Finding 1095697 (2022-003)

Material Weakness
Requirement
I
Questioned Costs
-
Year
2022
Accepted
2025-01-14
Audit: 337911
Organization: Wakemed (NC)

AI Summary

  • Core Issue: WakeMed failed to include federal funds from the U.S. Department of the Treasury in their financial statements, leading to an incomplete Schedule of Expenditures of Federal Awards (SEFA).
  • Impacted Requirements: This finding violates 2 CFR 200.508(b) and 200.510, which require accurate financial statements and a complete SEFA for federal awards.
  • Recommended Follow-Up: Management should enhance controls to ensure all federal funding is identified and accurately reported in the SEFA, and staff should be reeducated on these processes.

Finding Text

Assistance Listing Number, Federal Agency, and Program Name - 21.027 U.S. Department of the Treasury Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - YDYNCVFA9NH4 Pass through Entity - City of Raleigh, North Carolina Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.508(b), an auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards, in accordance with 200.510 financial statements. Per 2 CFR 200.510(b), 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 200.502 basis for determining federal awards expended. Condition - Controls in place were not adequate to ensure the schedule of federal expenditures was complete and accurate. Questioned Costs - N/A Identification of How Questioned Costs Were Computed - N/A Context - WakeMed did not initially include the funds received through the U.S. Department of the Treasury American Rescue Plan Act of 2021, Coronavirus State and Local Fiscal Recovery Funds on the SEFA. Cause and Effect - WakeMed did not have a process in place to identify all potential sources of federal funding received during the year, resulting in the SEFA being incomplete for the year ended September 30, 2022. Upon discovery of the error, WakeMed prepared a SEFA that included the U.S. Department of the Treasury American Rescue Plan Act of 2021, Coronavirus State and Local Fiscal Recovery Funds. This lack of controls resulted in the reissuance of the 2022 single audit. Recommendation - Management should implement controls to ensure all federal funding received is properly identified as such and included on the SEFA. Views of Responsible Officials and Planned Corrective Actions - Management agrees with the finding as reported. The federal funding was not received until fiscal year 2023 while some expenditures were incurred in fiscal year 2022. The timing of events contributed to the oversight on the 2022 SEFA. WakeMed has reeducated staff on the preparation of the SEFA in order to prevent this error from reoccurring.

Categories

Reporting Material Weakness

Other Findings in this Audit

  • 519253 2022-001
    Significant Deficiency
  • 519254 2022-002
    Significant Deficiency Repeat
  • 519255 2022-003
    Material Weakness
  • 519256 2022-004
    Material Weakness
  • 1095695 2022-001
    Significant Deficiency
  • 1095696 2022-002
    Significant Deficiency Repeat
  • 1095698 2022-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
93.498 Covid-19 - Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $10.90M
93.461 Covid-19 - Hrsa Covid-19 Claims Reimbursement for the Uninsured Program and the Covid-19 Coverage Assistance Fund $3.36M
21.027 Covid-19 - Coronavirus State and Local Fiscal Recovery Funds $1.01M
14.218 Community Development Block Grants/entitlement Grants $190,937
93.107 Area Health Education Centers $151,063