Finding 399080 (2023-003)

Health Center Infrastructure Support Financial Reporting Federal Agency: Department of Health and Human Services Program: Health Center Infrastructure Support Assistance Listing #: 93.526 Criteria In accordance with OMB Uniform Guidance 2 CFR 200.302(2), the financial management system of each non-Federal entity must provide for accurate, current, and complete disclosure of the financial results of each Federal award or program. Condition The Health Center Infrastructure Support award requires recipients to submit a Federal Financial Report (FFR) on an annual basis. Sunset Park submitted the FFRs due in 2023 and 2024 (for expenses incurred in 2022 and 2023, respectively) in a timely manner, however, the financial information included on the FFRs was reported on a cash basis instead of the accrual basis indicated by Sunset Park on the FFRs. Cause Sunset Park did not select the appropriate basis of accounting on the FFRs that correlated to the financial information being reported. Effect The FFRs submitted for the 2022 and 2023 budget periods underreported cumulative federal expenditures incurred under the program by $1,049,618, which represents the difference between expenditures incurred through the end of the 2023 budget period and cash receipts as of that same date. The Schedule of Expenditures of Federal Awards in both years, however, accurately reported the accrual basis expenditures. Questioned Costs There are no questioned costs associated with this finding. Recommendation Sunset Park should contact the Federal awarding agency to determine appropriate action to correct the previously submitted FFRs. Sunset Park should also enhance its control procedures to ensure that FFRs submitted are reconciled to the underlying accounting records to ensure accurate, current, and complete disclosure.