Finding Text
Federal Program: Federal Financial Assistance Listing 93.498; US Department of Health and Human Services; Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution
Activities Allowed/Unallowed and Allowable Costs/Cost Principles
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 Hospital reported amounts in the reporting portal for information technology expenditures for Quarter 3 2022 in excess of amounts that are supported by audit evidence.
Cause: The Hospital did not have an effective internal control process in place to ensure review and approval of the expenses claimed under the federal program and to ensure the report submitted for Period 4 was accurate and in accordance with the terms and conditions of the federal award.
Effect: The reporting to HHS for Period 4 was considered incorrect. Amounts reported for information technology expenditures for Quarter 3 2022 did not agree to audit evidence provided by management.
Questioned Costs: None.
Context: Key line items were tested on the Period 4 HHS report.
Recommendation: We recommend that the Hospital enhance its existing internal control processes to ensure expenses reported to HHS are supportable by underlying audit evidence.
Views of Responsible Officials and Planned Corrective Actions: Management agrees with the noted finding. Management will continue to refine processes to more diligently review the reporting portal submission and underlying audit evidence to ensure the accuracy of calculations and amounts reported to HHS.