Finding Text
Item 2025-004 - Reporting - U.S. Department of Health and Human Services, Health Center Program Cluster (Assistance Listing Number 93.224/93.527) Notice of Award Number 6 H80CS00505-23-04, 6 H2ECS45602-02-04, 1 H8LCS50772-01-00 and 6 H8HCS46163-03-01 - (Significant Deficiency) Criteria: In accordance with 2 CFR § 200.327 and the terms and conditions of the federal award, LBUCC is required to submit accurate and timely Federal Financial Reports (SF-425) that reflect cumulative expenditures, unobligated balances, and program income. These reports must align with the underlying accounting records and be supported by documentation evidencing management's review and approval prior to submission. Statement of Condition: LBUCC did not maintain documentation evidencing management's review of the Federal Financial Report (SF-425) prior to submission. Although the reports were submitted timely, there were no indication of formal review procedures to validate the accuracy, completeness, or consistency of reported financial data with the accounting records. Cause: Lack of policies and procedures in relation to the review of the Federal Financial Report by a knowledgeable individual who is not the preparer thereof. Effect: In the absence of documented review, there is an increased risk of inaccurate financial reporting, which could lead to misstated expenditures and noncompliance with federal reporting requirements. Questioned Costs: None Context: All four annual Federal Financial Report (SF-425) tested had no evidence of review prior to submission. However, there was adequate support for the reports and the reports agreed to the underlying records. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that LBUCC establish and implement a formal review process over the Federal Financial Report (SF-425); we also recommend that evidence of the review be documented and approval be kept on file. Management Response: Management agrees with the finding and will be implementing formal review procedures including documented evidence of review and approval prior to submission.