Corrective Action Plans

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Noncompliant Fixed-Amount Subawards - Immunization - DPHHS - The Montana Department of Public Health and Human Services does not concur. All subawards, including those referenced in the finding, were explicitly listed in the federally approved budget documents and the Notice of Award (NOA). These ma...
Noncompliant Fixed-Amount Subawards - Immunization - DPHHS - The Montana Department of Public Health and Human Services does not concur. All subawards, including those referenced in the finding, were explicitly listed in the federally approved budget documents and the Notice of Award (NOA). These materials contained the subaward amounts that the auditors questioned and were formally reviewed and approved by the Centers for Disease Control and Prevention (CDC). The approval included the fixed-amount subaward methodology and the department’s planned use of funds. In addition, the CDC conducted a technical review during the same period and identified no findings or compliance issues, including none related to fixed-amount subawards or internal controls. In September 2025, the department consulted program officials at the CDC, who reaffirmed that the approved NOAs and budgets are sufficient evidence of federal approval and compliance. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - N/A
Inadequate User Access Reviews - HPC - MDT - The Montana Department of Transportation has implemented a security review for AASTHOWare to ensure compliance in 2026. Responsible Party - Kimberly Doherty, Accounting Systems Supervisor, Montana Department of Transportation Dustin Rouse, Chief Engineer,...
Inadequate User Access Reviews - HPC - MDT - The Montana Department of Transportation has implemented a security review for AASTHOWare to ensure compliance in 2026. Responsible Party - Kimberly Doherty, Accounting Systems Supervisor, Montana Department of Transportation Dustin Rouse, Chief Engineer, Montana Department of Transportation Target Implementation Date - 12/31/2026
Inadequate Controls Over Indirect Cost Rate Proposals - HPC - MDT - The Montana Department of Transportation has updated its procedures and checklist to ensure required submittals are received on time. These updates were in effect for the 2026 rate. Responsible Party - Kimberly Doherty, Accounting S...
Inadequate Controls Over Indirect Cost Rate Proposals - HPC - MDT - The Montana Department of Transportation has updated its procedures and checklist to ensure required submittals are received on time. These updates were in effect for the 2026 rate. Responsible Party - Kimberly Doherty, Accounting Systems Supervisor, Montana Department of Transportation Dustin Rouse, Chief Engineer, Montana Department of Transportation Target Implementation Date - 12/31/2026
Inadequate Supporting Documentation - Foster Care - DPHHS - The Montana Department of Public Health and Human Services reviewed the fiscal year 2024 payment error and will address the affected reimbursement. The department will continue applying its improved internal control procedures to ensure com...
Inadequate Supporting Documentation - Foster Care - DPHHS - The Montana Department of Public Health and Human Services reviewed the fiscal year 2024 payment error and will address the affected reimbursement. The department will continue applying its improved internal control procedures to ensure compliance. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - 7/1/2024
Inadequate Supporting Documentation - Transit - MDT - The Montana Department of Transportation’s Transit Section will continue working closely with subrecipients to ensure proper documentation is consistently provided and retained. The fully staffed Transit Section is reviewing reimbursement submiss...
Inadequate Supporting Documentation - Transit - MDT - The Montana Department of Transportation’s Transit Section will continue working closely with subrecipients to ensure proper documentation is consistently provided and retained. The fully staffed Transit Section is reviewing reimbursement submissions more thoroughly, reinforcing documentation expectations and strengthening the department’s internal controls. Cost principle training is now part of the onboarding process for Transit Section staff, and additional training will be provided as new regulations or guidance become available. Responsible Party - Kimberly Doherty, Accounting Systems Supervisor, Montana Department of Transportation Target Implementation Date - 12/31/2026
Inadequate Supporting Documentation - ELC - DPHHS - The Montana Department of Public Health and Human Services established a procedure and a shared location for project documentation in 2023. The department will verify compliance through periodic reviews to ensure it is used. In addition, management...
Inadequate Supporting Documentation - ELC - DPHHS - The Montana Department of Public Health and Human Services established a procedure and a shared location for project documentation in 2023. The department will verify compliance through periodic reviews to ensure it is used. In addition, management will periodically remind staff of the procedures for storing all files in the designated shared location. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - 8/21/2026
Noncompliant Equipment and Construction Controls – ESSER – OPI - The Montana Office of Public Instruction notes that the grant is closed and the temporary grant-funded staff are no longer with the agency. Moving forward, new grant managers will have better direction on the agency’s internal controls...
