Fillmore CountyLocal Government

Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) Assistance Listing Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Federal Award Identification Number and Pass-Through Numbers: 2205MN5ADM, 2205MN5MAP Compliance Requirement Affected: Reporting Award Period: Year-Ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition and Context: In a statistically valid sample of reports tested, it was noted that for one of three Medical Assistance Child and Teen Check-up monthly reports tested and 1 of 1 annual Child and Teen Check-up report tested there was no documentation of review and approval prior to submission to the state. Questioned Costs: Not applicable. Cause: Review process was implemented as a result of the 2021 audit which occurred midway through the 2022 calendar year. Effect: The lack of a review and approval process increases the risk that reports will not be submitted as required, timely or without error. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2021-005. Recommendation: We recommend the County implement internal control procedures over federal grant reporting. Reports should be reviewed by someone other than the preparer prior to submission to the pass-through agency to ensure accuracy and completeness. Documentation of the review and approval should be retained. Both the preparer and reviewer should ensure reports are submitted in a timely manner. View of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Treasury Federal Program Title: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Pass-Through Agency: N/A Federal Award Identification Number and Pass-Through Numbers: N/A Compliance Requirement Affected: Suspension and Debarment Award Period: Year-Ended December 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of procurement, suspension, and debarment. Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition and Context: The County has not developed a system of internal controls that would have ensured compliance with suspension and debarment requirements. During testing it was noted that the county did not have documentation to support vendors were not suspended or debarred. Questioned Costs: Not applicable. Cause: The County did not have a process in place to ensure the federal provisions surrounding suspension and debarment were complied with. Effect: The auditor noted no instances of noncompliance with the provisions of suspension, and debarment; however, the lack of internal controls over these compliance requirements provides an opportunity for noncompliance. Repeat Finding: No Recommendation: We recommend the County design procedures and controls to ensure compliance with suspension and debarment provisions. Before entering into a contract, a check should be performed and retained to support the contractor status. View of Responsible Officials: There is no disagreement with the audit finding.

2021-005 REPORTING Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) Assistance Listing Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Federal Award Identification Number and Pass-Through Numbers: 2105MNADM, 2105MN5MAP Compliance Requirement Affected: Reporting Award Period: Year-Ended December 31, 2021 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition and Context: In a statistically valid sample of reports tested, it was noted that for three of three Medical Assistance Child and Teen Check-up monthly reports tested and 1 of 1 annual Child and Teen Check-up report tested there was no documentation of review and approval prior to submission to the state. Questioned Costs: Not applicable. Cause: Staffing shortages due to pandemic quarantines. Effect: The lack of a review and approval process increases the risk that reports will not be submitted as required, timely or without error. Repeat Finding: No Recommendation: We recommend the County implement internal control procedures over federal grant reporting. Reports should be reviewed by someone other than the preparer prior to submission to the pass-through agency to ensure accuracy and completeness. Documentation of the review and approval should be retained. Both the preparer and reviewer should ensure reports are submitted in a timely manner. View of Responsible Officials: There is no disagreement with the audit finding

2021-006 ELIGIBILITY Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) Assistance Listing Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Federal Award Identification Number and Pass-Through Numbers: 2105MNADM, 2105MN5MAP Compliance Requirement Affected: Eligibility Award Period: Year-Ended December 31, 2021 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee 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 review of eligibility testing, it was noted there was no documented peer or supervisor review performed during 2021 and for one of sixty case files tested, there was no documentation to support that assets were verified. Questioned Costs: Not applicable. Cause: Grantor has not required a review process and as such one was not put in place. Effect: The lack of a review and approval process increases the risk that ineligible expenditures will be reimbursed. Repeat Finding: Yes; 2020-006 Recommendation: We recommend the County implement procedures and create a formal review of casefiles of recipients for which eligibility is not based on income and implement processes and procedures to ensure multiple sources of assets within an application are verified as part of the eligibility determination. View of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) CFDA Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Pass-Through Numbers: 2005MNADM, 2005MN5MAP Compliance Requirement Affected: Reporting Award Period: Year-Ended December 31, 2020 Federal Agency: U.S. Department of Treasury Federal Program Title: COVID-19 Coronavirus Relief Funds CFDA Number: 21.019 Pass-Through Agency: Minnesota Department of Management and Budget, Fillmore-Houston Community Health Board Pass-Through Numbers: SLT0016, SLT0232 Compliance Requirement Affected: Reporting Award Period: Year-Ended December 31, 2020 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. The granting agency for the COVID-19 Coronavirus Relief Funds required an expenditure report within seven business days of the end of the previous month. Condition and Context: In a statistically valid sample of reports tested, it was noted that two of five Coronavirus Relief expenditure reports for MMB tested and one of three CICT reports tested were not submitted timely. For three of three Medical Assistance Child and Teen Check-up monthly reports tested and 1 of 1 annual Child and Teen Check-up report tested, and three of three CICT reports tested, there was no documentation of review and approval prior to submission to the state. Questioned Costs: Not applicable. Cause: Staffing shortages due to pandemic quarantines. Effect: The lack of a review and approval process increases the risk that reports will not be submitted as required, timely or without error. Repeat Finding: No Recommendation: We recommend the County implement internal control procedures over federal grant reporting. Reports should be reviewed by someone other than the preparer prior to submission to the pass-through agency to ensure accuracy and completeness. Documentation of the review and approval should be retained. Both the preparer and reviewer should ensure reports are submitted in a timely manner. View of Responsible Officials: There is no disagreement with the audit finding

Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) CFDA Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Pass-Through Numbers: 2005MNADM, 2005MN5MAP Compliance Requirement Affected: Eligibility Award Period: Year-Ended December 31, 2020 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee 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 review of eligibility testing, it was noted there was no documented peer or supervisor review performed during 2020. Questioned Costs: Not applicable. Cause: Grantor has not required a review process and as such one was not put in place. Effect: The lack of a review and approval process increases the risk that ineligible expenditures will be reimbursed. Repeat Finding: Yes; 2019-008 Recommendation: We recommend the County implement procedures and create a formal review of casefiles of recipients for which eligibility is not based on income. View of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) CFDA Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Pass-Through Numbers: 1905MNADM, 1905MN5MAP Compliance Requirement Affected: Reporting Award Period: Year-Ended December 31, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition and Context: The County acts as the LCTS fiscal reporting and payment agency for the local collaborative and is responsible for preparing and submitting the annual spending and collaborative reports. The reports were not reviewed prior to submission. Questioned Costs: Not applicable. Cause: Grantor has not required a review process and as such one was not put in place. Effect: The lack of a review and approval process increases the risk that reports will not be submitted as required, timely or without error. Repeat Finding: Yes; 2018-007 Recommendation: We recommend the County implement procedures to ensure the annual spending and collaborative reports are reviewed and approved prior to submitting to DHS. Evidence of the revenue should be documented and retained. View of Responsible Officials: There is no disagreement with the audit finding

2019-008 ELIGIBILITY Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Medical Assistance Program (Medicaid Cluster) CFDA Number: 93.778 Pass-Through Agency: Minnesota Department of Human Services Pass-Through Numbers: 1905MNADM, 1905MN5MAP Compliance Requirement Affected: Eligibility Award Period: Year-Ended December 31, 2019 Type of Finding: Material Weakness over Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee 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 review of eligibility testing it was noted there was no documented peer or supervisor review performed during 2019. Questioned Costs: Not applicable. Cause: Grantor has not required a review process and as such one was not put in place. Effect: The lack of a review and approval process increases the risk that ineligible expenditures will be reimbursed. Repeat Finding: Yes; 2018-008 Recommendation: We recommend the County implement procedures and create a formal review of casefiles of recipients for which eligibility is not based on income. View of Responsible Officials: There is no disagreement with the audit finding.

2019-009 PROCUREMENT, SUSPENSION, AND DEBARMENT TRANSPORTATION Federal Agency: U.S. Department of Transportation Federal Program Title: Highway Planning and Construction Cluster CFDA Number: 20.205 Pass-Through Agency: Minnesota Department of Transportation Pass-Through Numbers: SAP 023-612-041 Compliance Requirement Affected: Procurement, Suspension and Debarment Award Period: Year-Ended December 31, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance and Compliance Criteria: Title 2 U.S. Code of Federal Regulations ? 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. In addition, Title 2 U.S. Code of Federal Regulations ? 200.318 states that the nonfederal entity must use its own documented procurement procedures which reflect applicable state, local and tribal laws and regulations, provided that the procurements conform with applicable federal law and the standards identified in this regulation. Condition and Context: The County does not have a written procurement or conflict of interest policy that include components required by Title 2 U.S. Code of Federal Regulations ? 200.318. Questioned Costs: Not applicable. Cause: The County did not adopt written procurement and conflict of interest policies. Effect: Noncompliance with Uniform Guidance. Increased risk that purchasing does not comply with federal requirements. Repeat Finding: No Recommendation: We recommend the County Board adopt written procurement and conflict of interest policies that include the components outlined in Title 2 U.S. Code of Federal Regulations ? 200.318. The written policies should be distributed and reviewed by all employees involved in federally reimbursed purchasing. View of Responsible Officials: There is no disagreement with the audit finding.

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