Finding 523313 (2024-001)

Material Weakness in Internal Control over Federal Programs Inadequate Internal Controls over Financial Management in Accordance with the Uniform Guidance – Reporting Review and Approval Assistance Listing Number: 93.129 Name of Federal Program or Cluster: Technical and Non-Financial Assistance to Health Centers Name of Federal Agency: Department of Health and Human Services Name of Pass-Through Entities: N/A WI DHS Contract Number: 435100-G24-226233-490 Profile ID #: 155043 Name of State Program: WI Primary Care 2 CFR §200.302 Financial Management: The Code of Federal Regulations (CFR) Section 200.302 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. - All recipient and subrecipient financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal Award, must be sufficient to permit the preparation of reports required by the terms and conditions; and tracking expenditures to establish that funds have been used in accordance with Federal Statutes, regulations, and the terms and conditions of the Federal Award. -Maintaining records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal Awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. All records must be supported by source documentation. The State Award is passed through from the Federal government and is required to follow the Uniform Guidance as well. Management’s grant tracking for Federal Awards were not properly updated or reviewed and approved during the year. Due to staff turnover during the year, Management was unable to provide the general ledger information that reconciles to the grant cost reimbursement requests submitted to the funding sources. In addition, Management was unable to provide supporting documentation that information submitted to the funding sources was reviewed and approved. There is an increased risk that the Organization could potentially charge unallowable costs to Federal or State Awards. In addition, there is an increased risk that a material misstatement of the financial statements or the Schedule of Expenditures of Federal Awards may not be prevented, or detected and corrected, in a timely manner. WHPCA hired a new third party accountant after the end of the fiscal year and has been working with the new accountant to implement additional monitoring and review and approval procedures. We recommend that WHPCA continues this process to strengthen its internal controls. No Staff at WHPCA are dedicated to adhering to the regulations. WHPCA has hired a third-party accountant as well as implemented additional monitoring and review and approval procedures to strengthen its financial management.