Finding Text
Department of Health and Human Services
Federal Assistance Listing #93.498
COVID-19: Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution
Applicable Federal Award Number and Year – Period 1 TIN #770637498
Reporting
Material Weakness in Internal Control Over Compliance and Material Noncompliance
Criteria: 2 CFR 200.303(a) establishes 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. The Health System reported expenses based on specifically identified COVID related
expenses.
Condition: The Health System failed to provide an expense listing that supported the expenses included
within the HHS Special Report – Period 1 (Report). In addition, the Health System’s lost
revenue report did not reconcile to the Report and there was no evidence of review by
someone other than the preparer.
Cause: Internal controls in place did not ensure that all federal awards were supported and tracked
appropriately.
Effect: The lack of adequate policies governing review of the terms and conditions of the program,
and lack of review over Report preparation and submission increases the risk that
employees participating in the federal award administration may not be able to detect and
correct noncompliance in a timely manner. The Health System submitted the Report
without an accurate schedule to support the amount of expenses claimed.
Questioned Costs: None reported.
Context: Sampling was not used.
Repeat Finding
from Prior Years: No
Recommendation: We recommend that the Health System enhance internal control policies to ensure all
amounts reported and submitted to the federal agency are adequately documented and
supported We also recommend that the Health System enhance internal control policies to
ensure that the required reports are properly reviewed prior to submission to ensure all key
line items are necessary, correct, meet the requirements of the federal program, and are
properly recorded in the reports required to be submitted to the federal agency.
Views of Responsible
Officials: Management agrees with the finding.