OSF HEALTHCARE SYSTEM

documentation of competitive bids for federal awards.

Finding 2019-001 Finding Type: Significant deficiency Federal program information: Federal Program: Crime Victim Assistance, CFDA No. 16.575, Award No. 2016-VA-GX-0027 Federal Agency: US Department of Justice Pass through Entity: Illinois Criminal Justice Information Authority (ICJIA) Federal Award Year: April 1, 2018 to September 30, 2019 Criteria or specific requirement Per 2 CFR 215.21 `Standards for financial management systems?, recipients? financial management systems shall provide 2 CFR 215.21(b)(1) ?accurate, current and complete disclosure of the financial results of each federally-sponsored project or program in accordance with the requirements set forth in CFR 215.52.? Furthermore, 2 CFR 215.21(b)(7) indicates that recipients? financial management systems shall provide ?accounting records including cost accounting records that are supported by source documentation.? In addition, 2 CFR 215.22 (a) states that, ?payment methods shall minimize the time elapsing between the transfer of funds from the United States Treasury and the issuance or redemption of checks, warrants, or payment by other means by recipients.? In addition, Part Two section 6.3 of the grant agreement, any payment request for reimbursement to ICJIA must be within 15 days of the end of the quarter. Title 45 US Code of Federal Regulations Part 75 (45 CFR part 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards, section 75.303 also states that non-federal entities must 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. Condition and Context During our testwork over the Crime Victim Assistance Grant, we noted that management submits reimbursement certification reports to the ICJIA to request reimbursement for expenditures incurred and paid for by the program. The expenditures reported on the quarterly reimbursement certification request forms submitted in 2019 did not agree to the actual, allowable expenditures incurred for the grant for the same period as recorded in OSF Healthcare?s accounting records. Specifically, we noted the following differences between the amounts reported and the accounting records: Reporting Period Amount Requested Quarterly Allowable Exp per GL Detail (Under)/over reimbursed 10/1/2018 ? 12/31/2018 $231 $230 $1 1/1/2019 ? 3/31/2019 193 195 (2) 4/1/2019 ? 6/30/2019 243 241 2 7/1/2019 ? 9/30/2019 207 208 (1) $874 874 - Cause and effect/potential effect Management did not perform a timely review of expenditures prior to submission of the reimbursement request. In addition, management utilized the incorrect report of grant expenditures for preparing the quarterly reimbursement forms, such that expenditures that were marked as ?Denied? by the Grant Analyst were inaccurately included for reimbursement. Questioned costs No questioned costs after consideration of offset in subsequent quarters. Whether the sampling was a statistically valid sample The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend that management design and implement internal controls that will provide for a quarterly reconciliation and management review process of the quarterly reimbursement certification forms, with established criteria for the review including documenting the reconciliation between the general ledger expenditures of the grant and the reimbursement certification, and management approval sign-off evidencing timely completion of the review. Views of responsible officials Management agrees with the finding. OSF Healthcare System is updating its internal processes to ensure timely review of all charges to federal awards includes agreeing actual, allowable expenditures to the period?s accounting records prior to submission of the reimbursement requests. Management implemented the corrective action plan on September 30, 2020.