Noncompliant Equipment and Construction Controls – ESSER – OPI - The Montana Office of Public Instruction notes that the grant is closed and the temporary grant-funded staff are no longer with the agency. Moving forward, new grant managers will have better direction on the agency’s internal controls. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 9/30/2026
Noncompliant Duplicate Expenditure Recording - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. The Office has created a procurement unit to ensure contract terms meet program needs. The Office has also implemented approval workflows for contract funding to ensure bu...
Noncompliant Duplicate Expenditure Recording - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. The Office has created a procurement unit to ensure contract terms meet program needs. The Office has also implemented approval workflows for contract funding to ensure budgets are aligned before contracts are executed. Internal controls between procurement, programs, and accounting will continue to be strengthened to prevent future overpayments. The grant is closed, and the temporary grant-funded staff are no longer with the agency. Moving forward, new grant managers will receive clearer direction on the agency’s internal controls. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Noncompliant Contractor Overpayments and Unallowable Charges - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. The Office and the University of Montana - Western established a teacher residency program originally funded with Elementary and Secondary School Emergency...
Noncompliant Contractor Overpayments and Unallowable Charges - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. The Office and the University of Montana - Western established a teacher residency program originally funded with Elementary and Secondary School Emergency Relief funds. The agreement set a fixed amount per student, but the University billed the Office for fringe benefits for each participant, which caused total costs to exceed the contract amount. The current agreement and program structure have been updated to prevent this issue. The Office has created a procurement unit to ensure contract terms support program needs. The Office has also implemented approval workflows for contract funding to confirm that budgets are aligned before agreements are executed. Internal controls between procurement, programs, and accounting will continue to be strengthened to prevent future overpayments. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Noncompliant Direct and Indirect Cost Charges - ESSER - OPI - The Montana Office of Public Instruction partially concurs with this finding. Spreadsheets supporting items 0005169673 and 0005227738 were provided to the Legislative Audit Division on August 11, 2026. The Central Services Division spent ...
Noncompliant Direct and Indirect Cost Charges - ESSER - OPI - The Montana Office of Public Instruction partially concurs with this finding. Spreadsheets supporting items 0005169673 and 0005227738 were provided to the Legislative Audit Division on August 11, 2026. The Central Services Division spent direct time on the Elementary and Secondary School Emergency Relief (ESSER) reporting, and those hours were charged directly to that program. Administrative and management staff also spent time preparing reports for quarterly briefings, presentations to community partners, responses to school and community inquiries, and newsletter submissions. The Office charged those hours to the ESSER program as they were directly related to the required reporting. However, the Office concurs with the questioned indirect cost charges in addition to personal services. The Office has implemented a tracking mechanism to ensure appropriate time reporting. For fiscal year 2027, the Office has added a monthly review of each federal budget to confirm that time reported aligns with the expected and allocated time for each project. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Noncompliant Annual Reporting Controls - ESSER - OPI - The Montana Office of Public Instruction concurs with the finding. The grant is closed, and the temporary grant-funded staff are no longer with the agency. Moving forward, new grant managers will receive clearer direction on the agency’s interna...
Noncompliant Annual Reporting Controls - ESSER - OPI - The Montana Office of Public Instruction concurs with the finding. The grant is closed, and the temporary grant-funded staff are no longer with the agency. Moving forward, new grant managers will receive clearer direction on the agency’s internal controls. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Inadequate Support for Federal Reimbursement - ESSER - OPI - The Montana Office of Public Instruction has already implemented more stringent criteria for cash requests from schools. Although this has created additional burden for local education agencies, the Office has remained firm on the informat...
Inadequate Support for Federal Reimbursement - ESSER - OPI - The Montana Office of Public Instruction has already implemented more stringent criteria for cash requests from schools. Although this has created additional burden for local education agencies, the Office has remained firm on the information required. These criteria were implemented in late 2024 and have been required since that time. Cash requests are audited quarterly by the Internal Control Auditor against the budget documents submitted, and any issues identified are addressed. No further action is needed other than continuing the current process. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Noncompliant FFATA Reports - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. This grant is closed. For all future reporting under the Federal Funding Accountability and Transparency Act, the Office will update internal guidance to align with federal regulations and ...
Noncompliant FFATA Reports - ESSER - OPI - The Montana Office of Public Instruction concurs with this finding. This grant is closed. For all future reporting under the Federal Funding Accountability and Transparency Act, the Office will update internal guidance to align with federal regulations and federal oversight requirements. The Office will ensure that required documentation is maintained and that reconciliations verify values in USAspending and SAM. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Inadequate Supporting Documentation - Disaster Grants - DMA - The Montana Department of Military Affairs, Disaster and Emergency Services Division partially concurs. The Division validated the reviewed project costs through its internal review and through additional Federal Emergency Management Agen...
