Finding Text
Finding No. 2020-002 – Reporting
Federal Program
Assistance Listing 21.019 - Coronavirus Relief Fund – COVID - 19
Name of Federal Agency
U.S. Department of Treasury
Pass-through entity
Puerto Rico Treasury Department
Category
Significant deficiency in internal controls over compliance / Non-compliance
Compliance requirements
Reporting
Criteria
As stated in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance), § 200.303 Internal controls, “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).
(b) Comply with the U.S. Constitution, Federal statutes, regulations, and the terms and conditions of the Federal awards.”
In addition, the grant agreement establishes in its Exhibit A of the AAFAF guidelines, Grant Plan, Reporting, the following: “By the 15th day of each month, the Grantee will submit a Use of Funds Grant Report for the prior month’s expenses. The financial report will provide a detailed explanation of how the Grant funds were spent.”
Condition
Our audit procedures revealed instances where reports required to be filed under the grant agreement were either not filed at all or filed after the due date. The Hospital did not provide evidence of the June 2020 and July 2020 filling submission. Also, the expenses reports related to November 2020 and December 2020 were submitted on December 30, 2020 (15 days later) and February 5, 2021 (21 days later, respectively).
Cause
The Hospital did not perform effective monitoring for the compliance with the deadlines of reports submission and also, did not had adequate internal controls for the recordkeeping of reports submissions.
Effect
The Hospital did not submit, or did not submit on time, the financial reports that provide a detailed explanation of how the grant funds were spent and the timing of the expenditures. The analysis, evaluations, and decision-making of the grantee could be affected.
Questioned cost
None.
Context
As part of the reporting (timing) test, we examined eight (8) submission dates required, which represent the 100% of submissions required for the year for the Coronavirus Relief Fund and observed that two (2) of the Use of Funds Grant Reports were submitted after their respective due dates and evidence of submission for other two (2) Use of Funds Grant Reports could not be obtained.
Identification of a repeat finding
This is not a repeat finding.
Views of responsible officials and planned corrective actions
The Hospital’s management and responsible officers agree with this finding. Please refer to the corrective action plan section for the Hospital’s response on pages 57 to 59.