noted three instances of duplicate expenditures totaling $38,971 being transferred and charged to the program. Lastly, the University was unable to provide supporting documentation and evidence of the effective operation of the management review control for one of the 60 disbursements sampled totaling $803. (c) Possible Cause The University has a management review process to review invoices and related documentation before payments are disbursed. The University management review control that was in place did not operate effectively to prevent duplicate charges, inaccurate amounts and charges that lacked supporting documentation from being submitted for reimbursement by the federal agency. (d) Questioned Cost Duplicate expenditures totaling $38,971 and payment of inaccurate vendor invoices totaling $1,717. (e) Effect Federal funds were expended for duplicated or inaccurate amounts and supporting documentation and evidence of the effective operation of management review controls were not consistently maintained in accordance with Federal requirements. (f) Statistical Validity The sample was not intended to be, and was not, a statistically valid sample. (g) Repeat Finding in the Prior Year This finding also occurred in the prior year listed as Finding No. 2022-001. (h) Recommendation We recommend that the University strengthen controls over the management review process to prevent duplicate and inaccurate amounts from being charged to Federal programs and to enhance the retention of supporting documentation and evidence of management review and approval. (i) View of Responsible Officials Management concurs with the finding. While appropriate controls exist relative to management review and recalculation of expenditures, opportunities exist to retrain staff and further enhance controls related to procedures for submission, review, and approval of contract labor invoices. Specific instructions to recalculate each contract employees’ timesheet(s) and agree the totals to the related invoice prior to approval were distributed and outlined for department managers, accountants, and accounts payable staff. In addition, the process for reviewing and approving grant expenditures has since been enhanced subsequent to manager turnover during the fiscal year. Specifically, employees responsible for processing grant transfer documentation will ensure documents contain management approval(s), grants and contracts accounting approval, and appropriate documentation prior to keying and uploading documentation into the general ledger. The new practice will help compensate for employee turnover as documentation of historical review will be available to successors.
Finding No: 2023-002 Special Tests and Provisions - Enrollment Reporting Federal Agency: U.S. Department of Education Assistance Listing Number: 84.268 and 84.063 Program: Federal Direct Student Loan Program and Federal Pell Grant Program Award Year: July 1, 2022 through June 30, 2023 (a) Criteria or Requirement Institutions are required to report enrollment information under the Federal Pell Grant Program, the Federal Direct Student Loan Program and the Federal Family Education Loan Program, via the National Student Loan Data System (NSLDS) in accordance with 34 CFR 690.83(b)(2); 34 CFR 682.610; and 34 CFR 685.309. Per 2 CFR 200.303, a non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) Condition Found, Including Perspective During our enrollment reporting test work, we selected for testing a sample of 60 students awarded and disbursed Federal Pell Program (Pell) funds and/or Federal Direct Student Loan Program (Direct Loans) funds that had an enrollment change (i.e., dropped, withdrawn, or graduated) during fiscal year 2023. We noted one instance in which the student’s status change was submitted to the National Student Clearinghouse (NSC) and was subsequently rejected by the NSC due to inconsistent data related to the student’s social security number. The rejection of this student’s status change was included on an NSC Reject Detail Report for Fall 2022 through Fall 2023 and was not timely resolved and resubmitted by the University. As a result, we reviewed the cumulative NSC Reject Detail Report as of September 30, 2023 and noted 66 students with 132 instances of enrollment status rejections due to inconsistent data primarily related to social security numbers that had not been timely resolved and resubmitted. In addition, we noted one student selected for testing that was reported late to the NSLDS via the NSC due to management not maintaining a schedule to report every 60 days. As a result, we reviewed the enrollment report that included the student selected and identified an additional 60 students included on that enrollment report having an enrollment change that was reported late by the University (i.e,. outside of the 60-day period). For perspective, 10,058 students received Pell program funds and/or Direct Loan program funds during the 2022-2023 academic year. (c) Possible Cause The University's Registrar Office has a review process in place to review the NSC Reject Detail Report following the submission and processing of enrollment files to the NSC's website. However, the University does not reach out to the student to obtain verification or additional information to correct NSC rejections identified in the report that are related to social security number errors (i.e., NSC error code 290). The University's Registrar Office also has a process in place to maintain a transmission schedule on the NSC secure site. The schedule is set to report student enrollment status changes approximately 4 times each semester: 1) early registration is sent approximately one week before the start of the term; 2) first of term report is sent the day after Student Accounting cancels classes; 3) mid-term report is sent 45-60 days after the first of term submission; and 4) end of term transmission is sent within 60 days of the mid-term submission. An additional report is sent the next working day after the end of the add-back period for graduating students for degree verification, which is usually the last day before the start of the next term. As the student status change enrollment reports are not on a consistent reporting schedule to be submitted to the NSLDS via the NSC every 60 days, instances of untimely reporting of student enrollment status changes occurred. (d) Questioned Cost None reportable. (e) Effect As a result of management not resolving the student rejections on the NSC Reject Detail Report, the NSLDS was not notified of the student’s enrollment status change by the NSC as required. In addition, as a result of management not maintaining a consistent enrollment reporting schedule every 60 days, untimely reporting of students’ enrollment status changes to the NSLDS via the NSC occurred. (f) Statistical Validity The sample was not intended to be, and was not, a statistically valid sample. (g) Repeat Finding in the Prior Year This finding is not a repeat finding. (h) Recommendation We recommend the University design a process and implement effective controls over the management review process of the NSC Reject Detail Report to prevent untimely resolution of all enrollment status change notification rejected by the NSC. We also recommend that the University Registrar's Office submit student status enrollment changes every 60 days based on the date the enrollment file was submitted, rather than the date the enrollment file was processed, to ensure timely reporting to the NSLDS via the NSC. (i) View of Responsible Officials Management concurs with the finding. The University Registrar will review the NSC Reject Detail Report every 45 days and will use the NSC error description resources to resolve any errors noted. In addition, the University Registrar's Office will submit student status enrollment changes every 30 days based on the date the enrollment file was submitted.
