Finding Text
Finding 2023-003: Incorrect Reporting of Lost Revenue
Federal Agencies
U.S. Department of Health and Human Services
Program Name (Federal Assistance Listing Number)
COVID-19 - Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution (93.498)
Criteria or specific requirement
Lost revenue is required to be reported in the PRF reporting portal in accordance with one of the three methodologies included in the compliance supplement.
Condition
Management elected to report actual lost revenue in their PRF Period 5 submission, however lost revenue does not agree to management’s underlying general ledger or audited financial statements and could not be reconciled to reported amounts for all reporting periods from 2019 through June 30, 2023.
Cause
Due to changes in management and limited staffing, current management was unable to locate the reconciliations used to report lost revenue in the PRF Period 5 submission.
Effect
Although the Center reported lost revenue of $22,678,671, actual lost revenue per the Center’s general ledger and audited financial statements should have been $26,521,238. Accordingly, management understated lost revenue by $3,842,567.
Questioned Costs
None
Context
The Center’s changes in management personnel led to current management's inability to locate any reconciling items that may have been used by the predecessor management team in reporting period 5 lost revenues.
Identification of a repeat finding
No
Recommendation
Management should contact HRSA for permission to amend their PRF Period 5 submission.
Views of responsible officials
See corrective action plan