Finding 975619 (2022-004)

FINDING 2022-004 Subject: COVID-19: Coronavirus State and Local Fiscal Recovery Funds - Reporting Federal Agency: Department of the Treasury Federal Program: COVID-19: Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 400ARPHLTHISSCH Pass-Through Entity: Indiana Department of Health Compliance Requirement: Reporting Audit Finding: Material Weakness INDIANA STATE BOARD OF ACCOUNTS 22 ELKHART COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Condition and Context The Elkhart County Health Department (Health Department) was awarded the Health Issues and Challenges Grant (grant) through the Indiana Department of Health (IDOH). The grant was funded through the American Rescue Plan Act (ARPA) that focused on the improvement of chronic disease, and more specifically, elevated blood lead level reduction. The Health Department was required to submit data through the online portal, the National Electronic Disease Surveillance System (NEDSS) Base System (NBS), each month beginning in October 2022. The submitted data included program specific metrics related to patient case management of certified elevated blood lead levels. A Case Manager managed all aspects of an individual patient's care. A home visit and two assessments were completed by the Case Manager and input into the NBS. Once these steps were marked as complete in the NBS, the Clinical Manager reviewed each case and compiled data along with the cost reimbursement amount into a spreadsheet. The Clinical Manager provided the spreadsheet to the Manager of Administration who then completed and submitted the reimbursement invoice to the IDOH. The reimbursement invoice was submitted without a documented oversight, review, or approval process to ensure the accuracy of the data prior to submission. The lack of internal controls was a systemic issue throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) 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 the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." Cause A proper system of internal controls, which would include segregation of key functions, was not designed by management of the County to ensure the accuracy of the reimbursement invoices. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. INDIANA STATE BOARD OF ACCOUNTS 23 ELKHART COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the County establish a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place to ensure reimbursement invoices are complete and accurate prior to submission. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report. Auditor's Response While a segregation of duties existed within the process, a review or evaluation of data was never completed to ensure the data as compiled and entered was accurate and complete. The state's reviewal process prior to funds being disbursed to the County is a part of the state's internal control system, not the County's internal control system. We reaffirm our finding and will review the status of the finding during our next audit.