3793:2-1-10 Actual uniform cost report agreed upon procedures and report submission requirement.

(A) This rule establishes the requirement for all Ohio department of alcohol and drug addiction services (ODADAS)-certified programs required to submit an actual uniform cost report (AUCR) in accordance with rule 3793:2-1-09 of the Administrative Code to have the AUCR examined by an independent public accounting(IPA) firm using the agreed upon procedures (AUP) contained in appendix A to this rule prior to submission to ODADAS. The ODADAS-certified program owner shall assure any recommendations contained in the agreed upon procedures report are made and a new original AUCR is completed.

(B) Beginning with the AUCR period of July 1, 2005 through June 30, 2006 and for each subsequent state fiscal year (SFY) AUCR reporting period thereafter, the ODADAS-certified program shall submit the following to ODADAS within one hundered eighty days after the end of a SFY:

(1) The originally prepared AUCR which was completed prior to the agreed upon procedures review and in accordance with rule 3793:2-1-09 of the Administrative Code,

(2) A copy of the agreed upon procedures AUCR report completed in accordance with appendix A to othis rule and issued by the IPA firm, and

(3) If appropriate, a new original AUCR adjusted based upon the recommendations of the IPA firm as documented in the AUCR AUP report.

(C) An ODADAS-certified program reporting costs on the AUCR "Mental Health Services" line will also need to submit a copy of their information required under rule 5122-26-191 of the Administrative Code.

(D) An ODADAS-certified program which is also subject to rule 5101:2-47-26.2 of the Administrative Rule may submit the information required in rule 5101:2-47-26.2 of the Administrative Code in place of the information required by paragraph (B) of this rule with the following exception: the ODADAS-certified program is responsible for making all recommended adjustments to the AUCR and, if appropriate, completing and submitting a new original UCR.

(E) The ODADAS-certified program owner shall send the AUCR AUP reprort and, if applicable, the new original AUCR to the ODADAS' fiscal services division. A copy of the AUCR AUP report and, if applicable, a copy of the new AUCR shall be sent to the local alcohol, drug addiction and mental health service or alcohol and drug addiction services board where the program owner's primary place of business is locate.

APPENDIX Actual Uniform Cost Report Agreed Upon Procedures and Report Submission Requirement - Appendix A.

(A) An independent public accounting (IPA) firm shall use the following procedures in order to:

(1) report on the accuracy of the data reported on the actual uniform cost report (AUCR),

(2) report on the appropriateness of the allocation methods used for actual cost reporting,

(3) report on the allowability and unallowability of the cost data reported on the ACUR, and

(4) determine if the data reported on the AUCR is in accordance with the applicable federal and state resources as stated in Ohio Administrative Code 3793:2-1-09 as in effect for the State Fiscal Year (SFY) being reported.

(5) report on the consistency between the first budget uniform cost report (BUCR) and the AUCR.

(B) Work completed in other areas or during other agreed upon procedures (AUP) reviews may be used to satisfy these procedures as long as it is documented by the IPA firm how the work satisfies these procedures. Work completed during an Ohio Administrative Code 5101:2-47- 26.2 required review may be used for completing the review required by this rule. If reliance is placed on work completed by an IPA firm from another engagement, such as an Office of Management and Budget (OMB) circular A-133 audit, a financial statement audit, or other such audit or review or some other auditor's work, it must be documented in the AUP report required by this rule, how the work being relied upon meets the requirements contained in these procedures.

(C) If it is available, the previous SFY AUCR, AUCR report, and independent financial audit report are to be reviewed to determine if any management comments and/or findings will impact the current actual uniform cost report data.

(D) Obtain and inspect the program's chart of accounts, including all revenue and expense accounts.

(E) Obtain and inspect a copy of Ohio Administrative Code 3793:2-1-09 as in effect for the SFY AUCR being reviewed.

(F) obtain and inspect the first BUCR and all supporting documentation.

(G) Agreed Upon Procedures.

(1) Procedure One - Mathematical Accuracy Testing.

(a) Obtain a reconciliation of the total costs reported on the AUCR to the general ledger and/or the independently audited financial statements for the SFY being verified. Compare the amounts listed on the reconciliation to the amounts listed on the general ledger and/or independently audited financial statements for the SFY being verified. Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(b) For and by each service with costs being reported on the AUCR:

(i) sum the values reported in columns 4 and 5 and verify the result is equal to the value reported in the corresponding column 6.

(ii) sum the values reported in columns 6 and 7 and verify the result is equal to the value reported in the corresponding column 8.

(iii) verify the value reported in column 9 is equal to the result of dividing the value in column 8 by the value in column 2.

(iv) verify the valued reported in column 11 is equal to the result of subtracting the value in column 10 from the value in column 8.

(v) verify the value reported in column 12 is equal to the result of dividing the value in column 11 by the value in column 2.

(vi) verify the values reported in the "TOTALS FOR AOD SERVICES" are equal to the sum of the values reported in the corresponding column.

