Finding 375719 (2023-002)

Program: COVID-19 American Rescue Plan – Period 5 Federal Assistance Listing Number: 93.498 Type of Finding: Material Weakness in Internal Control Over Compliance Compliance Requirement: Reporting Condition: Scheurer Hospital did not meet its requirements to properly report the lost revenue and expenses used to prevent, prepare for, and respond to coronavirus and that the payment shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus. Criteria: The American Rescue Plan Funds are to be used to prevent, prepare for, and respond to coronavirus and that the funds shall reimburse the recipient only for healthcare related expenses or lost revenues that are attributable to coronavirus during the period of availability which are not reimbursed by other sources. Context: During the audit, it was determined the amounts reported in the portal for Period 5 did not agree to the actual expenses and lost revenue utilized to support how the funds were used to prevent, prepare for, and respond to coronavirus. Cause: Management’s internal controls over reporting did not identify these instances of non-compliance timely. Effect: Scheurer Hospital is not in compliance with federal regulations and guidelines surrounding the use of the American Rescue Plan Funds. The classification of actual expenses and lost revenue utilized to earn the funds did not agree to the amounts reported in the portal for Period 5. However, management did provide the auditor with sufficient and appropriate audit evidence of the actual expenses and lost revenue used to support the amount of funding recognized for Period 5. As a result, no amount is due to the program. Recommendation: We recommend management review the supporting documentation prior to reporting the information in the reporting portal to ensure expenses are being reported in the Reporting Portal accurately. Views of Responsible Official: Management will evaluate the above recommendations and implement recommendations where deemed appropriate.