FAC Explorer

Finding 515081 (2023-001)

Material Weakness Repeat Finding
Requirement
Allowable Costs/Cost Principles
Questioned Costs
-
Year
2023
Accepted
2024-12-17
Audit: 333141
Organization: Shalom Health Care Center, Inc. (IN)
Auditor: Greenwalt CPAS INC

AI Summary

  • Core Issue: The Organization lacks a reliable financial management system to track and report federal award expenditures accurately.
  • Impacted Requirements: This violates 2CFR200.302(b), which mandates complete and accurate financial disclosure for federal awards.
  • Recommended Follow-Up: Implement stronger accounting controls and oversight to ensure proper tracking and reporting of all grant-related expenses.

Finding Text

Finding 2023-001, Material Weakness - Allowable Costs and Cash Management Identification of federal program : U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES 93.224 and 93.527 Health Center Program Cluster Criteria: 2CFR200.302(b) requires federal award recipients to maintain a financial management system that provides for the identification of all federal awards received and expended as well as accurate, current and complete disclosure of the financial results of each federal award program in addition to comparison of expenditures with budget amounts for each federal award. Condition: The Organization was unable to generate reports from its accounting system detailing expenditures incurred by federal award. In addition, the Organization was also unable to provide reports distinguishing federal award expenditures from non-federal award expenditures. Effect: Management drew down federal funds based on payroll estimations. Payroll expenses had to be manually compiled for the entire year to substantiate personnel costs charged to all grants. Management created spreadsheets to identify the details of non-payroll expenditures incurred under federal awards. Cause: A significant amount of payroll and other expenses were not coded to grants within the accounting system. Time records and invoices allocated to specific grants were not entered into the accounting system under the actual account segment for the funding source and were left in the general operating fund. Staff turnover in the fiscal department contributed to the breakdown in internal controls and process. Questioned costs: None Repeat finding: Yes Recommendation: We recommend that the Organization implement accounting processes and controls over financial reporting to ensure accurate financial reporting. Oversight responsibilities should include review of financial reporting by grants (segments) to verify proper posting and allocation of costs. Views of responsible officials and planned corrective actions: See attached corrective action plan.

Corrective Action Plan

The following steps have been taken or will be taken to address Finding 2023-001: Shalom Health Care Center, Inc. has made some changes in how the draws are done with each payroll versus previously per month. Shalom has also hired new staff to help keep up with the grants and payrolls and entering data into the accounting system, as we had previously had turnover and were using temp services for some of the prior year. Contact Person: Michael A. Nino, Chief Financial Shalom Health Care Center, Inc. anino@shalomhealthcenter.org 317-269-7198

Categories

Allowable Costs / Cost Principles Internal Control / Segregation of Duties Cash Management Material Weakness Reporting Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 515082 2023-001
    Material Weakness Repeat
  • 515083 2023-001
    Material Weakness Repeat
  • 515084 2023-001
    Material Weakness Repeat
  • 515085 2023-001
    Material Weakness Repeat
  • 515086 2023-003
    Significant Deficiency
  • 515087 2023-003
    Significant Deficiency
  • 515088 2023-003
    Significant Deficiency
  • 515089 2023-003
    Significant Deficiency
  • 515090 2023-003
    Significant Deficiency
  • 515091 2023-004
    Material Weakness
  • 515092 2023-004
    Material Weakness
  • 515093 2023-004
    Material Weakness
  • 515094 2023-004
    Material Weakness
  • 515095 2023-004
    Material Weakness
  • 1091523 2023-001
    Material Weakness Repeat
  • 1091524 2023-001
    Material Weakness Repeat
  • 1091525 2023-001
    Material Weakness Repeat
  • 1091526 2023-001
    Material Weakness Repeat
  • 1091527 2023-001
    Material Weakness Repeat
  • 1091528 2023-003
    Significant Deficiency
  • 1091529 2023-003
    Significant Deficiency
  • 1091530 2023-003
    Significant Deficiency
  • 1091531 2023-003
    Significant Deficiency
  • 1091532 2023-003
    Significant Deficiency
  • 1091533 2023-004
    Material Weakness
  • 1091534 2023-004
    Material Weakness
  • 1091535 2023-004
    Material Weakness
  • 1091536 2023-004
    Material Weakness
  • 1091537 2023-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
93.224 Community Health Centers $1.04M
93.242 Mental Health Research Grants $124,057
93.940 Hiv Prevention Activities Health Department Based $40,000
93.526 Fip Verification $13,581
93.527 Affordable Care Act (aca) Grants for New and Expanded Services Under the Health Center Program $5,172