Finding Text
U.S. Department of Agriculture Direct Program: Community Facilities Loans and Grants Cluster - 10.766 Criteria or Specific Requirement - Management is responsible for reporting back to the USDA throughout the life of the loan, as specifically requested within the Hospital's applicable agreement, via the RD 442-2, Statement of Budget, Income, and Equity report, as well as the RD 442-3 , Balance Sheet report. Condition - The Hospital failed to submit its required quarterly reports back to the USDA. Questioned Costs - N/A Context - Out of a population of 8 required quarterly reports (4 RD 442-2 quarterly reports and 4 RD 442-3 quarterly reports), we sampled 4 for testing. Upon making selections and through discussions with management, it was determined none of the required reports were submitted throughout the year. The sample was not, and was not intended to be, a statistically valid sample. Effect - The hospital did not follow the guidelines as laid out in the respective loan agreement for its reporting requirements. Cause - These reports are required to be submitted, as laid out in the applicable loan agreement, however, management did not maintain a list of required reports to be submitted nor was there a tracking mechanism in place to ensure timely filing. Additionally, the reports were never specifically requested throughout the year by the Hospital's USDA representative, nor was the hospital notified of its tardy submission at any point during the fiscal year. Identification as a Report Finding - Not applicable. Recommendation - The Hospital should continue to improve its understanding of the reporting requirements as laid out in the applicable loan document and create a tracking mechanism to ensure reports are submitted in a timely fashion moving forward. View of Responsible Official and Planned Corrective Actions - The Hospital agrees with this finding and will evaluate processes and implement controls surrounding the reporting requirements as laid out by the USDA in the Hospital's loan agreement. The CFO will ultimately be responsible for submitting these reports, as requested.