Finding 508004 (2019-010)

Material Weakness
Requirement
H
Questioned Costs
$1
Year
2019
Accepted
2024-11-14

AI Summary

  • Core Issue: CHCC failed to comply with the period of performance requirements, leading to questioned costs of $97,710.
  • Impacted Requirements: Expenditures were either not documented, liquidated late, or incurred after the obligation period, violating 45 CFR §75.309.
  • Recommended Follow-Up: CHCC should implement a recordkeeping system to ensure all transactions are properly documented and monitor compliance with performance requirements.

Finding Text

Finding No.: 2019-010 Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Criteria: In accordance with 45 CFR §75.309, a non-Federal entity may charge to the federal award only allowable costs incurred during the period of performance and any costs incurred before the U.S. Department of Health and Human Services (HHS) awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity. Funds available to pay allowable costs during the period of performance include both federal funds awarded and carryover balances. In addition, a non-Federal entity must liquidate all obligations incurred under the award not later than 90 days after the end of the funding period. This deadline may be extended with prior written approval from the HHS awarding agency. Condition: Of nineteen expenditures tested, aggregating of $138,858 of a total population of $1,970,581, the following deficiency was noted: 1. For one (or 5%), the cancelled check for Document Number 1479917 (Business Unit H9243B, dated 09/30/19) amounting to $10,000 was not provided; accordingly, CHCC was not able to substantiate that the payment was liquidated within the grant award’s 90 days liquidation period, for which the amount is questioned. 2. For seven (or 37%), expenditures were liquidated after the liquidation period end date of 12/29/18. Finding No.: 2019-010, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Condition, continued: 3. For two (or 11%), expenditures were incurred/obligated after the obligation periods. No questioned costs are presented as amounts are questioned at Condition 1 for Document Number 1479917 and at Condition 2 for Document Number 1428464. 4. For one (or 5%), the transaction pertains to indirect costs charges for which the expenditure was charged to the Program after the 90 days liquidation period end date of 12/29/18. Finding No.: 2019-010, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Condition, continued: Of five subsequent expenditures tested, aggregating $2,486 of a total population of $6,362, the following deficiencies were noted: 5. For one (or 20%), the supporting documents were not provided. Accordingly, CHCC was not able to substantiate that the expenditure was incurred/obligated within the period of performance end date of 09/29/19 and was liquidated within the liquidation period end date of 12/29/19. 6. For two (or 40%), expenditures were liquidated after the liquidation period end date of 12/29/19. Cause: CHCC did not enforce recordkeeping and monitoring controls over compliance with applicable period of performance requirements. Finding No.: 2019-010, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Effect: CHCC is in noncompliance with applicable period of performance requirements and questioned costs of $97,710 result. Recommendation: Responsible CHCC personnel should establish recordkeeping system whereby underlying support for each transaction is substantiated and filed and enforce monitoring control over compliance with applicable period of performance requirements. Views of Responsible Officials: CHCC’s Corrective Action Plan provides a detailed rationale for disagreement with the finding described in Conditions 1 to 4 and 6 and states agreement with Condition 5; however, disagrees with the questioned costs. Auditor Response: Condition 1 - The cancelled check was not provided. Condition 2 - Check clearance dates were after the liquidation period end date of 12/29/18. Condition 3 - Obligation period end dates were obtained from documentations provided by CHCC. Finding No.: 2019-010, continued Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Auditor Response, continued: Condition 4 - The indirect costs was charged to the Program on 12/31/18, which is after the period of performance end date of 12/29/18. Condition 5 - Questioned costs are warranted given the transaction tested was not supported with adequate documentations. Condition 6 - Expenditures were liquidated after the liquidation period end date of 12/29/19. In addition, initial draft reports were provided to CHCC on 09/06/24 and 09/24/24. It was also agreed during the 09/06/24 and 10/04/24 meetings for CHCC to provide corresponding underlying accounting records to resolve the finding; however, no documentations were provided within the agreed timeline. Accordingly, finding is sustained.

Corrective Action Plan

Finding No.: 2019-010 Federal Agency: U.S. Department of Health and Human Services CFDA Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Award Number: 1H79SM062879-01, 5U79SP020710-04 and 6U79SP020710-04M001 Area: Period of Performance Questioned Costs: $97,710 Contact Persons: Perlie Santos, Chief Financial Officer; Reyna Saures, CGC Director; Vincent Camacho, Grants Administrator; Laurie Deleon Guerrero, Travel Coordinator Corrective Action: Condition 1 CHCC does not concur with the findings and the $10,000 questioned costs. A copy of check 10980 dated 11/08/19 cleared the bank as of 11/25/2019 2019-010 Condition 1 Finding No.: 2019-010 Continued Condition 2 CHCC does not concur with the findings and the $47,963 questioned costs. Uniform Guidance §200.305 requires Non-Federal entities other than States, payment methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the Non-Federal entity whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means. CHCC believes we complied with this requirement as the check payments for the selected samples were issued before December 29, 2018. The Uniform Guidance allows for the timely issuance of checks to support compliance to Cash Management provisions. CHCC does not have control over the timeliness of vendors cashing the issued checks. Condition 3 CHCC does not concur with the findings and the questioned costs. The obligation of Payment Voucher 1479917 dated September 27, 2019, was through a memo payment OM 676292 obligated on March 1, 2019, and not September 29, 2019, as reported by the auditor. Below is the screenshot of the obligation. The obligation of Payment Voucher 1428464 dated September 29, 2018, was through Contract 650826 OC obligated on February 7, 2019 and not September 28, 2018 as reported by the auditor. Below is the screenshot of the obligation. Condition 4 CHCC does not concur with the findings and the questioned costs. The indirect cost was calculated from direct cost during the period of performance and within the period of liquidation. It was however, entered into the accounting system late. CHCC will ensure corrective actions for timeliness of accounting entries is implemented. The Director of Grants and Fiscal Integrity and Comptroller will monitor this process. Condition 5 CHCC concurs with the findings but not the questioned costs. Although it was not timely scanned and sent electronically to the Auditors, the supporting documents from Travel Authorization to Travel Voucher are readily available for testing. The travel was completed in May 2019, within the period of performance. With the implementation of the Munis Financial Information System in January 2023, CHCC is now able to electronically attach scanned supporting documents to the vouchers through the Tyler Content Manager (TCM). This will allow for audit testing to be done by providing auditors view only access to CHCC Financial Information System. Finding No.: 2019-010, Continued Condition 6 CHCC does not concur with the findings and the questioned costs. Although not timely scanned and sent electronically to the Auditors, the selected invoices for services are as follows: PV 1486136 - July 2019 Communications PV 1486138 – September 2019 Communications With the implementation of the Munis Financial Information System in January 2023, CHCC is now able to electronically attach scanned supporting documents to the vouchers through the Tyler Content Manager (TCM). This will allow for audit testing to be done by providing auditors view only access to CHCC Financial Information System. Proposed Completion Date: On-Going

