Finding Text
Department of Housing and Urban Development Federal Assistance Listing/CFDA #14.128 Section 242 ? Mortgage Insurance - Hospitals 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 federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Condition: The Organization?s third quarter report submitted to the Department of Housing and Urban Development (HUD) under reported Other Operating Revenue. Cause: The Organization did not have a control process in place to ensure the report submitted to HUD agreed to their internal financial statement. Effect: The Organization understated Other Operating Revenue in a quarterly report making the report inaccurate. Questioned Costs: None reported. Context: There were a total of eight reports required to be submitted for the year ended December 31, 2022. Three were selected for testing. Of the three selected, one had errors. Through review of a subsequent quarterly report, it was noted that the incorrect line item had been corrected during the year. Repeat Finding from Prior Years: No Recommendation: We recommend the Organization implement a control process which includes a secondary review and approval of the required reports to be submitted to the federal agency be completed after they have been entered into HUD?s format. Views of Responsible Officials: Management agrees with the finding. We will follow our policy of ?Review of Reports Filed with Federal Agencies? as a control over reporting and compliance.