Inadequate Supporting Documentation - Disaster Grants - DMA - The Montana Department of Military Affairs, Disaster and Emergency Services Division partially concurs. The Division validated the reviewed project costs through its internal review and through additional Federal Emergency Management Agency (FEMA) processes, including the Validate As You Go procedure, and determined the costs to be allowable. The division acknowledges the cited federal compliance criteria and recognizes the opportunity to strengthen the consistency, accessibility, and retention of project documentation. To enhance existing processes, the division has implemented a standardized project file structure that clearly identifies the location of supporting documentation and ensures official grant files are complete rather than relying solely on documentation stored within federal systems. This process is being applied to the disasters that occurred in December 2025 and were federally declared in April 2026. The division will continue to evaluate and refine its documentation practices while maintaining appropriate controls, reviews, validations, payments, and closeout procedures for federally funded projects. Responsible Party - Janae Brower, Chief Financial Officer, Montana Department of Military Affairs Target Implementation Date - 10/31/2026
Inadequate Provider Eligibility Controls - CHIP - DPHHS - The Montana Department of Public Health and Human Services does not concur. The department’s existing screening and enrollment controls satisfy the requirements of 42 CFR 455.410 and 455.412, and the federal grantor agency has already reviewe...
Inadequate Provider Eligibility Controls - CHIP - DPHHS - The Montana Department of Public Health and Human Services does not concur. The department’s existing screening and enrollment controls satisfy the requirements of 42 CFR 455.410 and 455.412, and the federal grantor agency has already reviewed and formally closed this finding based on those controls, as described below. The department implemented enhanced internal controls in fiscal year 2025 in direct response to prior single audit recommendations. Under these controls, the department receives and reviews a comprehensive quarterly screening report from its contractor and requires documented follow‑up when necessary. The federal grantor agency reviewed the department’s enhanced procedures, the contractor’s screening methodology, and the validation results, and closed the single audit finding, confirming the controls were adequate. In January 2025, the contractor provided a validation in which active National Provider Identifiers (NPIs) were compared against the Montana Medicaid file and the Provider Enrollment, Chain and Ownership System (PECOS). The validation confirmed a 96‑percent match rate requiring no further screening or enrollment actions, leaving only 4 percent of providers for the contractor to screen and enroll under federal requirements. Upon later audit inquiry, the department again consulted the federal agency. While reiterating regulatory expectations, the federal agency clarified that “the form and manner” of oversight activities remain within the state agency’s discretion. Given this explicit federal affirmation, together with the agency’s prior closure of the finding, the department maintains that its controls are fully compliant and effective and respectfully disagrees with the audit finding. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - N/A
Erroneous Beneficiary Payments - CHIP - DPHHS - The Montana Department of Public Health and Human Services does not concur. The department identified an interface issue with its contractor and promptly corrected the affected payments. The unadjusted claim amount totaled approximately $26,000 and aff...
Erroneous Beneficiary Payments - CHIP - DPHHS - The Montana Department of Public Health and Human Services does not concur. The department identified an interface issue with its contractor and promptly corrected the affected payments. The unadjusted claim amount totaled approximately $26,000 and affected 48 beneficiaries out of $146.6 million in total contractor‑paid claims during the audit period, representing approximately 0.018 percent of total claims paid. The department determined this amount to be immaterial to the fiscal year‑end financial statements. Had the amount been significant, the department would have corrected the affected payments before fiscal year‑end. The department worked with its contractor to resolve the interface issue, which was fully corrected in April 2026. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - N/A
Inaccurate Subsidy Payments - Adoption Assistance - DPHHS - The Montana Department of Public Health and Human Services agrees that its prior method for tracking subsidy rate changes was manual and was not sufficient to ensure all scheduled rate changes were applied. The practice of including multipl...
