Finding Text
Department of Health and Human Services
Federal Assistance Listing #93.498
COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution
Applicable Federal Award Number and Year – Period 4 TIN #390992883
Activities Allowed or Unallowed, Allowable Costs/Cost Principles and Reporting
Material Weakness in Internal Control Over Compliance
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control
over the federal award that provides assurance that the entity is managing the federal award in compliance with
federal statutes, regulations, and conditions of the federal award.
Condition: During our testing, there was no documentation of review and approval of the expenditure listing,
lost revenue calculation, or the HHS Period 4 report.
Cause: The Medical Center did not have an adequate internal control policy in place to ensure review and
approval of expenditures and lost revenue claimed under the federal program, and the HHS Period 4 report was
documented.
Effect: Without a secondary review and approval, there is a possibility that ineligible expenditures or lost
revenue may be claimed under the program and the HHS Period 4 report may not be accurately completed.
Questioned Costs: None reported.
Context: A nonstatistical sample of 14 expenditures was selected for testing, which accounted for $493,531 of
$2,074,596 direct program expenditures. There was one lost revenue calculation, one expenditure detail and
one HHS Period 4 report and all three were tested.
Repeat Finding from Prior Years: Yes, finding 2021-005.
Recommendation: We recommend that the Medical Center enhance internal control policies to ensure the
expenditure listing, lost revenue calculation, and HHS reports are reviewed and approved to ensure that all
payments are necessary, correct, meet the requirements of the federal program, and are properly recorded in
the reports required to be submitted to the federal agency.
Views of Responsible Officials: Management agrees with the finding.