FAC Explorer

Finding 1084451 (2019-015)

Material Weakness
Requirement
C
Questioned Costs
$1
Year
2019
Accepted
2024-11-14
Audit: 328484
Organization: Commonwealth Healthcare Corporation (MP)
Auditor: Ernst & Young (cnmi) INC

AI Summary

  • Core Issue: CHCC failed to comply with cash management requirements, leading to questioned costs of $524,804 due to delays in fund disbursement and lack of necessary approvals.
  • Impacted Requirements: Non-compliance with 31 CFR Part 205 and grant terms regarding timely fund payout and required approvals for drawdowns.
  • Recommended Follow-Up: CHCC should establish monitoring controls to minimize fund transfer delays and implement a recordkeeping system for transaction support documentation.

Finding Text

Finding No.: 2019-015 Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.870 Maternal, Infant and Early Childhood Home Visiting Grant Program Award Number: X10MC29495 and X10MC31162 Area: Cash Management Questioned Costs: $524,804 Criteria: In accordance with 31 CFR Part 205, a State and a Federal Program Agency must minimize the time elapsing between the transfer of funds from the United States Treasury and the State's payout of funds for Federal assistance program purposes, whether the transfer occurs before or after the payout of funds. State interest liability accrues from the day Federal funds are credited to a State account to the day the State pays out the Federal funds for Federal assistance program purposes. Interest earned on advances of Program funds at the State and local levels shall be treated in accordance with the provisions of 31 CFR part 205, which implement the requirements of the Cash Management Improvement Act (CMIA) of 1990. In addition, in accordance with the grant terms and conditions, all drawdown of federal funds from the Payment Management System (PMS) must have approval of the Grants Management Officer before funds are drawn. Condition: Of five drawdowns tested, aggregating $524,804 of a total population of $750,948, the following deficiencies were noted: 1. For one (or 20%), of the $97,117 drawdown amount, the payment for check number 9199 was liquidated almost a year from the check issued date. No questioned costs are presented as the potential interest liability is less than $500. 2. For one (or 20%), the payment has not been liquidated. No questioned costs are presented as the potential interest liability would have been less than $500 as of our field work date of 09/10/24. Finding No.: 2019-015, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.870 Maternal, Infant and Early Childhood Home Visiting Grant Program Award Number: X10MC29495 and X10MC31162 Area: Cash Management Questioned Costs: $524,804 Condition, continued: 3. For five (or 100%), approved SF 270 evidencing prior approval by the Grants Management Officer of anticipated expenditures prior to drawdown of funds were not provided. Cause: CHCC did not enforce recordkeeping and monitoring controls over compliance with applicable cash management requirements and lacks monitoring controls over drawdown processing. Effect: CHCC is in incompliance with applicable cash management requirements and questioned costs of $524,804 for Condition 3. Recommendation: CHCC should implement monitoring control procedures to ensure that the time elapsing between the transfer of Federal funds from the United States Treasury and the payout of funds by CHCC is minimized. In addition, responsible CHCC personnel should establish recordkeeping system whereby underlying support for each transaction is substantiated and filed. Finding No.: 2019-015, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.870 Maternal, Infant and Early Childhood Home Visiting Grant Program Award Number: X10MC29495 and X10MC31162 Area: Cash Management Questioned Costs: $524,804 Views of Responsible Officials: CHCC’s Corrective Action Plan provides a detailed rationale for disagreement with the finding described in Conditions 1 to 3. Auditor Response: Conditions 1 and 2 - While we understand that CHCC have no control over the timeliness of vendors cashing CHCC’s issued checks, CHCC is required to minimize the time elapsing between the transfer of funds from the United States Treasury and disbursements of federal funds and this can be achieved through the monitoring of outstanding checks during its bank reconciliation process. Condition 3 - Forms SF 270 evidencing prior grantor approval were not provided. 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.

