FAC Explorer

Finding 421367 (2022-003)

Significant Deficiency
Requirement
F
Questioned Costs
-
Year
2022
Accepted
2023-09-28
Audit: 312296
Organization: Novant Health, Inc. (NC)
Auditor: Pricewaterhousecoopers LLP

AI Summary

  • Core Issue: No physical inventory of federally funded equipment has been conducted since July 2019, leading to a significant deficiency in compliance.
  • Impacted Requirements: This violates 2 CFR 200.313 d(2), which mandates a physical inventory every two years.
  • Recommended Follow-Up: Implement a control process for regular physical inventories and conduct a full inventory of all equipment promptly.

Finding Text

2022-003: Evidence of physical inspection of equipment purchased with federal funds was not maintained ? Significant deficiencyCluster: Not applicableFederal Granting Agency: Health Resources and Services Administration (?HRSA?)Award Name: COVID-19 National Bioterrorism Hospital Preparedness Program (?Bioterrorism Program?)Award #: N/AAssistance Listing #: 93.889Award Year: Fiscal year 2022Pass-through entity: North Carolina Healthcare Foundation; North Carolina Department of Health and Human Services ? Division of Health Service Regulation, Office of Emergency Medical ServicesPass-through award #: U3REP 200659; 42705; 44024Condition:As part of our testing over the equipment compliance requirements related to the Bioterrorism Program, we noted no physical inventory of equipment performed by management that was purchased with federal funds since the inception of the grants in July 2019. Management has noted that routine maintenance checks are performed periodically on all equipment, however, we were unable to obtain management?s evidence of these checks for our 25 selections. At the end of the fiscal year, there were approximately 225 pieces of equipment with a value of approximately $800,000.Criteria:2 CFR 200.313 d(2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years.Cause:Management?s process and controls do not include performing a formal physical inventory of federal equipment and retaining evidence of this process at least once every two years and management was not aware of this requirement.Effect:The Company may not maintain complete and accurate property records or safeguard equipment appropriately.Recommendation:We recommend the Company create a control and revise its process surrounding physical inventories of equipment to include a requirement that the inventory is completed in accordance with the criteria noted above. Additionally, a full inventory of all equipment should be performed as soon as practical.Management?s Views and Corrective Action Plan:Management?s views and corrective action plan is included at the end of this report after the summary schedule of prior audit findings and status.

Corrective Action Plan

Management?s View and Corrective Action PlanThe following is Novant Health?s response to the audit of Federal programs in accordance with the Uniform Guidance for year ending December 31, 2022.2022-003: Evidence of physical inspection of equipment purchased with federal funds was not maintained ? Significant deficiencyCluster: Not applicableFederal Granting Agency: Health Resources and Services Administration (?HRSA?)Award Name: COVID-19 National Bioterrorism Hospital Preparedness Program (?Bioterrorism Program?)Award #: N/AAssistance Listing #: 93.889Award Year: Fiscal year 2022Pass-through entity: North Carolina Healthcare Foundation; North Carolina Department of Health and Human Services ? Division of Health Service Regulation, Office of Emergency Medical ServicesPass-through award #: U3REP 200659; 42705; 44024Management understands the importance of inspection and maintenance of equipment purchased utilizing funding under this grant, as well as the requirement of a physical inventory and reconciliation to property records at least bi-annually. Novant Health receives a notification of award and contract from the North Carolina Office of Emergency Medical Services (NCOEMS), Healthcare Preparedness Program (HPP) that outlines a summary of the financial information, specific grant terms, scope of work, and inventory management requirements.Corrective Action Plan and Anticipated Completion DateNovant Health management?s corrective action plan includes:? Update internal inventory management system, iCams, with needed information required to meet applicable Federal requirements? Create a formal process to update the maintenance and inventory of assets that meet this requirement that can be appropriately carried out by both paid and volunteer staff.? Complete a full inventory of all equipment purchased with federal fundsNovant Health will determine and implement a best practice to properly capture the necessary information to meet the applicable Federal requirements by October 31, 2023. We will also have the inventory management system updated by March 31, 2024, with maintenance and inspection dates required for hard supplies and equipment purchased under this grant to meet applicable Federal requirements, as well as a full inventory of federally-funded equipment, completed on a rolling basis moving forward, by June 30, 2024.Additionally, the program manager will provide an email confirming completion of the above steps to the Grants Director and team.For follow-up questions and information, please contact Randy Brantley, Novant Health Grants Director at rlbrantley@novanthealth.org.Sincerely,Randy BrantleyGrants Directorrlbrantley@novanthealth.org

Categories

Equipment & Real Property Management

Other Findings in this Audit

  • 421362 2022-001
    -
  • 421363 2022-001
    -
  • 421364 2022-002
    Significant Deficiency
  • 421365 2022-002
    Significant Deficiency
  • 421366 2022-002
    Significant Deficiency
  • 421368 2022-003
    Significant Deficiency
  • 421369 2022-003
    Significant Deficiency
  • 997804 2022-001
    -
  • 997805 2022-001
    -
  • 997806 2022-002
    Significant Deficiency
  • 997807 2022-002
    Significant Deficiency
  • 997808 2022-002
    Significant Deficiency
  • 997809 2022-003
    Significant Deficiency
  • 997810 2022-003
    Significant Deficiency
  • 997811 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.498 Provider Relief Fund $20.79M
93.461 Covid-19 Testing for the Uninsured $4.10M
32.006 Covid-19 Telehealth Program $1.12M
93.918 Grants to Provide Outpatient Early Intervention Services with Respect to Hiv Disease $313,575
93.889 National Bioterrorism Hospital Preparedness Program $260,655
93.778 Medical Assistance Program $211,892
93.153 Coordinated Services and Access to Research for Women, Infants, Children, and Youth $131,539
93.155 Rural Health Research Centers $126,120
93.917 Hiv Care Formula Grants $111,074
93.107 Area Health Education Centers Point of Service Maintenance and Enhancement Awards $88,295
93.110 Maternal and Child Health Federal Consolidated Programs $83,324
10.557 Special Supplemental Nutrition Program for Women, Infants, and Children $41,152
93.810 Paul Coverdell National Acute Stroke Program National Center for Chronic Disease Prevention and Health Promotion $35,175
93.226 Research on Healthcare Costs, Quality and Outcomes $17,308
93.426 Improving the Health of Americans Through Prevention and Management of Diabetes and Heart Disease and Stroke $15,661
93.080 Blood Disorder Program: Prevention, Surveillance, and Research $12,308
93.865 Child Health and Human Development Extramural Research $4,309
93.470 Alzheimer's Disease Program Initiative (adpi) $3,391
93.421 Strengthening Public Health Systems and Services Through National Partnerships to Improve and Protect the Nations Health $2,426
93.969 Pphf Geriatric Education Centers $850