Finding No: 2023-002 Special Tests and Provisions - Enrollment Reporting Federal Agency: U.S. Department of Education Assistance Listing Number: 84.268 and 84.063 Program: Federal Direct Student Loan Program and Federal Pell Grant Program Award Year: July 1, 2022 through June 30, 2023 (a) Criteria or Requirement Institutions are required to report enrollment information under the Federal Pell Grant Program, the Federal Direct Student Loan Program and the Federal Family Education Loan Program, via the National Student Loan Data System (NSLDS) in accordance with 34 CFR 690.83(b)(2); 34 CFR 682.610; and 34 CFR 685.309. Per 2 CFR 200.303, a non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. (b) Condition Found, Including Perspective During our enrollment reporting test work, we selected for testing a sample of 60 students awarded and disbursed Federal Pell Program (Pell) funds and/or Federal Direct Student Loan Program (Direct Loans) funds that had an enrollment change (i.e., dropped, withdrawn, or graduated) during fiscal year 2023. We noted one instance in which the student’s status change was submitted to the National Student Clearinghouse (NSC) and was subsequently rejected by the NSC due to inconsistent data related to the student’s social security number. The rejection of this student’s status change was included on an NSC Reject Detail Report for Fall 2022 through Fall 2023 and was not timely resolved and resubmitted by the University. As a result, we reviewed the cumulative NSC Reject Detail Report as of September 30, 2023 and noted 66 students with 132 instances of enrollment status rejections due to inconsistent data primarily related to social security numbers that had not been timely resolved and resubmitted. In addition, we noted one student selected for testing that was reported late to the NSLDS via the NSC due to management not maintaining a schedule to report every 60 days. As a result, we reviewed the enrollment report that included the student selected and identified an additional 60 students included on that enrollment report having an enrollment change that was reported late by the University (i.e,. outside of the 60-day period). For perspective, 10,058 students received Pell program funds and/or Direct Loan program funds during the 2022-2023 academic year. (c) Possible Cause The University's Registrar Office has a review process in place to review the NSC Reject Detail Report following the submission and processing of enrollment files to the NSC's website. However, the University does not reach out to the student to obtain verification or additional information to correct NSC rejections identified in the report that are related to social security number errors (i.e., NSC error code 290). The University's Registrar Office also has a process in place to maintain a transmission schedule on the NSC secure site. The schedule is set to report student enrollment status changes approximately 4 times each semester: 1) early registration is sent approximately one week before the start of the term; 2) first of term report is sent the day after Student Accounting cancels classes; 3) mid-term report is sent 45-60 days after the first of term submission; and 4) end of term transmission is sent within 60 days of the mid-term submission. An additional report is sent the next working day after the end of the add-back period for graduating students for degree verification, which is usually the last day before the start of the next term. As the student status change enrollment reports are not on a consistent reporting schedule to be submitted to the NSLDS via the NSC every 60 days, instances of untimely reporting of student enrollment status changes occurred. (d) Questioned Cost None reportable. (e) Effect As a result of management not resolving the student rejections on the NSC Reject Detail Report, the NSLDS was not notified of the student’s enrollment status change by the NSC as required. In addition, as a result of management not maintaining a consistent enrollment reporting schedule every 60 days, untimely reporting of students’ enrollment status changes to the NSLDS via the NSC occurred. (f) Statistical Validity The sample was not intended to be, and was not, a statistically valid sample. (g) Repeat Finding in the Prior Year This finding is not a repeat finding. (h) Recommendation We recommend the University design a process and implement effective controls over the management review process of the NSC Reject Detail Report to prevent untimely resolution of all enrollment status change notification rejected by the NSC. We also recommend that the University Registrar's Office submit student status enrollment changes every 60 days based on the date the enrollment file was submitted, rather than the date the enrollment file was processed, to ensure timely reporting to the NSLDS via the NSC. (i) View of Responsible Officials Management concurs with the finding. The University Registrar will review the NSC Reject Detail Report every 45 days and will use the NSC error description resources to resolve any errors noted. In addition, the University Registrar's Office will submit student status enrollment changes every 30 days based on the date the enrollment file was submitted.
TRIO Cluster ‐ Assistance Listing # 84.042, 84.044, 84.047 U.S. Department of Education Federal Assistance Identification Number – P042A2A200272, P044A210475, P047A220386 Federal Award Year ‐ 2022 Criteria – As specified in 2 CFR section 200.303 the non‐Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐ Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Adequate controls must be in place to ensure that expenditures are properly authorized and allowable under program guidelines and are reported in the applicable reporting periods. Condition – The College’s internal control over compliance with allowable costs and activities requires that the terms of employment in the program be documented in an executed contract which details the terms of the employment. This control was not consistently adhered to for all employees. Cause – We noted three instances in a sample of sixteen employees in which an executed employment contract was not obtained to document the terms and approval of the employment under the program. Effect – Failure to follow the College’s policy of obtaining an executed contract for each employee under the program could result in disallowed costs. Questioned Costs – Not determinable. Recommendation – We recommend that the College strictly adhere to its policy of obtaining executed contracts for all employed under the program to ensure there is evidence of review and approval of employee contracts prior to payment. Management’s Response – The College will put into place controls that will provide assurance of proper review and approval of contracts for employees payroll disbursements prior to payment. The Dean of Business Affairs will be responsible for this corrective action and anticipates completion of corrective action will be taken before February 29, 2024.
