Finding No.: 2019-010
Federal Agency: U.S. Department of Health and Human Services
CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance
Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001
Area: Period of Performance
Questioned Costs: $97,710
Criteria:
In accordance with 45 CFR §75.309, a non-Federal entity may charge to the federal award only allowable costs incurred during the period of performance and any costs incurred before the U.S. Department of Health and Human Services (HHS) awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity. Funds available to pay allowable costs during the period of performance include both federal funds awarded and carryover balances. In addition, a non-Federal entity must liquidate all obligations incurred under the award not later than 90 days after the end of the funding period. This deadline may be extended with prior written approval from the HHS awarding agency.
Condition:
Of nineteen expenditures tested, aggregating of $138,858 of a total population of $1,970,581, the following deficiency was noted:
1. For one (or 5%), the cancelled check for Document Number 1479917 (Business Unit H9243B, dated 09/30/19) amounting to $10,000 was not provided; accordingly, CHCC was not able to substantiate that the payment was liquidated within the grant award’s 90 days liquidation period, for which the amount is questioned.
2. For seven (or 37%), expenditures were liquidated after the liquidation period end date of 12/29/18.
Finding No.: 2019-010, continued
Federal Agency: U.S. Department of Health and Human Services
CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance
Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001
Area: Period of Performance
Questioned Costs: $97,710
Condition, continued:
3. For two (or 11%), expenditures were incurred/obligated after the obligation periods. No questioned costs are presented as amounts are questioned at Condition 1 for Document Number 1479917 and at Condition 2 for Document Number 1428464.
4. For one (or 5%), the transaction pertains to indirect costs charges for which the expenditure was charged to the Program after the 90 days liquidation period end date of 12/29/18.
Finding No.: 2019-010, continued
Federal Agency: U.S. Department of Health and Human Services
CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance
Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001
Area: Period of Performance
Questioned Costs: $97,710
Condition, continued:
Of five subsequent expenditures tested, aggregating $2,486 of a total population of $6,362, the following deficiencies were noted:
5. For one (or 20%), the supporting documents were not provided. Accordingly, CHCC was not able to substantiate that the expenditure was incurred/obligated within the period of performance end date of 09/29/19 and was liquidated within the liquidation period end date of 12/29/19.
6. For two (or 40%), expenditures were liquidated after the liquidation period end date of 12/29/19.
Cause:
CHCC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements.
Finding No.: 2019-010, continued
Federal Agency: U.S. Department of Health and Human Services
CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance
Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001
Area: Period of Performance
Questioned Costs: $97,710
Effect:
CHCC is in noncompliance with applicable period of performance requirements and questioned costs of $97,710 result.
Recommendation:
Responsible CHCC personnel should establish recordkeeping system whereby underlying support for each transaction is substantiated and filed and enforce monitoring control over compliance with applicable period of performance requirements.
Views of Responsible Officials:
CHCC’s Corrective Action Plan provides a detailed rationale for disagreement with the finding described in Conditions 1 to 4 and 6 and states agreement with Condition 5; however, disagrees with the questioned costs.
Auditor Response:
Condition 1 - The cancelled check was not provided.
Condition 2 - Check clearance dates were after the liquidation period end date of 12/29/18.
Condition 3 - Obligation period end dates were obtained from documentations provided by CHCC.
Finding No.: 2019-010, continued
Federal Agency: U.S. Department of Health and Human Services
CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance
Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001
Area: Period of Performance
Questioned Costs: $97,710
Auditor Response, continued:
Condition 4 - The indirect costs was charged to the Program on 12/31/18, which is after the period of performance end date of 12/29/18.
Condition 5 - Questioned costs are warranted given the transaction tested was not supported with adequate documentations.
Condition 6 - Expenditures were liquidated after the liquidation period end date of 12/29/19.
In addition, initial draft reports were provided to CHCC on 09/06/24 and 09/24/24. It was also agreed during the 09/06/24 and 10/04/24 meetings for CHCC to provide corresponding underlying accounting records to resolve the finding; however, no documentations were provided within the agreed timeline. Accordingly, finding is sustained.