UNITY HEALTH CARE, INC.

Criteria: In accordance with 2 CFR Section 200.430(g)(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430(g)(1)(vii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented. Condition: During our testing of salaries and wages, we noted that all 182 sampled transactions did not include detail by program. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system…

Corrective action: Management Response #2024-001: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the finance department manually calculated salary allocations. Due to the influx of grants and staffing resources the Corporation was unable to maintain this process. Corrective Action Plan: Finance Management, Human Resources, and Payroll will collaborate to integrate time-tracking functionality into the current timekeeping system, enabling real-time tracking of time worked on grants for FY25. The rollout of this new process is expected to begin in Q4 of FY25. Responsible Party: Tamara Barnes, CFO

Criteria: In accordance with 2 CFR Section 200.431(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees. Condition: During our testing of fringe benefits expenses, we noted that all 182 sampled transactions did not include detail by program. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements. Cause:The Co…

Corrective action: Management Response #2024-002: Due to the financial system and time keeping infrastructure, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Also, the current fringe cost rate and allocations is based on historical assumptions. Corrective Action Plan: • The finance team will work to ensure fringe costs are entered into the financial system based on actual costs paid by the Corporation for each employee. • The grants finance department will also create actual to budget reports in accordance with HRSA guidelines for fringe costs • The Finance Team will develop fringe costs reports to calculate, monitor and support the current rate. This will allow us…

Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”. During our testing of procurement, the Corporation was unable to provide evidence to support that a competitive price analysis for 1 vendor out of the 3 samples. Additionally, per management, no written documentation can be provided for any sole source procurements. Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors, as required by the gener…

Corrective action: Management Response #2024-003: Previously, the Corporation faced challenges in effectively monitoring and documenting grant activity due to limited formal processes. Documentation of policies and procedures was insufficient, and supporting materials were not stored in a centralized location, making information retrieval difficult. Since then, processes have improved, with enhanced documentation practices and better organization of grant-related records to support more efficient oversight and compliance. Corrective Action Plan: The Corporation has implemented the following corrective measures: • The Corporation established comprehensive, formal policies and procedures that document the curre…

Criteria: Applicants for WIC program benefits are screened at WIC clinic sites to determine their WIC eligibility. To be certified eligible, they must meet the eligibility criteria defined at 7 CFR sections 246.7(c), (d), (e), (g), and (l) related to Category, Identity and Residency, Income, and Nutritional Risk. Condition: During our testing of eligibility, the Corporation was unable to provide support that eligibility assessments performed were reviewed. For 2 of the 40 samples, proper segregation of duties was not maintained as the staff person who determined income eligibility was the same staff person who completed the medical risk assessment. Cause: The staff did not consistently follow formal policies and procedures over eligibility. Effect or Potential Effect: Lack of strict adherence to documentation requirements may have resulted in the Corporation providing benefits to inel…

Corrective action: Management Response #2024-004: Due to staff turnover, the Corporation did not consistently enforce segregation of duties between the individual responsible for determining income eligibility and the one completing the medical risk assessment. Corrective Action Plan: All eligibility verification data, including screenshots and signed Rights and Obligations statements, will be stored in a centralized, secure shared drive maintained and managed by the WIC Director to ensure it is protected with limited access and password protection. The drive will be organized using a de-identified naming convention to ensure privacy while maintaining ease of access for authorized staff. To maintain a robu…

Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs. Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain ongoing supporting documentation of eligib…

Corrective action: Management Response #2024-005: Due to staff turnover the Corporation did not have adequate personnel or infrastructure in place to monitor costs in order to calculate and determine an updated indirect cost rate. Also, the current indirect cost rate allocations is based on historical assumptions. Corrective Action Plan: The Finance Team will develop overall operational costs reports to calculate and support a new rate. The proposed rate will be submitted to HRSA for approval. This will allow us to ensure the calculation for indirect costs and documentation supporting the indirect cost pool conform to the current regulations. Management expects to be completed by December 31, 2026. Respon…

Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA. Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2023, were not filed by the deadline of September 30, 2024, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared. Cause: The Corporation did not have a formal process in place during the year ended December 31, 2023, to accurately, completely, and timely prepare the SEFA. Effect or Potential…

Corrective action: Management Response #2023-004: Due to staffing shortages and turnover, the company lacked sufficient personnel to adequately monitor or document grant activities which led to the delay in timely filing of the audit with the Federal Audit Clearinghouse. Corrective Action Plan: The following actions have been implemented to address the issue: • The finance team redefined and expanded roles to designate specific staff members whose primary responsibility is to monitor and manage all grant activities. • The finance team developed Project Budget Reports for each federal award. These reports include a detailed budget, monthly expenses, and monthly revenue (drawdowns). The reports will be reviewed…

Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented. Condition: During our testing of salaries and wages, we noted that all 174 sampled transactions did not have adequate supporting documentation. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use…