TRIO Cluster ‐ Assistance Listing # 84.042, 84.044, 84.047 U.S. Department of Education Federal Assistance Identification Number – P042A2A200272, P044A210475, P047A220386 Federal Award Year ‐ 2022 Criteria – As specified in 2 CFR section 200.303 the non‐Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐ Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Adequate controls must be in place to ensure that expenditures are properly authorized and allowable under program guidelines and are reported in the applicable reporting periods. Condition – The College’s internal control over compliance with allowable costs and activities requires that the terms of employment in the program be documented in an executed contract which details the terms of the employment. This control was not consistently adhered to for all employees. Cause – We noted three instances in a sample of sixteen employees in which an executed employment contract was not obtained to document the terms and approval of the employment under the program. Effect – Failure to follow the College’s policy of obtaining an executed contract for each employee under the program could result in disallowed costs. Questioned Costs – Not determinable. Recommendation – We recommend that the College strictly adhere to its policy of obtaining executed contracts for all employed under the program to ensure there is evidence of review and approval of employee contracts prior to payment. Management’s Response – The College will put into place controls that will provide assurance of proper review and approval of contracts for employees payroll disbursements prior to payment. The Dean of Business Affairs will be responsible for this corrective action and anticipates completion of corrective action will be taken before February 29, 2024.
TRIO Cluster ‐ Assistance Listing # 84.042, 84.044, 84.047 U.S. Department of Education Federal Assistance Identification Number – P042A2A200272, P044A210475, P047A220386 Federal Award Year ‐ 2022 Criteria – As specified in 2 CFR section 200.303 the non‐Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐ Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Adequate controls must be in place to ensure that expenditures are properly authorized and allowable under program guidelines and are reported in the applicable reporting periods. Condition – The College’s internal control over compliance with allowable costs and activities requires that the terms of employment in the program be documented in an executed contract which details the terms of the employment. This control was not consistently adhered to for all employees. Cause – We noted three instances in a sample of sixteen employees in which an executed employment contract was not obtained to document the terms and approval of the employment under the program. Effect – Failure to follow the College’s policy of obtaining an executed contract for each employee under the program could result in disallowed costs. Questioned Costs – Not determinable. Recommendation – We recommend that the College strictly adhere to its policy of obtaining executed contracts for all employed under the program to ensure there is evidence of review and approval of employee contracts prior to payment. Management’s Response – The College will put into place controls that will provide assurance of proper review and approval of contracts for employees payroll disbursements prior to payment. The Dean of Business Affairs will be responsible for this corrective action and anticipates completion of corrective action will be taken before February 29, 2024.
Section III - Federal Award Findings and Questioned Costs Significant deficiency in internal controls over eligibility requirements. Federal Agency: United States Department of Labor AL Number/Title: 17.235/Senior Community Services Employment Program Pass-Through Entity: Goodwill Industries International Award Numbers: AD-33650-19-60-A24; AD-35214-20-60-A-24; 23A60AD000034-01-00; YF-39532-23-60-A-24 Criteria Per the standards contained in Title 2 US Code of Federal Regulations (CFR) Uniform Administrative Requirements, Cost Principles and Audit Requirement for Federal Awards, Subpart D ‐ Post Federal Award Requirements, Section 200.303, non‐federal entities are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Federal awards referenced require that eligible participants’ household earnings do not exceed specific income thresholds as outlined in Title 20 CFR, Section 641.500 and that participant eligibility is redetermined on an annual basis in accordance with Title 20 CFR Section 641.505. Condition/Context for Evaluation The Organization's internal compliance controls require that each participant’s household income is certified prior to admission to the program and then recertified annually thereafter in accordance with Title 20 CFR, Section 641.505. During testing for the year ended September 30, 2023, we noted that for two of the thirteen participants selected, while initial income certifications were performed, controls did not operate effectively to ensure the annual recertifications for the period under audit occurred. Eight of the thirteen selections required an annual recertification procedure. Questioned Costs Not applicable. Effect or Potential Effect Eligibility determinations were not completed in accordance with the requirements of the Federal awards. Cause The Organization’s internal controls over compliance did not operate effectively to recertify accurate eligibility determinations for participants. Repeat Finding Not applicable as no similar finding was noted in the prior year audit of the Organization.
