Finding Text
Department of Health and Human Services Federal Financial 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# 455563741
Reporting
Material Weakness in Internal Control over Compliance and Material Noncompliance
Criteria: Confluence Health must establish and maintain effective internal control over federal awards that provides reasonable assurance that Confluence Health is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award.
Condition: Confluence Health selected option ii to calculate lost revenue which consists of a comparison of actual results during the period of availability to a budget approved before March 27, 2020, for the entire period of availability. The budget used in the calculation of lost revenue was not approved for the entire period of availability. The budget used to cover quarters in 2021 and 2022 was not approved prior to March 27, 2020.
Cause: Confluence Health did have an approved budget prior to March 27, 2020, for calendar year 2020, but the approved budget did not cover the entire period of availability.
Effect: The reporting to HHS for Period 4 was considered incorrect. Confluence Health did not have a budget approved prior to March 27, 2020 for the entire period of availability. There was no effect on the amount of lost revenue applied against the funding received, however there were errors in the key line items reported.
Questioned Costs: None reported.
Context: Key line items were tested on the Period 4 Department of Health and Human Services special report.
Repeat Finding from Prior Years: No
Recommendation: We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements.
Views of Responsible Officials: Management agrees with the finding.