(vii) verify the values reported in the "TOTALS FOR AGENCY" are equal to the sum of the values reported in the corresponding column.

(2) Procedure Two - Personnel Costs Verification.

(a) Compare the personnel costs reported in column 4 of the AUCR to the salaries, wages and fringe benefits reported on the independently audited financial statements or Federal Internal Revenue Service Employer Form 941. Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(b) From the personne l costs reported in column 4 of the AUCR, select ten employees whose personnel costs roll- up to those costs. Either for one pay period or on the year end totals, perform the following procedures on the sample by inspecting the following supporting documentation:

(i) Compare the costs for allowability and unallowability as defined in Ohio Administrative Code 3793:2-1-09 paragraphs (H)(1) and (H)(2).

(ii) Compare the allocation methods used to determine whether the costs are documented as direct service (column 4a) or support service (column 4b) costs.

(iii) Compare the allocation method or methods used to determine which service personnel costs have been allocated to.

(iv) Verify any unallowable costs are allocated in the same manner they were originally allocated and are documented in the appropriate service row of column 10 of the AUCR

(v) Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(3) Procedure Three - Non-Personnel Costs Verification

(a) From the non-personnel costs reported in column 5 of the AUCR, select a haphazard sample (as defined in the American Institute of Certified Public Accountants audit sampling guide) of checks and/or electronic funds transfer (EFT) disbursements, equal to 20 percent or 40 checks and/or EFT disbursements, whichever is less. Perform the following procedures on each selected check or EFT disbursement:

(i) Compare the costs the check or EFT disbursement is for to the appropriate allowability or unallowability criteria listed in Ohio Administrative Code 3793:2-1-09 paragraphs (H)(1) and (H)(2).

(ii) Verify the allocation method or methods used for the sampled nonpersonnel costs have been made in accordance with Ohio Administrative Code 3793:2-1-09, Appendix A.

(iii) Verify any unallowable costs are allocated in the same manner they were originally allocated and are documented in the appropriate service row of column 10 of the AUCR.

(iv) Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(4) Procedure Four - Administrative Overhead Costs Verification

(a) From the administrative overhead costs reported in column 7 of the AUCR, select a haphazard sample (as defined in the American Institute of Certified Public Accountants audit sampling guide) of checks and/or electronic funds transfer (EFT) disbursements, equal to 10 percent or 20 checks and/or EFT disbursements, whichever is less. Perform the following procedures on each selected check or EFT disbursement:

(i) Compare the costs the check or EFT disbursement is for to the appropriate allowability or unallowability criteria listed in Ohio Administrative Code 3793:2-1-09 paragraphs (H)(1) and (H)(2).

(ii) Determine if the administrative overhead costs were allocated using only one of the allowable methods described in Ohio Administrative Code 3793:2-1-09, Appendix A.

(iii) Verify any unallowable costs are allocated in the same manner they were originally allocated and are documented in the appropriate service row of column 10 of the AUCR.

(iv) Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(5) Procedure Five - Units of Service Verification.

(a) From and by each service with costs reported on the AUCR, select a haphazard sample (as defined in the American Institute of Certified Public Accountants audit sampling guide) of the reported units of service, equal to 20 percent or 40 total units, whichever is less. Perform the following procedures on the selected units:

(i) Verify documentation exists in client records to support the number of units selected.

(ii) Compare the type of service selected to determine it is reported in the appropriate service line of column 2.

(iii) Identify and document any material variances (variances greater than plus or minus two percent) and obtain management's explanation of the material variance(s) for inclusion in the AUCR AUP report.

(6) Procedure Six - First BUCR to AUCR comparison.

(a) Compare the first BUCR to the AUCR and verify the methods of cost reporting selected are the same as the methods used when completing the AUCR.

(H) Actual Uniform Cost Report Agreed Upon Procedures Report

(1) A written report on the results of these AUP shall be completed by the IPA firm for the Ohio Department of Alcohol and Drug Addiction Services (ODADAS)-certified program to submit to ODADAS. The report shall be completed in accordance with the American Institute of Certified Public Accountants Statement on Standards for Attestation Engagements Statement number 11, 12 or its successors and the workpapers shall be completed in accordance with Government Auditing Standards. At a minimum, the report shall include the following:

(a) a summary of the procedures performed and the findings,

(b) a schedule listing the number of variances, if any, per procedure and a list of unallowable costs noted during the AUP,

(c) the completed copy of the AUCR, including an original signature,

(d) any other observations and/or comments of note the auditor, using their professional judgment, deems relevant.

(I) The AUCR AUP report shall be given to the ODADAS-certified program owner.

Effective: 06/29/2006
R.C. 119.032 review dates: 06/28/2011
Promulgated Under: 119.03
Statutory Authority: 3793.02(D) , 3793.06 , 3793.11
Rule Amplifies: 3793.06 , 3793.11