Section III - Federal Award Findings and Questioned Costs Significant deficiency in internal controls over eligibility requirements. Federal Agency: United States Department of Labor AL Number/Title: 17.235/Senior Community Services Employment Program Pass-Through Entity: Goodwill Industries International Award Numbers: AD-33650-19-60-A24; AD-35214-20-60-A-24; 23A60AD000034-01-00; YF-39532-23-60-A-24 Criteria Per the standards contained in Title 2 US Code of Federal Regulations (CFR) Uniform Administrative Requirements, Cost Principles and Audit Requirement for Federal Awards, Subpart D ‐ Post Federal Award Requirements, Section 200.303, non‐federal entities are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Federal awards referenced require that eligible participants’ household earnings do not exceed specific income thresholds as outlined in Title 20 CFR, Section 641.500 and that participant eligibility is redetermined on an annual basis in accordance with Title 20 CFR Section 641.505. Condition/Context for Evaluation The Organization's internal compliance controls require that each participant’s household income is certified prior to admission to the program and then recertified annually thereafter in accordance with Title 20 CFR, Section 641.505. During testing for the year ended September 30, 2023, we noted that for two of the thirteen participants selected, while initial income certifications were performed, controls did not operate effectively to ensure the annual recertifications for the period under audit occurred. Eight of the thirteen selections required an annual recertification procedure. Questioned Costs Not applicable. Effect or Potential Effect Eligibility determinations were not completed in accordance with the requirements of the Federal awards. Cause The Organization’s internal controls over compliance did not operate effectively to recertify accurate eligibility determinations for participants. Repeat Finding Not applicable as no similar finding was noted in the prior year audit of the Organization.
Section III - Federal Award Findings and Questioned Costs Significant deficiency in internal controls over eligibility requirements. Federal Agency: United States Department of Labor AL Number/Title: 17.235/Senior Community Services Employment Program Pass-Through Entity: Goodwill Industries International Award Numbers: AD-33650-19-60-A24; AD-35214-20-60-A-24; 23A60AD000034-01-00; YF-39532-23-60-A-24 Criteria Per the standards contained in Title 2 US Code of Federal Regulations (CFR) Uniform Administrative Requirements, Cost Principles and Audit Requirement for Federal Awards, Subpart D ‐ Post Federal Award Requirements, Section 200.303, non‐federal entities are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Federal awards referenced require that eligible participants’ household earnings do not exceed specific income thresholds as outlined in Title 20 CFR, Section 641.500 and that participant eligibility is redetermined on an annual basis in accordance with Title 20 CFR Section 641.505. Condition/Context for Evaluation The Organization's internal compliance controls require that each participant’s household income is certified prior to admission to the program and then recertified annually thereafter in accordance with Title 20 CFR, Section 641.505. During testing for the year ended September 30, 2023, we noted that for two of the thirteen participants selected, while initial income certifications were performed, controls did not operate effectively to ensure the annual recertifications for the period under audit occurred. Eight of the thirteen selections required an annual recertification procedure. Questioned Costs Not applicable. Effect or Potential Effect Eligibility determinations were not completed in accordance with the requirements of the Federal awards. Cause The Organization’s internal controls over compliance did not operate effectively to recertify accurate eligibility determinations for participants. Repeat Finding Not applicable as no similar finding was noted in the prior year audit of the Organization.
Section III - Federal Award Findings and Questioned Costs Significant deficiency in internal controls over eligibility requirements. Federal Agency: United States Department of Labor AL Number/Title: 17.235/Senior Community Services Employment Program Pass-Through Entity: Goodwill Industries International Award Numbers: AD-33650-19-60-A24; AD-35214-20-60-A-24; 23A60AD000034-01-00; YF-39532-23-60-A-24 Criteria Per the standards contained in Title 2 US Code of Federal Regulations (CFR) Uniform Administrative Requirements, Cost Principles and Audit Requirement for Federal Awards, Subpart D ‐ Post Federal Award Requirements, Section 200.303, non‐federal entities are required to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. The Federal awards referenced require that eligible participants’ household earnings do not exceed specific income thresholds as outlined in Title 20 CFR, Section 641.500 and that participant eligibility is redetermined on an annual basis in accordance with Title 20 CFR Section 641.505. Condition/Context for Evaluation The Organization's internal compliance controls require that each participant’s household income is certified prior to admission to the program and then recertified annually thereafter in accordance with Title 20 CFR, Section 641.505. During testing for the year ended September 30, 2023, we noted that for two of the thirteen participants selected, while initial income certifications were performed, controls did not operate effectively to ensure the annual recertifications for the period under audit occurred. Eight of the thirteen selections required an annual recertification procedure. Questioned Costs Not applicable. Effect or Potential Effect Eligibility determinations were not completed in accordance with the requirements of the Federal awards. Cause The Organization’s internal controls over compliance did not operate effectively to recertify accurate eligibility determinations for participants. Repeat Finding Not applicable as no similar finding was noted in the prior year audit of the Organization.
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Period 4 TIN #411271856 Activities Allowed or Unallowed and Allowable Costs/Costs Principles Material Weakness in Internal Control Over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Organization selected option iii to calculate lost revenue, which consists of utilizing an alternative reasonable method. Condition: The Organization selected option iii to calculate lost revenue using budgeted net revenues to actual net revenues. The Organization utilized net revenues for part of the calculation and then utilized gross revenues in later quarters. This inconsistency of net and gross revenues caused a miscalculation of the Organization’s total lost revenue. Cause: These errors indicate there is a lack of policies governing the review and approval of the lost revenue calculation to its supporting documents. Effect: The Organization did not follow their methodology for calculating lost revenues, resulting in overstating the amount of lost revenues to be claimed by $282,934. While the Organization had an error in the total amount of lost revenue calculated, the Organization has excess amounts of lost revenues to carryforward of $3,663,347. Questioned Costs: None reported. Context: Lost revenue was tested for all twelve quarters that were reported. Controls did not appear to be operating effectively for three of the quarters tested. Repeat Finding from Prior Years: No Recommendation: We recommend that the Organization enhance internal control policies to ensure that the lost revenue calculation follows the selected lost revenue methodology per the Organization’s memo. Views of Responsible Officials: Management agrees with the finding.
Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Period 4 TIN #411271856 Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The Organization is required to submit an accurate report to HHS for each filing period that funds were received. Condition: The Organization utilized net revenues and gross revenues in the lost revenue calculation causing errors in the lost revenue calculation which resulted in key line items being reported incorrectly in the Period 4 HHS Report. Cause: These key line item errors indicate there is a lack of policies governing the review and approval of the HHS Report to its supporting documents (i.e. lost revenue calculations). Effect: The Organization did not follow their methodology for calculating lost revenues, resulting in overstating the amount of lost revenues to be claimed by $282,934. While the Organization had an error in the total amount of lost revenue calculated, the Organization has excess amounts of lost revenues to carryforward of $3,663,347. As a result of the error in calculation, there were three key line items on the Period 4 HHS Report that were incorrect. Questioned Costs: None reported. Context: All key line items on the HHS Period 4 Report were tested. Of the twelve key line items tested related to lost revenue, three line items contained errors. Repeat Finding from Prior Years: No Recommendation: We recommend the Organization enhance internal control policies to ensure the HHS Report is properly reviewed prior to submission to ensure all key line items are necessary, correct, meet the requirements of the federal program, and are properly supported. Views of Responsible Officials: Management agrees with the finding.
Federal Agency: Department of Health and Human Services Federal Program Name: Chafee Education and Training Vouchers Program Assistance Listing Number: 93.599 Pass-Through Agency: MN Dept. of Human Services Pass-Through Number: GRK%157729 Type of Finding: • Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR 200.303 requires that non-Federal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: During our audit testing, we noted that there was not evidence of an internal control (supervisor approval of time and effort charged to the federal grant) for some transactions. Context: We tested 12 payroll time and effort reports. We were provided documentation supporting the time charged to the grant, but there was not evidence of a supervisory review on 6 of the reports. Cause: Time and effort reports were reviewed by a supervisor, who then sent to an email inbox once they approved. We were able to view the email approvals for recent time periods, however, emails were deleted in the system after six months so we were unable to view the approval from earlier in the year. Effect: Internal controls were not properly documented. Repeat finding: Not a repeat finding Recommendation: We recommend the Organization put procedures in place to retain documentation of supervisory approval of time and effort reports. Views of responsible officials: There is no disagreement with the audit finding.
Space Operations Assistance Listing Number: 43.007 Federal Award ID Number: 80JSC018M0005 National Aeronautics and Space Administration 2023 Funding Criteria: Competitive Procurement: 2 CFR Section 200.320 and 48 CFR section 52.244-5 sets forth the requirements for acquisition contracts awarded to vendors including the requirement to obtain price or rate quotations from an adequate number of qualified sources and the circumstances in which noncompetitive procurement methods can be used. Also, CASIS’s procurement policy states that it is in both CASIS and NASA’s interest to compete when it makes sense regardless of the threshold and can be achieved by obtaining three quotes, i.e., comparative shopping. A minimum of 3 vendors are required to demonstrate competition. CASIS may solicit a proposal from only one source in circumstances where one or more of the following conditions apply (FAR Subpart 6.3): (i) The item or service is available only from a single source. (ii) An unanticipated exigency or emergency exists that requires the equipment, materials, supplies or services to be procured immediately. (iii) NASA specifically authorizes the use of noncompetitive proposals (directed source). (iv) After consultation with a number of sources, competition is determined inadequate. (v) The vendor is listed as a sole source provider under the Cooperative Agreement. Vendor disbursements: 2 CFR section 200.214 and 2 CFR section 180.300 require non-federal entities restrict awards, subawards, and contracts with parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in federal assistance programs or activities. Internal controls: 2 CFR 200.303 provides that non-Federal entities must establish and maintain effective internal controls to provide reasonable assurance of compliance with the Uniform Guidance. - 10 - Condition: Competitive quotes were not obtained for one expense, and sole source determination was not documented for another expense. In addition, for one vendor there was no check performed to ensure it was not debarred prior to the purchase approval. Cause: For one expense, CASIS did not obtain competitive quotes as required per their policy. CASIS had used the venue for meetings in the past, and did not obtain additional quotes for this event. This is a control and compliance deficiency. For another expense tested in the sample, no documentation of this being a sole source purchase prior to expending the funds. This expense is for a membership and essentially has a single provider. This is a control deficiency, but not a compliance issue. For one vendor, CASIS did not perform SAM check prior to approving the purchase. Vendor search at SAM.gov, subsequent to year end, revealed that the vendor is not debarred. This is a control deficiency, but not a compliance issue. Effect: If CASIS cannot demonstrate that procurements were made with full and open competition, properly sole sourced, and vendors are not debarred, it can result in questioned costs and funds being returned to NASA. Questioned Costs: Known questioned costs of $17,967, and likely questioned costs of $25,293. Perspective: For open competition there were 2 out of 60 expenses selected that the control failed. There was one vendor out of 10 selected that the debarment check was not performed. Recommendation: Competitive quotes should be obtained and retained as specified in the procurement policy. Non-competitive procurement should be documented and approved prior to incurring expenses. Vendor debarment checks should be performed and documented prior to entering into covered transactions. Management Response: The audit uncovered a non-compliance with required competitive quotes for a procurement of meeting services which did not comply with CASIS policy. The predecessor management team had previously advised the responsible purchaser that these services did not require competitive quotes. This matter is also complicated by the fact that the procurements are not just for meeting space, logistics and meals, but also includes lodging, which is not subject to the three quote rule. Management acknowledges that this was a process escapement and provides for the following corrective action. Typically lodging expenses are included in the procurement because it results in discounts that are unavailable if not included. CASIS implemented a policy of requiring competitive quotes for purchases over $1,000 in the most recent revision of the procurement policy. This change was made to assure compliance with Federal Regulations. While the amount noted is within the limits established by Federal Micro- purchase regulations, it did not comply with internal policies as noted. Meeting space is a commonly used service that is highly competitive in pricing and most facilities charge competitive rates, but most of the time those quotes are not useable given the time of year, and more importantly the occupancy rate of the facility. Starting in 2024, we are requesting quotes from three facilities in the local area that will be valid for a period of one year. These rates will be updated manually and a single additional quote will be obtained to assure the “reasonableness” of the price. This process will represent an annual price survey that will satisfy the three quote rule of our procurement policy. For rental of facilities outside of the local area, we will obtain a minimum of three quotes as required by our procurement policy. Management also acknowledges the process escapement for SAM checks on new vendors. Our normal process is that annually, Finance performs a SAM check for all approved vendors. The agreement for Trust Factory came in late during the year resulting in this deficiency. When a new vendor is setup in our system, it will automatically trigger a SAM check.
