HEALTH SERVICES CENTER INC

2019-001 Billing of ineligible services in the Ryan White Part B Program Condition: It was discovered that several clients listed on service reports for Non-Medical Case Management did not actually receive those services. Accordingly, charges with respect to those clients and servcies were ineligible to be paid with Ryan White Part B funds. This caused the grant to be overspent by $18,852.29. Criteria: Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair presentation of the financial statements, including the Schedule of Expenditures for Federal Awards, as required by Uniform Administrative Requirements, Cost Principles, and Audit Requirements. Effect: The Center did not have a training from the oversight entity to ensure proper billing practices. This caused a misunderstanding of required UWCA documentation. Recommendation: To ensure that the Schedule of Expenditures for Federal Awards is presented fairly, in all material respects, there should be proper training in the required documentation for display in the charts for the Ryan White Part B Program. Management?s Response: Ryan White Part B will only be billed for the Eligibility Specialist and the non-medical case management she performs. The Center now understands the documentation needed for the UWCA to verify services and will be displaying this in the charts.

2019-002 Overdrawing of Permanent Housing Plus Grant Condition: The previous individual responsible for approving and requesting fund drawdowns was not reconciling, recording, and allocating expenses in the financial software in a timely manner. The grant had funds that were available on the payment system. The program director had been notified that those funds were no longer available. The former CEO did not understand the payment system and did not ensure proper reconciliation was done by the CFO. This caused the money to be drawn down in error in the amount of $60,340.00. Criteria: Management is responsible for establishing and maintaining internal controls, including monitoring, and for the fair presentation of the financial statements, including the Schedule of Expenditures for Federal Awards, as required by Uniform Administrative Requirements, Cost Principles, and Audit Requirements. Effect: The Center did not have a system of internal controls that enabled management to prevent, deter, and detect misstatement in the allocation of expenses to individual grants on the Schedule of Expenditure of Federal Awards. Recommendation: To ensure that the Schedule of Expenditures for Federal Awards is presented fairly, in all material respects, the individual responsible for requesting drawdowns for grantor agencies, should reconcile the cash used for requesting drawdowns to the actual expenses allocated to the grant in the general ledger. They should also be aware of the payment system requirements. Management?s Response: Changes have been implemented which rectified this issue. Management has established more effective internal controls to include monitoring for fair representation of the financial statements.

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