Categories

Questioned Costs Cash Management

Other Findings in this Audit

  • 507998 2019-004
    Material Weakness Repeat
  • 507999 2019-005
    Material Weakness Repeat
  • 508000 2019-006
    Material Weakness Repeat
  • 508001 2019-007
    Material Weakness Repeat
  • 508002 2019-008
    Material Weakness Repeat
  • 508003 2019-009
    Material Weakness
  • 508004 2019-010
    Material Weakness
  • 508005 2019-011
    Material Weakness Repeat
  • 508006 2019-012
    Material Weakness Repeat
  • 508007 2019-013
    Material Weakness Repeat
  • 508008 2019-014
    Material Weakness
  • 508009 2019-015
    Material Weakness
  • 508010 2019-016
    Material Weakness Repeat
  • 1084440 2019-004
    Material Weakness Repeat
  • 1084441 2019-005
    Material Weakness Repeat
  • 1084442 2019-006
    Material Weakness Repeat
  • 1084443 2019-007
    Material Weakness Repeat
  • 1084444 2019-008
    Material Weakness Repeat
  • 1084445 2019-009
    Material Weakness
  • 1084446 2019-010
    Material Weakness
  • 1084447 2019-011
    Material Weakness Repeat
  • 1084448 2019-012
    Material Weakness Repeat
  • 1084449 2019-013
    Material Weakness Repeat
  • 1084450 2019-014
    Material Weakness
  • 1084452 2019-016
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
10.557 Wic Special Supplemental Nutrition Program for Women, Infants, and Children $3.68M
93.268 Immunization Cooperative Agreements $3.36M
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $1.97M
93.870 Maternal, Infant and Early Childhood Homevisiting Grant Program $865,589
93.104 Comprehensive Community Mental Health Services for Children with Serious Emotional Disturbances (sed) $763,992
93.982 Mental Health Disaster Assistance and Emergency Mental Health $613,302
93.116 Project Grants and Cooperative Agreements for Tuberculosis Control Programs $589,264
93.898 Cancer Prevention and Control Programs for State, Territorial and Tribal Organizations $544,042
15.875 Economic, Social, and Political Development of the Territories $533,528
97.032 Crisis Counseling $501,942
93.074 Hospital Preparedness Program (hpp) and Public Health Emergency Preparedness (phep) Aligned Cooperative Agreements $494,660
93.994 Maternal and Child Health Services Block Grant to the States $452,851
93.236 Grants to States to Support Oral Health Workforce Activities $331,358
93.217 Family Planning Services $272,252
93.251 Universal Newborn Hearing and Screening $269,168
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $258,698
93.959 Block Grants for Prevention and Treatment of Substance Abuse $233,626
93.165 Grants to States for Loan Repayment $125,000
93.945 Assistance Programs for Chronic Disease Prevention and Control $120,169
93.917 Hiv Care Formula Grants $115,562
93.958 Block Grants for Community Mental Health Services $110,106
93.110 Maternal and Child Health Federal Consolidated Programs $89,729
93.644 Adult Medicaid Quality: Improving Maternal and Infant Health Outcomes in Medicaid and Chip $86,496
93.069 Public Health Emergency Preparedness $69,626
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $66,588
93.377 Prevention and Control of Chronic Disease and Associated Risk Factors in the U.s. Affiliated Pacific Islands, U.s. Virgin Islands, and P. R. $65,865
93.314 Early Hearing Detection and Intervention Information System (ehdi-Is) Surveillance Program $64,766
93.504 Family-To-Family Health Information Centers $63,569
93.788 Opioid Str $57,326
93.150 Projects for Assistance in Transition From Homelessness (path) $53,208
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $46,310
93.991 Preventive Health and Health Services Block Grant $39,096
93.889 National Bioterrorism Hospital Preparedness Program $32,585
93.073 Birth Defects and Developmental Disabilities - Prevention and Surveillance $16,318
97.088 Disaster Assistance Projects $12,625
10.855 Distance Learning and Telemedicine Loans and Grants $6,162
93.817 Hospital Preparedness Program (hpp) Ebola Preparedness and Response Activities $4,921
93.103 Food and Drug Administration Research $4,911
10.578 Wic Grants to States (wgs) $3,323
16.575 Crime Victim Assistance $1,379