2023-001 U.S. Department of Housing and Urban Development Federal Financial Assistance Listing 14.267 Continuum of Care Program Program Income Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: There was not a documented review by a separate individual outside of the preparer of the program income calculations. Cause: The Housing Authority had a review process in place over program income calculations. However, the review process was not documented. Effect: Without a documented review and approval, there is a possibility for errors in the calculation of program income. Questioned Costs: None reported Context/Sampling: A nonstatistical sample of 13 participants out of 65 participants were selected for program income testing. Repeat Finding from Prior Year: No Recommendation: We recommend the Housing Authority to implement a documentation process around the review and approval of program income calculations. Views of Responsible Officials: Management agrees with the finding.
Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Applicable Federal Award Number and Year – Period 4 TIN #860107344 Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: The Hospital did not consider the impact of the year-end audit adjustments on the quarters applicable to Period 4 when reporting lost revenue. Cause: The established internal controls did not consider the effect of the year-end audit adjustments by quarter for Period 4 to ensure accurate quarterly reporting of net patient revenue. Effect: The lack of adequate policies governing report preparation and submission increases the risk that the report could be filed incorrectly. Questioned Costs: None reported relating to Period 4 as eligible expenditures and lost revenues exceeded Period 4 funds received. However, future amounts eligible for lost revenues is overstated by $63,347 on the Period 4 report. Context: There are 16 key line items related to lost revenue which were tested on the Period 4 Department of Health and Human Services special report. 4 of the 16 key line items did not actually represent net patient service revenue. Repeat Finding from Prior Years: Yes, prior year finding 2022-003 Recommendation: We recommend that the Hospital strengthen the control process relating to calculating quarterly lost revenue under the federal program. Views of Responsible Officials: Management agrees with the finding.
Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Applicable Federal Award Number and Year – Period 4 TIN #860107344 Activities Allowed/Allowable Costs Material Weakness in Internal Control Over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: The Hospital’s expenditures identified as eligible and claimed under the Provider Relief Fund program did not agree to the underlying detail listing. The current key financial personnel were unable to reconcile the differences between the support and the amounts reported. Cause: There was turnover in key financial positions. The established internal controls did not ensure the underlying detail supported expenditures identified as eligible and claimed. Effect: The lack of adequate policies governing report preparation and submission increases the risk that the report could be filed incorrectly. Questioned Costs: None reported relating to Period 4 as total eligible expenditures on the underlying detail listing exceeded amount of Period 4 funds received. Context: A total non-statistical sample of 60 transactions were tested which accounted for $2,558,991 of $3,645,080 identified on the detail listing. This exceeded the $2,074,204 of funds received in Period 4. Repeat Finding from Prior Years: No. Recommendation: We recommend that the Hospital strengthen the control process for maintaining documentation of the final expenditure listing used to claim the allowable costs under the federal program. Views of Responsible Officials: Management agrees with the finding.
Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Applicable Federal Award Number and Year – Period 4 TIN #860107344 Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: The Hospital’s expenditures reported as eligible and claimed under the Provider Relief Fund program did not agree to the underlying detail listing. The current key financial personnel were unable to reconcile the differences between the support and the amounts reported. Cause: There was turnover in key financial positions. The established internal controls did not ensure the underlying detail supported expenditures reported for Period 4. Effect: The lack of adequate policies governing report preparation and submission increases the risk that the report could be filed incorrectly. Questioned Costs: None reported relating to Period 4 as total eligible expenditures on the underlying detail listing exceeded amount of Period 4 funds received. Context: The key line item related to total Provider Relief Expenses was tested on the Period 4 Department of Health and Human Services special report. Repeat Finding from Prior Years: No Recommendation: We recommend that the Hospital strengthen the control process for maintaining documentation of the final expenditure listing used to report under the federal program. Views of Responsible Officials: Management agrees with the finding.
