THE Commonwealth Healthcare Corporation on Monday said it is “aligned with federal government grant compliance.”
CHCC was asked to comment about the fiscal year 2019 single audit released recently by Ernst & Young.
In an email to Variety, CHCC said it acknowledges the concerns raised in the findings of the FY 2019 single audit and would like to “provide clarity regarding our internal controls and compliance with federal grant requirements.”
CHCC said it remains committed to transparency and accountability in its financial management.
“It is important to note that the corporation has undergone multiple independent financial management reviews conducted by federal grantors, which have affirmed CHCC’s compliance with applicable federal requirements,” CHCC said.
In February 2021, the Health Resources and Services Administration or HRSA, through an independent review by Harris Group Services, concluded that CHCC’s policies and procedures align with federal grant standards.
Furthermore, in October 2024, HRSA’s Division of Financial Integrity determined that the financial management system of the CNMI’s only public healthcare provider “is capable of administering federal awards and no further action was required.”
Similarly, in May 2023, the U.S. Department of Agriculture’s Food and Nutrition Services issued a report affirming that CHCC’s financial controls met all necessary requirements with no findings of concern.
“These reviews highlight the robustness of CHCC’s internal controls and validate the organization’s capacity to effectively manage federal grants. While the 2019 Single Audit reported certain material weaknesses, CHCC does not concur with the majority of these findings. The noted weaknesses primarily related to the timeliness of providing documents during a remote audit process rather than to deficiencies in the design or implementation of internal controls. All requested documents were ultimately provided, as reflected in CHCC’s audit responses,” CHCC said.
CHCC also clarified that its agreement to the scope limitation in the 2019 audit “was procedural, intended to expedite the closure of the delayed audit, and should not be interpreted as an admission of non-compliance. It is worth emphasizing that the audit findings were shaped in part by the challenges associated with a predominantly remote review process. By contrast, the on-site reviews conducted by HRSA and FNS offered a more comprehensive evaluation of CHCC’s systems and controls.”
Now that the fiscal year 2019 audit is complete, audits for the subsequent fiscal years will follow, CHCC said. “These audits will have the same scope limitations and audit qualification as the FY 2019 audit; however, this scope is necessary as we aim to have the Single Audit current,” CHCC stated.
CHCC said it remains committed to addressing any areas of concern and continually improving its processes to maintain the highest standards of financial stewardship.
“CHCC’s dedication to serving the healthcare needs of the people of the CNMI remains unwavering, and the organization stands ready to work collaboratively with stakeholders to ensure clarity and mutual understanding of its operations. For further inquiries, CHCC encourages the public and stakeholders to reach out directly to the organization for additional information,” CHCC said.
