Criteria: The compliance manual and grant agreements establish that the Grantee shall submit annual Federal Financial Reports through the Payment Management System (PMS) within 90 days after budget period end date. For State grant, HHSC- Family planning, the grantee shall submit State Financial Report annually no later than 60 days after the end of contract period. Condition: The Organization did not timely submit the required Financial Status Reports for four of the contracts under the Health Center Cluster and the annual State Financial Report for its HHSC – Family Planning state grant: • Health Center Program: Contract No. 22H80CS04287 submitted 10 days late. • FY 2024 Behavioral Health Service Expansion - Contract No. 24H8NCS54010 submitted 7 days late. • COVID-19 - FY2023 Bridge Access Program: Contract No. 23H8LCS51559C6 submitted 29 days late. • Health Center Program Service Expansion: School Based Service Sites (SBSS) - Contract No. 23H2ECS50185 submitted 40 days late. • HHSC – Family Planning: Contract No. HHS000734600041 (State) submitted 105 days late. Cause: The Organization experienced a CFO transition during FY2025. The new CFO is still becoming familiar with compliance and reporting requirements, and internal controls were not adequately designed or operating effectively to ensure timely review, approval, and submission of reports. Effect: Failure to submit required reports in a timely manner may result in sanctions in accordance with the provisions of the grant agreements. Recommendation: Management should implement procedures to ensure timely submission of all required Federal Financial Reports and State Financial Reports, including defined timelines and ongoing monitoring. Management’s response: Management agrees with auditor’s recommendation. Refer to Corrective Action Plan for expected date of completion.