Finding Text
2022-001 - Significant Deficiency in Internal Control - Review and Approval of Allowable Costs Federal Program: COVID-19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: N/A Award Number: N/A Award Year: 2020 and 2021 Compliance Requirement: Allowable Cost/Cost Principles and Activities Allowed or Unallowed Questioned Costs: None noted Criteria: Nonfederal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition and Context: During the testing of expenditures related to increased nurse agency costs and benefits allocation calculations, we observed that for 2 of the 2 calculations tested did not contain a review and approval prior to submission to detect potential errors in the calculations. Effect: The Corporation lacks proper documentation of review with respect to the calculations of increased nurse agency costs and benefits allocations, which could result in errors in these calculations. As a result of the lack of proper documentation of review, noncompliance due to error or fraud could occur without being detected and corrected timely. Cause: The Corporation lacks a formal review policy related to the calculations of increased nurse agency costs and benefits allocations. Recommendation: Management should implement and document a review process for these calculations. View of Responsible Officials: Beginning with reporting period 4, the Organization will begin formally documenting the review of all calculations as part of the submission review process.