Finding 972301 (2022-004)

Department of Health and Human Services Federal Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Periods 3 & 4 TIN #88‐0065829 Allowable Costs and Activities Material Weakness in Internal Control Over Compliance Criteria ‐ The Hospital must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Hospital is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Condition – The Hospital opted for a budget to actual comparison for the calculation of lost revenue as an alternate reasonable methodology, however the actual amounts used did not consider adjustments during the fiscal year. Cause ‐ The Hospital did not have an internal control process in place to ensure the accuracy of the calculation and excluded adjustments to revenue. Effect – There was no effect on the amount of lost revenue applied against the funding received. Questioned Costs ‐ None reported. Context – The lost revenue calculation for all applicable quarters was tested and reviewed. Repeat Finding from Prior Years ‐ Yes Recommendation ‐ We recommend that management review the calculation methodology for lost revenues and ensure the amounts used for actual revenues agrees to the amounts presented in the financial statements. Views of Responsible Officials ‐ Management agrees with the finding.