Finding Text
Federal agency: U.S. Department of Health and Human Services Other Programs
Federal program title: Provider Relief Funding
Assistance Listing Number: 93.498
Pass-Through Agency: N/A
Pass-Through Number(s): N/A
Award Period: Period 1 & 2
Type of Finding: Significant Deficiency in Internal Control in and over Compliance
Compliance Requirement: Allowable Costs
Criteria or specific requirement: Surrounding reporting activities, the Hospital’s internal controls should be designed to assure all reporting completed under program guidelines.
Condition: During our testing, we identified the Hospital did not have internal controls in place to ensure reporting was completed in accordance with HHS guidelines.
Questioned costs: $180,000
Context: During our testing, it was identified that the Hospital reported approximately $180,000 in capital expenditures that were not applicable to COVID-19 as required under the program guidelines.
Cause: During testing it was noted that there was a formula error within the expense spreadsheet, which caused erroneous expenses to be included with the reporting.
Effect: The auditor noted that although $180,000 of non-COVID-19 costs were included in the expenses claimed this had no overall impact on the total provider relief funds reported as there is sufficient lost revenues to more than offset this amount. However, the internal controls around compliance over allowable costs were not effective.
Repeat Finding: N/A
Recommendation: We recommend the Hospital design controls to ensure documentation is completed timely and sufficiently on how costs are necessary to respond to COVID-19.
Views of responsible officials: There is no disagreement with the audit finding. Management has identified a sufficient amount of lost revenue, that were reported, to cover the finding amounts.