Finding Text
Department of Health and Human Services
Federal Financial Assistance Listing #93.498
COVID‐19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution
Applicable Federal Award Number and Year – Period 4 TIN #426037888
Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Reporting
Significant Deficiency in Internal Control Over Compliance
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.
Condition: The Medical Center included expenses in the Department of Health and Human
Services (HHS) special report for Period 4 that were transcribed incorrectly or were preliminary
amounts instead of final expenses which caused the HHS special report to be inaccurate. In
addition, there was no evidence of formal review and approval over tracking of expenditures
that were claimed for the program. In addition, there was no evidence retained that the Medical
Center’s special reports submitted to the Department of Health and Human Services for Period 4
TIN #426037888 were reviewed or approved by an individual separate from the preparer prior
to submission.
Cause: The Medical Center did not have an internal control process in place to ensure
documentation of review and approval of the tracking of expenditures claimed under the
federal program and the reports submitted to the Department of Health and Human Services.
Effect: The lack of adequate policies governing review and approval increases the risk that
employees participating in the federal awards administration may not be able to detect and
correct noncompliance in a timely manner.
Questioned Costs: None over the $25,000 limit.
Context: A sample of 11 ($629,403) from a population of 24 items ($806,374) were tested for
activities allowed or unallowed and allowable costs/cost principles. Key line items were tested
on the Period 4 HHS special report.
Repeat Finding from Prior Years: Yes
Recommendation: We recommend the Medical Center enhance internal control policies to
ensure that formal documentation of review and approval is obtained and retained, and review
is thorough enough to catch mistakes.
Views of Responsible Officials: Management agrees with the finding.