West River Area Health Education CenterNon-Profit

#2024-003 FINDING: Compliance Controls Federal Program Affected: H-1B Rural Healthcare Grant, Assistance Listing #17.286. Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Cash Management, Eligibility, Earmarking. Questioned Costs: None. Condition and Cause: During compliance testing, we noted there was an overall lack of segregation of duties and weaknesses in internal controls related to compliance. Criteria and Effect: Adequate internal controls are necessary to ensure compliance with federal grant programs. We noted: 1. There is no formal approval of electronic funds transfers related to the DOL program. The Executive Director receives invoices and remits payment electronically with no subsequent formal review. 2. We noted 17 federal expenditures out of 60 selected for testing did not have executive director coding or approval to indicate the expenditure was allowable. 3. Federal grant expenditures were not charged consistently to general ledger accounts. The lack of consistency makes tracking expenditures difficult for federal grant budget categories and for financial statement natural classification. Adjustments were made to reclassify inconsistencies identified during the audit. 4. Stipends for participants are required to be less than 10 percent of the grant budget. However, there is a lack of consistency when tracking tuition stipends. 5. We noted a lack of control processes surrounding cutoff of federal expenditures at year end. An adjustment was recorded to correct cutoff of grant expenditures. 6. Proper supporting documentation for eligibility requirements was not maintained during the year. Eligibility support was obtained during the audit process from participants. Repeat Finding from Prior Year: Yes, prior year finding 2023-003. Recommendation: We recommend the Organization continue to develop additional oversight and segregation of duties related to internal controls over compliance. Response/Corrective Action Plan: See Organization’s Corrective Action Plan

#2023-001 FINDING: Financial Statement and Schedule of Expenditures of Federal Awards (SEFA) Preparation Federal Program Affected: DOL H-1B, Assistance Listing #17.286. Compliance Requirement: Reporting. Questioned Costs: None. Condition and Cause: We were requested to draft the audited financial statements, related footnote disclosures, and SEFA as part of our regular audit services. Ultimately, it is management’s responsibility to provide for the preparation of the Organization’s statements, footnotes, and SEFA, and the responsibility of the auditor to determine the fairness of presentation of those statements. From a practical standpoint, we do both for you at the same time in connection with our audit. This is not unusual for us to do this with organizations of your size. Criteria and Effect: This control deficiency could result in a material misstatement to the financial statements or SEFA that would not be prevented or detected by your Organization’s internal control system. Repeat Finding from Prior Year: No. Recommendation: We have instructed management to review a draft of the auditor prepared financial statements in detail for their accuracy. It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Response/Corrective Action Plan: See Organization’s Corrective Action Plan

#2023-003 FINDING: Compliance Controls Federal Program Affected: DOL H-1B, Assistance Listing #17.286. Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Cash Management, Eligibility, Earmarking, Reporting. Questioned Costs: None. Condition and Cause: During compliance testing, we noted there was an overall lack of segregation of duties and weaknesses in internal controls related to compliance. Criteria and Effect: The following internal control deficiencies resulted in misstatements to the financial statements and several classification errors were not prevented or detected by your Organization’s internal control system. 1. There is no formal approval of bank charges related to the DOL program. The Executive Director receives invoices and remits payment with no subsequent formal review. 2. We noted 23 federal expenditures out of 60 selected for testing did not have executive director coding or approval to indicate the expenditure was allowable. 3. The Executive Director prepares and submits the Payment Management System grant reimbursement requests with no additional review prior to submission. 4. The Executive Director prepares, uploads, and certifies the grant financial reports. One of six grant reports tested was filed one day late. 5. Federal grant expenditures were not charged consistently to general ledger accounts. The lack of consistency makes tracking expenditures difficult for federal grant budget categories and for financial statement natural classification. Adjustments were made to reclassify inconsistencies identified during the audit. 6. We noted expenditures for fiscal year 2022 were recorded in fiscal year 2023. We also noted fiscal year 2023 expenditures were not properly accrued at year-end. Adjustments were recorded to correct year-end cutoff of grant expenditures and grant revenue. 7. Proper supporting documentation for eligibility requirements was not maintained during the year. Repeat Finding from Prior Year: No. Recommendation: We recommend the Organization continue to develop additional oversight and segregation of duties related to internal controls over compliance. The Organization had a review with the Department of Labor for the DOL H-1B grant during 2023 resulting in findings for segregation of duties and eligibility, which were improved or corrected subsequent to the fiscal year-end. Response/Corrective Action Plan: See Organization’s Corrective Action Plan