Corrective action: Management Response #2023-005: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the finance department manually calculated salary allocations. Due to the influx of grants and staffing resources the Corporation was unable to maintain this process. Corrective Action Plan: The following action items have been or will be taken: • Finance Management, Human Resource and Payroll will work on integrating time-tracking functions with the current time-keeping system to specifically track time worked on grants in real time for fiscal year 2025. Responsible Party: Tamara Barnes, CFO

Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees. Condition: During our testing of fringe benefits expenses, we noted that all 174 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.…

Corrective action: Management Response #2023-006: Due to the financial system and time keeping infrastructure, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Also, the current fringe cost rate and allocations is based on historical assumptions. Corrective Action Plan: • The finance team will work to ensure fringe costs are entered into the financial system based on actual costs paid by the Corporation for each employee. • The grants finance department will also create actual to budget reports in accordance with HRSA guidelines for fringe costs. • The Finance Team will develop fringe costs reports to calculate, monitor and support the current rate. This will allow us…

Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”. Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance. Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs ar…

Corrective action: Management Response #2023-007: Due to staff shortages and turnover, the company lacked adequate personnel to effectively monitor or document grant activity. Additionally, formal documentation of policies and procedures was insufficient, and supporting documents were not stored in a centralized location, creating challenges in retrieving necessary information. Corrective Action Plan: In response to these issues, the company implemented the following corrective measures starting in mid-2023: • The Corporation established comprehensive, formal policies and procedures that document the current compliance practices. These procedures have been disseminated across the organization and incorporated…

Criteria: Applicants for WIC program benefits are screened at WIC clinic sites to determine their WIC eligibility. To be certified eligible, they must meet the eligibility criteria defined at 7 CFR sections 246.7(c), (d), (e), (g), and (l) related to Category, Identity and Residency, Income, and Nutritional Risk. Condition: During our testing of eligibility, the Corporation was unable to provide support that eligibility assessments performed were reviewed. Below is a summary of our findings: • For 1 of the 40 samples, proper segregation of duties was not maintained as the staff person who determined income eligibility was the same staff person who completed the medical risk assessment. • For 3 of the 40 samples, the Corporation was unable to provide support to verify the applicant signed the Rights and Obligations statement. • For all 40 samples, the Corporation was unable to provide su…

Corrective action: Management Response #2023-008: Due to staff turnover, the Corporation did not consistently enforce segregation of duties between the individual responsible for determining income eligibility and the one completing the medical risk assessment. The Corporation also failed to provide sufficient support to verify that the applicant signed the Rights and Obligations statement. Corrective Action Plan: • All eligibility verification data, including screenshots and signed Rights and Obligations statements, will be stored in a centralized, secure shared drive maintained and managed by the WIC Director to ensure it is protected with limited access and password protection. The drive will be organized …

Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs. Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related…

Corrective action: Management Response #2023-009: Due to the staff shortages and turnover the Corporation did not have adequate personnel or infrastructure in place to monitor costs in order to calculate and determine Corrective Action Plan: The Finance Team will develop overall operational costs reports to calculate and support a new rate. The proposed rate will be submitted for approval. This will allow us to ensure the calculation for indirect costs and documentation supporting the indirect cost pool conform to the current regulations. Responsible Party: Tamara Barnes, CFO

Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA. Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared. Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA. Effect or Potential…

Corrective action: Management Response #2022-004: Due to staff shortages and turnover in FY2020-21 and continuing into FY2022, the company did not have adequate personnel in place to properly monitor or document grant activity. Formal documentation of policies and procedures were also deficient. Corrective Action Plan: The following action items have been established. • In 2022, the finance team delineated and expanded positions whose primary responsibility is to monitor and manage all grant activities. • In 2022 Project Budget Reports have been created for each federal award. These reports include the budget, expenses foreach month and the revenue (drawdown) incurred foreach month. The reports will be review…

Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented. Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allo…

Corrective action: Management Response #2022-005: The time keeping system and process does not currently allow tracking of time based on funded resources. The past practice had been for the finance department manually calculated salary allocations but due to staff turnover in FY2021-22, the process was not consistently followed. Corrective Action Plan: The following action items have been or will be taken: • In 2022, the finance team delineated and expanded positions whose primary responsibility is to monitor and manage all grant activities. • Monthly time and effort reports to include recorded time worked under each grant will be sent to the employee and require employee and supervisor approval. • As of 2022…

Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees. Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.…

Corrective action: Management Response #2022-006: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Corrective Action Plan: Due to the staff turnover and shortage in 2020-2021, this process was not consistently maintained or documented. The following action items have been or will be taken: • In 2022, finance team delineated and expanded positions whose primary responsibility is to monitor and manage all grant activities. • The grants finance department will also create actual to budget reports in accordance with HRSA guidelines for fringe costs. • The report will be reconciled monthly based on fringe co…

Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed. Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency. Cause: The Corporation did not have formal policies and procedures over reporting. Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate. Questioned costs: None Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financia…

Corrective action: Management Response #2022-007: The pandemic and subsequent shift to remote work saw a disruption on the previous workflow of reviewing and approval of federal programs financial reports prior to submission to the granting agency. Staff turnover in key financial positions also contributed to the departure in following the processes that were in place and I sufficiently documented. This practice continued into FY2021 which also had similar issues. Corrective Action Plan: In FY2022, the following steps were implemented to ensure there is proper review and approval of reports required under the federal programs prior to submission. • The Vice President of Grants Management and Senior Director o…

Criteria: Recipients of Federal awards must establish and maintain effective internal controls over program income and maintain evidence that such internal controls were performed. Amounts reported as program income on the SF-425 Federal Financial Report are to be in accordance with the HIV/AIDS Bureau Policy Clarification Notice #15-03. Condition: The Corporation was unable to provide evidence of review and approval of the calculation of reported program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022. Cause: The Corporation did not have formal policies and procedures over program income reported on the SF-425 Federal Financial Report. Effect or Potential Effect: The amount of program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022, submitted to the granting agencies may be inacc…

Corrective action: Management Response #2022-008: Staff turnover in FY2020-2021, saw a departure of key personnel that calculated and filed the SF-425 Federal Financial Report for the reporting period end date of December 31, 2021. In addition, the staff that was responsible for reviewing and approving the reports left the company in FY2021. Corrective Action Plan: In FY2022, the following steps were implemented to ensure there is proper support for the program income calculation and it is reviewed and approved prior to submission of the SF-425 reports. • The Vice President of Grants Management and Senior Director of Finance will work collaboratively with their teams to ensure that the program income calculat…

Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred. Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval. Cause: The Corporation…

Corrective action: Management Response #2022-009: Due to the staff shortages and turnover in FY2020-2022 the company did not have adequate personnel in place to monitor or document grant activity. Formal documentation of policies and procedures were also deficient. Additionally, documents were not stored centrally, which made it extremely difficult to find supporting documentation. Corrective Action Plan: The following action plans have since been implemented: • During the fourth quarter in 2022, finance team delineated and expanded positions whose primary responsibility is to monitor and manage all grant activities. • During the fourth quarter in 2022 a new process was implemented to track grant related acti…

Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds. Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”. Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of th…

Corrective action: Management Response #2022-010: Due to the staff shortages and turnover in FY2020-2022 the company did not have adequate personnel in place to monitor or document grant activity. Formal documentation of policies and procedures were also deficient. Additionally, documents were not stored centrally, which made it extremely difficult to find supporting documentation. Corrective Action Plan: In mid-2023, the company established policies and procedures that formally document the current compliance practices that are in place for dissemination and training throughout the organization. Detailed in the procedures was a hard stop by the manager of procurement that would require three bids prior to a …

Criteria: Recipients of Federal awards must establish and maintain effective internal controls over special tests and provisions and maintain evidence that such internal controls were performed. Condition: During our testing of sliding fee discounts, we noted that 14 out of 40 sampled financial records reflected an incorrect discount. Cause: Front office staff collect completed income verification forms and any relevant income documentation or Patient Income Self Attestation forms from patients applying for a sliding fee discount. The Corporation did not implement controls to include review and approval by an individual other than the front office staff of the accuracy of provided discounts that were entered into the patient billing system. Effect or Potential Effect: Sliding fee discounts provided to patients may be inaccurate based on the individual’s or family’s income. Questioned…

Corrective action: Management Response #2022-011: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Corrective Action Plan: A procedure will be implemented whereby a secondary review by a Health Center Director or designee at the respective care site. The approver will sign and date the application or self-attestation form. Training of the appropriate staff will be provided with monitored. Responsible Party: Tracy Harrison, COO

Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed. Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence that Federal Funding Accountability and Transparency Act (FFATA) required under the Federal programs were submitted to the granting agency. Cause: The Corporation did not have formal policies and procedures over FFATA reporting. Effect or Potential Effect: FFATA required reports were not submitted to the granting agency. Questioned costs: None Context: Management was not able to produce sufficient and appropriate evidence that FFATA reports were submitted to the granting agency. Repeat finding: No Recommendation: We recommend the Corporatio…

Corrective action: Management Response #2022-012: Due to staff turnover in prior years and inadequate handover procedures, the Federal Funding Accountability and Transparency Act (FFATA) reports were not filed with the granting agencies as required. Corrective Action Plan: The Grants program department will develop procedures to ensure that we are compliant in the timely submission of the Federal Funding Accountability and Transparency Act (FFATA) reports. This will be monitored and audited by the Vice President of the grants program at regular intervals. In additional the grants program staff will provide monthly updates to the Finance grants team as to the status of submission as well as copying the team on…