Finding Text
2 CFR § 300.1 states the Department of Health and Human Services adopts the Office of Management and Budget (OMB) Guidance in 2 CFR part 200, and has codified the text, with HHS-specific amendments in 45 CFR part 75. Thus, this part gives regulatory effect to the OMB guidance and supplements the guidance as needed for the Department.
2 CFR § 200.329(a) states the non-Federal entity is responsible for oversight of the operations of the Federal award supported activities. The non-Federal entity must monitor its activities under Federal awards to assure compliance with applicable Federal requirements and performance expectations are being achieved. Monitoring by the non-Federal entity must cover each program, function or activity.
45 CFR § 75.302(a) states each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's 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 general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Section (b) states, in part, the financial management system of each non-Federal entity must provide for the following:
(1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the CFDA title and number, Federal award identification number and year, name of the HHS awarding agency, and name of the pass-through entity, if any.
(2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 75.341 and 75.342.
(3) Records that identify adequately the source and application of funds for federally-funded activities. These records must contain information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation.
(4) Effective control over, and accountability for, all funds, property, and other assets. The non-Federal entity must adequately safeguard all assets and assure that they are used solely for authorized purposes.
(5) Comparison of expenditures with budget amounts for each Federal award.
(6) Written procedures to implement the requirements of § 75.305.
(7) Written procedures for determining the allowability of costs in accordance with subpart E of this part and the terms and conditions of the Federal award.
The COVID-19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution program is administered by the Health Resources and Services Administration (HRSA) and supports eligible health care providers in the battle against the COVID-19 pandemic by providing relief funds to eligible providers of health care services and support for health care-related expenses or lost revenues attributable to coronavirus. PRF recipients must only use payments for eligible expenses. 2022 OMB Compliance Supplement, Part 4, 93.498. Providers who accepted PRF and/or ARP payment(s) agreed to the Terms and Conditions of the program, which include a requirement to report on the use of the funds. See Reporting and Auditing, Health Resources & Services Administration, https://www.hrsa.gov/provider-relief/reporting-auditing. Entities receiving PRF funds are required to submit financial and other information in the Provider Relief Fund Reporting Portal. The PRF amounts to be reported on the County’s Schedule of Expenditures of Federal Awards (SEFA) are based on the PRF report. 2022 OMB Compliance Supplement. Reporting Entities are required to maintain adequate documentation to substantiate that the PRF funds were used for health care-related expenses or lost revenues that are attributable to coronavirus and COVID-19. See PRB Reporting and Auditing FAQ, Health Resources & Services Administration, https://www.hrsa.gov/provider-relief/faq/reporting?categories=210&keywords= .
Logan County Logan Acres Care Center Department (the Center) completed and submitted its PRF report based solely on the amounts received; however, the Center did not submit and maintain detailed, complete financial records on the actual expenditures of the PRF funds. As a result, the exact expenditures associated with the grant were unidentifiable which was contrary to the requirements imposed on recipients of PRF funds.
Logan County Logan Acres Care Center Department should implement procedures to verify grants are separately accounted for with respect to receipts and expenditures. Failure to maintain detailed financial records can result in unallowable federal grant expenditures and/or reimbursements to the grantor.