Finding Text
2022-003 Department of Health and Human Services Federal Assistance Listing/CFDA #93.498 COVID-19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year ? Period 2 TIN #463364672, Period 2 TIN #272608086, Period 2 TIN #410721640, Period 2 and Period 3 TIN #450275011, Period 2 and Period 3 TIN #204531061 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.33(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 statues, regulations, and conditions of the federal award. The Organization is required to submit an accurate report to HHS for each filing period of funds were received. Condition: The Organization claimed lost revenues attributable to coronavirus in which the final lost revenue calculation did not tie to the HHS Report. Cause: The Organization had a lost revenue calculation error of $141,573 on the HHS special report causing a difference to the actual lost revenues (i.e. there were more lost revenues reported on the HHS special report). Effect: While the calculation error provided a difference between the lost revenues on the HHS special report and the lost revenue calculation, the Organization had excess lost revenues available to be applied to future periods. This calculation error also indicated there is a lack of policies governing the review and approval of the lost revenue calculation to the HHS special report. Questioned Costs: None reported. Context: The HHS special reports included total lost revenue calculation errors of $141,573. For the TINs that had lost revenue calculation errors, excess amounts of lost revenues consist of: TIN #463364672, excess lost revenues of $885,328 (error had no impact on lost revenue amount calculated); TIN #410721640, excess lost revenues of $3,189,219 (after error ? error decreased amount of excess lost revenue); TIN #272608086, excess lost revenues of $3,236,647 (after error ? error decreased amount of excess lost revenues);TIN #450275011, excess lost revenues of $700,778 (after error ? error increased amount of excess lost revenues); and TIN #204531061, excess lost revenues of $1,038,908 (error in Report 2, corrected on Report 3). Repeat Finding from Prior Years: No Recommendation: We recommend that the Organization enhance internal control policies to ensure the HHS special report is supported by accurate lost revenue calculations. This would include implementing a secondary review and approval over the lost revenue calculation. Views of Responsible Officials: Management agrees with the finding.