Finding 960502 (2023-001)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2023
Accepted
2024-03-25

AI Summary

  • Core Issue: There is a significant deficiency in internal controls over payroll compliance, specifically the lack of documented approval for corrected time cards.
  • Impacted Requirements: The Medical Center failed to meet the standards set by 2 CFR 200.303 and 2 CFR 200.430(i) for managing federal awards effectively.
  • Recommended Follow-Up: Implement a process for supervisor approval of all timesheets, including corrections, before payroll submission, ensuring documentation is maintained.

Finding Text

Finding 2023‐001: Significant Deficiency, Internal Control Over Compliance Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.498 – COVID‐19 Provider Relief Fund (PRF) and American Rescue Plan (ARP) Rural Distribution Award Year: 2021 Federal Award Identification: PRF 20210001 Pass‐Through Entity: N/A Criteria: Per 2 CFR 200.303 and 2 CFR 200.430(i), a non‐federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and terms and conditions of the Federal award and establishes the standard for documentation of personnel expenses. Condition: Payroll expenses are an allowed expense according to the guidance and FAQs generated by HRSA. The Medical Center should have controls in place whereby all expenses are reviewed prior to submission to ensure the expense is for the proper purpose. Cause: There was no policy implemented to require the documented approval of a corrected time card. Effect: For one of twenty‐five payroll expenses selected, there was no approval of a corrected time card prior to the payroll being submitted. Questioned Costs: $‐0‐ Perspective: The payroll expense was an allowable costs under the guidance issue by HHS. This finding does not generate any questioned costs or unallowable costs being used in the PRF submission. Recommendation: We recommend the Medical Center implement a process whereby all timesheets (original and corrected) have to be approved by a supervisor prior to payroll being generated and that approval is documented and maintained. Views of Responsible Officials and Planned Corrective Action: Management concurs with auditors’ finding and recommendation. Management’s Response: See attached corrective action plan.

Categories

Allowable Costs / Cost Principles

Other Findings in this Audit

  • 384060 2023-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.766 Community Facilities Loans and Grants $55.63M
93.498 Covid-19 Provider Relief Fund and American Rescue Plan (arp) Rural Distribution $9.83M