Finding 950808 (2023-004)

Material Weakness
Requirement
AB
Questioned Costs
-
Year
2023
Accepted
2024-03-07

AI Summary

  • Core Issue: The Hospital's financial reporting for the COVID-19 Provider Relief Fund lacks alignment with supporting documentation due to turnover in key financial roles.
  • Impacted Requirements: Internal controls over compliance, as outlined in 2 CFR 200.303(a), were not effectively maintained, increasing the risk of incorrect reporting.
  • Recommended Follow-Up: Strengthen documentation processes for final expenditure listings to ensure accurate claims under the federal program.

Finding Text

Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID-19 Provider Relief Fund and American Rescue Plan Applicable Federal Award Number and Year – Period 4 TIN #860107344 Activities Allowed/Allowable Costs Material Weakness 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’s expenditures identified as eligible and claimed under the Provider Relief Fund program did not agree to the underlying detail listing. The current key financial personnel were unable to reconcile the differences between the support and the amounts reported. Cause: There was turnover in key financial positions. The established internal controls did not ensure the underlying detail supported expenditures identified as eligible and claimed. Effect: The lack of adequate policies governing report preparation and submission increases the risk that the report could be filed incorrectly. Questioned Costs: None reported relating to Period 4 as total eligible expenditures on the underlying detail listing exceeded amount of Period 4 funds received. Context: A total non-statistical sample of 60 transactions were tested which accounted for $2,558,991 of $3,645,080 identified on the detail listing. This exceeded the $2,074,204 of funds received in Period 4. Repeat Finding from Prior Years: No. Recommendation: We recommend that the Hospital strengthen the control process for maintaining documentation of the final expenditure listing used to claim the allowable costs under the federal program. Views of Responsible Officials: Management agrees with the finding.

Categories

Allowable Costs / Cost Principles Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

  • 374365 2023-003
    Material Weakness Repeat
  • 374366 2023-004
    Material Weakness
  • 374367 2023-005
    Material Weakness
  • 374368 2023-006
    -
  • 950807 2023-003
    Material Weakness Repeat
  • 950809 2023-005
    Material Weakness
  • 950810 2023-006
    -

Programs in Audit

ALN Program Name Expenditures
10.766 Community Facilities Loans and Grants $3.88M
93.498 Provider Relief Fund $2.07M