S3800-010 Finding Reference Number – 2023-002 S3800-011 Title and CFDA Number of Federal Program – Section 232 Loan – Mortgage Insurance Nursing Homes, Intermediate Care Facilities, Board and Care Homes and Assisted Living Facilities Loan, ALN 14.129 S3800-015 Type of Finding – Federal Award Finding Other Matters S3800-016 Finding Resolution Status – In progress S3800-017 Information on Universe Population Size – 1,710 checks and bank transfers, all disbursements from bank accounts. S3800-018 Sample Size Information – Sample size was 49 disbursements. Errors were found on 2 out of the 49 disbursements tested. S3800-019 Identification of Repeat Finding and Finding Reference Number – N/A S3800-020 Criteria – Per 2 CFR sections 200.302 and 200.303 of the Uniform Guidance, an entity must establish and maintain effective internal control over the federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations and terms and conditions of the federal award. Allowable cost controls of Cheney Care Community require general ledger account coding to be written on each invoice to be reviewed by the Executive Director before the invoice is processed to be paid. S3800-030 Statement of Condition – During our audit, we noted two invoices that did not include the general ledger account coding on the invoices, as required by Cheney Care Community’s allowable cost controls. The invoices were recorded to the proper general ledger accounts. S3800-032 Cause – Cheney Care Community did not follow their documented internal controls over financial reporting and allowable costs to ensure general ledger coding is included on each invoice for review and approval. S3800-033 Effect or Potential Effect – Failure to maintain effective internal controls over compliance with federal requirements increases the risk of unauthorized or unallowable transactions occurring. S3800-035 Auditor Non-Compliance Code – S (Internal Controls) S3800-037 FHA/Contract Number – 171-22029 S3800-038 Questioned Costs – $0 S3800-040 Questioned Costs – $0 S3800-045 Reporting Views of Responsible Officials – Cheney Care Community is in agreement with the findings, and the recommendations have been implemented. S3800-050 Context – A sample of 49 checks totaling $206,327 was selected for audit from a population of 1,710 checks totaling $11,294,298. The test found two checks that were not in compliance with Cheney Care Community’s allowable cost controls totaling $93. The invoices were recorded to the proper general ledger accounts. Our sample was a statistically valid sample. S3800-080 Recommendation – We recommend management of Cheney Care Community review their internal controls over the cash disbursement process with the necessary individuals involved in the process to ensure the implementation of general ledger account coding on cash disbursements is consistently performed going forward. S3800-090 Auditor’s Summary of Auditee Comments on the Findings and Recommendations – The Executive Director and A/P Clerk agreed upon using certain general ledger account codes consistently for similar purchases from the same vendor. In Cheney Care Community’s accounting system, these agreed upon general ledger account codes have been pre-set as a default for certain vendors. When invoices are received that should be appropriately coded to this default general ledger account code, errors of not documenting the general ledger account code on the invoice are periodically made. Cheney Care Community will consistently perform the general ledger account coding internal control procedures on invoices going forward. S3800-130 Response Indicator – Agree S3800-140 Completion Date – September 30, 2024 S3800-150 Response – Cheney Care Community will consistently perform the general ledger account coding internal control procedures on invoices going forward.
S3800-010 Finding Reference Number – 2023-002 S3800-011 Title and CFDA Number of Federal Program – Section 202 Supportive Housing for the Elderly, Capital Advance and Project Rental Assistance Contract, ALN 14.157 S3800-015 Type of Finding – Federal Award Finding; Other Matters S3800-016 Finding Resolution Status – In progress S3800-017 Information on Universe Population Size – 202 checks and bank transfers, all disbursements from bank accounts S3800-018 Sample Size Information – Sample size was 40 disbursements. Errors were found on 1 out of the 40 disbursements tested. S3800-019 Identification of Repeat Finding and Finding Reference Number – N/A S3800-020 Criteria – Per 2 CFR sections 200.302 and 200.303 of the Uniform Guidance, an entity must establish and maintain effective internal control over the federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations and terms and conditions of the federal award. Allowable cost controls of Sessions Village 202 require general ledger account coding to be written on each invoice to be reviewed by the Executive Director before the invoice is processed to be paid. S3800-030 Statement of Condition – During our audit, we noted one invoice that did not include the general ledger account coding on the invoice, as required by Sessions Village 202’s allowable cost controls. The invoice was recorded to the proper general ledger account. S3800-032 Cause – Sessions Village 202 did not follow their documented internal controls over financial reporting and allowable costs to ensure general ledger coding is included on each invoice for review and approval. S3800-033 Effect or Potential Effect – Failure to maintain effective internal controls over compliance with federal requirements increases the risk of unauthorized or unallowable transactions occurring. S3800-035 Auditor Non-Compliance Code – S (Internal Controls) S3800-037 FHA/Contract Number – 171-EE015 S3800-038 Questioned Costs – $0 S3800-040 Questioned Costs – $0 S3800-045 Reporting Views of Responsible Officials – Sessions Village 202 is in agreement with the findings, and the recommendations have been implemented. S3800-050 Context – A sample of 40 checks totaling $41,900 was selected for audit from a population of 202 checks totaling $186,253. The test found one check that was not in compliance with Sessions Village 202’s allowable cost controls totaling $369. The invoice was recorded to the proper general ledger account. Our sample was a statistically valid sample. S3800-080 Recommendation – We recommend management of Sessions Village 202 review their internal controls over the cash disbursement process with the necessary individuals involved in the process to ensure the implementation of general ledger account coding on cash disbursements is consistently performed going forward. S3800-090 Auditor’s Summary of Auditee Comments on the Findings and Recommendations – The Executive Director and A/P Clerk agreed upon using certain general ledger account codes consistently for similar purchases from the same vendor. In Sessions Village 202’s accounting system, these agreed upon general ledger account codes have been pre-set as a default for certain vendors. When invoices are received that should be appropriately coded to this default general ledger account code, errors of not documenting the general ledger account code on the invoice are periodically made. Sessions Village 202 will consistently perform the general ledger account coding internal control procedures on invoices going forward. S3800-130 Response Indicator – Agree S3800-140 Completion Date – September 30, 2024 S3800-150 Response – Sessions Village 202 will consistently perform the general ledger account coding internal control procedures on invoices going forward.