Categories

Questioned Costs Subrecipient Monitoring Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles Period of Performance

Other Findings in this Audit

  • 507998 2019-004
    Material Weakness Repeat
  • 507999 2019-005
    Material Weakness Repeat
  • 508000 2019-006
    Material Weakness Repeat
  • 508001 2019-007
    Material Weakness Repeat
  • 508002 2019-008
    Material Weakness Repeat
  • 508003 2019-009
    Material Weakness
  • 508005 2019-011
    Material Weakness Repeat
  • 508006 2019-012
    Material Weakness Repeat
  • 508007 2019-013
    Material Weakness Repeat
  • 508008 2019-014
    Material Weakness
  • 508009 2019-015
    Material Weakness
  • 508010 2019-016
    Material Weakness Repeat
  • 1084440 2019-004
    Material Weakness Repeat
  • 1084441 2019-005
    Material Weakness Repeat
  • 1084442 2019-006
    Material Weakness Repeat
  • 1084443 2019-007
    Material Weakness Repeat
  • 1084444 2019-008
    Material Weakness Repeat
  • 1084445 2019-009
    Material Weakness
  • 1084446 2019-010
    Material Weakness
  • 1084447 2019-011
    Material Weakness Repeat
  • 1084448 2019-012
    Material Weakness Repeat
  • 1084449 2019-013
    Material Weakness Repeat
  • 1084450 2019-014
    Material Weakness
  • 1084451 2019-015
    Material Weakness
  • 1084452 2019-016
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
10.557 Wic Special Supplemental Nutrition Program for Women, Infants, and Children $3.68M
93.268 Immunization Cooperative Agreements $3.36M
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $1.97M
93.870 Maternal, Infant and Early Childhood Homevisiting Grant Program $865,589
93.104 Comprehensive Community Mental Health Services for Children with Serious Emotional Disturbances (sed) $763,992
93.982 Mental Health Disaster Assistance and Emergency Mental Health $613,302
93.116 Project Grants and Cooperative Agreements for Tuberculosis Control Programs $589,264
93.898 Cancer Prevention and Control Programs for State, Territorial and Tribal Organizations $544,042
15.875 Economic, Social, and Political Development of the Territories $533,528
97.032 Crisis Counseling $501,942
93.074 Hospital Preparedness Program (hpp) and Public Health Emergency Preparedness (phep) Aligned Cooperative Agreements $494,660
93.994 Maternal and Child Health Services Block Grant to the States $452,851
93.236 Grants to States to Support Oral Health Workforce Activities $331,358
93.217 Family Planning Services $272,252
93.251 Universal Newborn Hearing and Screening $269,168
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $258,698
93.959 Block Grants for Prevention and Treatment of Substance Abuse $233,626
93.165 Grants to States for Loan Repayment $125,000
93.945 Assistance Programs for Chronic Disease Prevention and Control $120,169
93.917 Hiv Care Formula Grants $115,562
93.958 Block Grants for Community Mental Health Services $110,106
93.110 Maternal and Child Health Federal Consolidated Programs $89,729
93.644 Adult Medicaid Quality: Improving Maternal and Infant Health Outcomes in Medicaid and Chip $86,496
93.069 Public Health Emergency Preparedness $69,626
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $66,588
93.377 Prevention and Control of Chronic Disease and Associated Risk Factors in the U.s. Affiliated Pacific Islands, U.s. Virgin Islands, and P. R. $65,865
93.314 Early Hearing Detection and Intervention Information System (ehdi-Is) Surveillance Program $64,766
93.504 Family-To-Family Health Information Centers $63,569
93.788 Opioid Str $57,326
93.150 Projects for Assistance in Transition From Homelessness (path) $53,208
93.912 Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement $46,310
93.991 Preventive Health and Health Services Block Grant $39,096
93.889 National Bioterrorism Hospital Preparedness Program $32,585
93.073 Birth Defects and Developmental Disabilities - Prevention and Surveillance $16,318
97.088 Disaster Assistance Projects $12,625
10.855 Distance Learning and Telemedicine Loans and Grants $6,162
93.817 Hospital Preparedness Program (hpp) Ebola Preparedness and Response Activities $4,921
93.103 Food and Drug Administration Research $4,911
10.578 Wic Grants to States (wgs) $3,323
16.575 Crime Victim Assistance $1,379