Finding Text
Federal agency: U.S. Department of Health and Human Services
Federal program titles: Health Centers Cluster, Provider Relief Fund
Assistance Listing Numbers: 93.224/93.527, 93.498
Award Period: Varying project and budget periods: 2/1/21 – 1/31/22, 2/1/22 – 1/31/23, 4/1/21 – 3/31/23, PRF Reporting Period 2 for funds received 7/1/20 – 12/31/20 and used through 12/31/21
Type of Finding:
• Significant Deficiency in Internal Control over Compliance
Criteria or specific requirement: 2 CFR 200.303(a) states 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: The Organization did not have sufficient internal control process or review in place over required reporting for federal programs. There was no documentation retained of review occurring before submission of reports. Errors were identified in key line items tested in the UDS report filed for 2021 during the fiscal year 2022.
Questioned costs: None.
Context: While the Organization has historically had a review process over required federal program reporting, there was no documentation of that review occurring for the reports tested, including FFR reports and UDS report for the community Organization grants, and the required reporting for Provider Relief Funds. For the UDS report, due to an error in supporting schedules, amounts reported in Table 9E, lines 1g and 1q were overstated. There was turnover in key finance positions at the Organization, where historical segregation of duties between preparer and reviewer was not always possible.
Cause: Turnover in personnel at the Organization likely led to lapses in review processes that had been in place historically. The lack of detailed review likely resulted in the errors identified in UDS reporting. The Provider Relief Fund grant was also a newer program with unique reporting requirements the Organization had not previously experienced.
Effect: Without sufficient review processes in place, there is greater risk of noncompliance or errors in required reporting under federal programs. In the case of the UDS reporting, certain line items were misreported due to errors in supporting spreadsheets.
Recommendation: We recommend implementing a formal policy and procedure where there is a review of all required reporting by an individual that did not prepare the report. Documentation should be retained to support the review/approval occurrence.
View of responsible officials: No disagreement with the finding. Management will implement a formal review process for reporting and retain documentation of review.