Finding 982450 (2023-004)

Cash Management Federal Department – U.S. Department of Health and Human Services Federal Award Identification Number and Year: NH75OT000024 and 2021 COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises, Federal Assistance Listing #93.391 County Department – Department of Public Health Finding 2023 – 004 CRITERIA Federal regulations (45 CFR Part 75.305) Payment. (b) (3) states that reimbursement is the preferred method when the requirements in paragraph (b) cannot be met, when the US Department of Health and Human Service (HHS) awarding agency sets a specific condition per Section 75.207 or when the non- Federal entity requests payment by reimbursement. When the reimbursement method is used, the HHS awarding agency or pass-through entity must make payment within 30 calendar days after receipt of the billing, unless the HHS awarding agency or pass-through entity reasonably believes the request to be improper. CONDITION During the current audit period, the Cook County Department of Public Health (DPH) did not adequately comply with its cash management requirements in accordance with federal regulations. CAUSE Based on discussions with management, the cause of this finding is due to 1) instances of misplaced and/or lost vendor invoices preventing them from submitting the invoice to Finance for processing, 2) lack of personnel resources and staff turnover resulting in invoice review, approval, and submission delays, 3) vendor/subrecipient contract execution delays, 4) delays in processing invoices due to verification of invoices for a) invoice date, b) description of services, c) amounts requested, d) allowability; if stated information is missing, then invoices are returned to the vendor, accordingly; if invoice submitted to DPH/Cook County Health (CCH) Finance, then the invoices are returned to the program staff. EFFECT The failure to pay each subrecipient for allowable costs within 30 days after receiving the subrecipient’s billing or payment request is a violation of federal regulations. This could impact the subrecipient’s ability to adequately perform its programmatic responsibilities under the program. QUESTIONED COSTS None. CONTEXT We noted DPH does not currently track the receipt date on invoices submitted by the subrecipients. As a result, we were unable to verify if payments to the subrecipients were made within 30 days after receipt of the subrecipient’s billing. To perform our testing, we utilized the invoice date on the billings provided by the subrecipients to determine if payments were made within the 30-day requirement. Specifically, during our test of 24 subrecipients’ expenditures, we noted 15 instances where payments to the subrecipients’ appear to be submitted late, ranging from 2 to 248 days late. IDENTIFICATION OF REPEATED FINDINGS None. RECOMMENDATION We recommend that DPH develop and implement procedures to ensure payments to subrecipients are made within 30 days after receipt of the subrecipients billing or payment request, as required. Also, we suggest DPH include a date stamp of the receipt date on each invoice to ensure compliance with the 30-day requirement. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The County agrees with the finding and recommendation. The County’s corrective action plan is on page 55.