S3800-010 Finding Reference Number – 2023-002 S3800-011 Title and CFDA Number of Federal Program – Section 202 Supportive Housing for the Elderly, Capital Advance and Project Rental Assistance Contract, ALN 14.157 S3800-015 Type of Finding – Federal Award Finding; Other Matters S3800-016 Finding Resolution Status – In progress S3800-017 Information on Universe Population Size – 202 checks and bank transfers, all disbursements from bank accounts S3800-018 Sample Size Information – Sample size was 40 disbursements. Errors were found on 1 out of the 40 disbursements tested. S3800-019 Identification of Repeat Finding and Finding Reference Number – N/A S3800-020 Criteria – Per 2 CFR sections 200.302 and 200.303 of the Uniform Guidance, an entity must establish and maintain effective internal control over the federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations and terms and conditions of the federal award. Allowable cost controls of Sessions Village 202 require general ledger account coding to be written on each invoice to be reviewed by the Executive Director before the invoice is processed to be paid. S3800-030 Statement of Condition – During our audit, we noted one invoice that did not include the general ledger account coding on the invoice, as required by Sessions Village 202’s allowable cost controls. The invoice was recorded to the proper general ledger account. S3800-032 Cause – Sessions Village 202 did not follow their documented internal controls over financial reporting and allowable costs to ensure general ledger coding is included on each invoice for review and approval. S3800-033 Effect or Potential Effect – Failure to maintain effective internal controls over compliance with federal requirements increases the risk of unauthorized or unallowable transactions occurring. S3800-035 Auditor Non-Compliance Code – S (Internal Controls) S3800-037 FHA/Contract Number – 171-EE015 S3800-038 Questioned Costs – $0 S3800-040 Questioned Costs – $0 S3800-045 Reporting Views of Responsible Officials – Sessions Village 202 is in agreement with the findings, and the recommendations have been implemented. S3800-050 Context – A sample of 40 checks totaling $41,900 was selected for audit from a population of 202 checks totaling $186,253. The test found one check that was not in compliance with Sessions Village 202’s allowable cost controls totaling $369. The invoice was recorded to the proper general ledger account. Our sample was a statistically valid sample. S3800-080 Recommendation – We recommend management of Sessions Village 202 review their internal controls over the cash disbursement process with the necessary individuals involved in the process to ensure the implementation of general ledger account coding on cash disbursements is consistently performed going forward. S3800-090 Auditor’s Summary of Auditee Comments on the Findings and Recommendations – The Executive Director and A/P Clerk agreed upon using certain general ledger account codes consistently for similar purchases from the same vendor. In Sessions Village 202’s accounting system, these agreed upon general ledger account codes have been pre-set as a default for certain vendors. When invoices are received that should be appropriately coded to this default general ledger account code, errors of not documenting the general ledger account code on the invoice are periodically made. Sessions Village 202 will consistently perform the general ledger account coding internal control procedures on invoices going forward. S3800-130 Response Indicator – Agree S3800-140 Completion Date – September 30, 2024 S3800-150 Response – Sessions Village 202 will consistently perform the general ledger account coding internal control procedures on invoices going forward.
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter
Material Weakness- Internal Controls over Reporting and Noncompliance Department of Housing and Urban Development - Direct Program - CDBG Entitlement Grants Cluster-ALN 14.218 - Program Year 2023 Criteria- 2 CFR section 200.303 - Internal Controls of the Uniform Guidance states that the non-federal entity must (a) establish and maintain effective internal controls over federal award that provides reasonable assurance that the non-federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards in Internal Control in the Federal Government" issued by the Comptroller General of the United States of the "Internal Control by the Committee of Sponsoring Organizations of the Treadway Commission (COSO)". 2 CFR Part 170 requires non-federal entities making first-tier subawards of federal funding to comply with the reporting requirements of the Federal Funding Accountability and Transparency Act of 2006 (FFATA) (Public Law 109-282), as amended by section 6202 of Public Law 110-252. Compliance with FFATA requires prime recipients, to report certain information about subawards to the FFATA Subaward Reporting System (FSRS) by the end of the month, plus 30 days, in which the award is made. Condition- The County did not report required information about subawards made under Assistance Listing No. 14.218 to the FSRS as required by FFATA within the timeline required. There were 7 subawards not report representing $2,417,617 in total. Cause/ Effect - The County did no have internal controls in place to ensure accurate and timely subaward information is reported to the FSRS. Questioned Costs- None Auditor's Recommendation - We recommend that the County have policies in place to ensure information si report to the FSRS as required by FFATA. Management Response - See Corrective Action Plan Letter