Inaccurate Subsidy Payments - Adoption Assistance - DPHHS - The Montana Department of Public Health and Human Services agrees that its prior method for tracking subsidy rate changes was manual and was not sufficient to ensure all scheduled rate changes were applied. The practice of including multiple rates in adoption subsidy agreements was discontinued in 2023. When the error was identified, the department conducted a full review of the affected activity to determine the scope of the issue, identified additional errors, and reported those errors to the auditors. The department corrected all payment errors, repaid the affected federal funds, and implemented tracking controls over the remaining scheduled subsidy rate changes. The department completed this corrective action in March 2026. Responsible Party - Brenda Crawford, Internal Control and Compliance Officer, Montana Department of Public Health and Human Services Target Implementation Date - 3/20/2026
Inadequate Supporting Documentation - SPED - OPI - The Montana Office of Public Instruction partially concurs with this finding. The prior audit was not completed in time for the Office to implement changes before the fiscal years reviewed in the current audit. The Office implemented more stringent ...
Inadequate Supporting Documentation - SPED - OPI - The Montana Office of Public Instruction partially concurs with this finding. The prior audit was not completed in time for the Office to implement changes before the fiscal years reviewed in the current audit. The Office implemented more stringent criteria for cash requests from schools in late 2024, and those requirements have been in place since that time. Although there has been considerable pushback from local education agencies due to the added burden, the Office has remained firm on the information required. Cash requests are audited quarterly by the Internal Control Auditor against submitted budget documents, and any issues identified are addressed. These criteria are fully implemented, and no further corrective action is necessary beyond continuing the current process. Responsible Party - April Grady, Chief Financial Officer, Montana Office of Public Instruction Target Implementation Date - 12/31/2026
Inadequate HDS System Access Controls - HVC - Commerce - The Montana Department of Commerce has developed a user access review procedure to be performed semiannually. The first review was completed in June 2026. Responsible Party - Ingrid Mallo, Chief Financial Officer, Montana Department of Commerc...
Inadequate HDS System Access Controls - HVC - Commerce - The Montana Department of Commerce has developed a user access review procedure to be performed semiannually. The first review was completed in June 2026. Responsible Party - Ingrid Mallo, Chief Financial Officer, Montana Department of Commerce Target Implementation Date - 12/16/2026
Noncompliant Procurement Delegation - R&D - DOA, MUS - The Montana Department of Administration State Procurement Services Division is centralizing procurement staff and processes across all agencies to improve consistency in laws, rules, procedures, and policies when agencies procure products and s...
Noncompliant Procurement Delegation - R&D - DOA, MUS - The Montana Department of Administration State Procurement Services Division is centralizing procurement staff and processes across all agencies to improve consistency in laws, rules, procedures, and policies when agencies procure products and services. To modernize and integrate procurement in the Statewide Accounting, Budgeting, and Human Resources System and to strengthen oversight and payment of contractual obligations, the department is soliciting a new procurement system. All agencies will be required to document contract management activities in the new system. Compliance reviews will be conducted by a Department of Administration internal auditor beginning in fiscal year 2027 and will be prioritized according to risk assessment scores, auditor workload, and agency capacity. The department has improved compliance for sole‑source grants by appointing new committee members, and annual training for policies and procedures will be revised as needed. The State Procurement Services Division will develop and distribute a standard form for declaring exigencies to ensure agencies document all information required by statute, rule, and policy. The division is also preparing changes to administrative rules to clarify definitions and help agencies distinguish between exigent purchases and other expedited purchasing methods. The University of Montana - Missoula will continue working with the Montana Office of the Commissioner of Higher Education, which serves as the university’s liaison with the Department of Administration, to ensure written delegation agreements are executed and maintained in a timely manner. Montana State University - Bozeman concurs with the finding and agrees there are no questioned costs associated with the condition. The university will continue to work with the Montana University System office to receive an executed delegation of authority. A draft delegation was received from the Department of Administration in May 2026, and the university system provided feedback. As of the date of the audit report, the university has not received an update from the department. Responsible Party - Molly McLoughlin, Administrator, Montana Department of Administration Bob Hlynosky, Director of Procurement, University of Montana - Missoula Brian O'Connor, Chief Procurement Officer, Montana Office of the Commissioner of Higher Education Target Implementation Date - 6/30/2027
Inadequate Payroll Certification Controls - R&D - UM - The University of Montana - Missoula will work with Information Technology to confirm that Personnel Activity Report reminder emails are sent on the correct schedule and to the appropriate individuals, including the Office of Sponsored Programs....
Inadequate Payroll Certification Controls - R&D - UM - The University of Montana - Missoula will work with Information Technology to confirm that Personnel Activity Report reminder emails are sent on the correct schedule and to the appropriate individuals, including the Office of Sponsored Programs. The University will provide Personnel Activity Report certification training to the campus and will conduct targeted outreach for departments with outstanding records. After the current cleanup effort is completed, Grants and Contracts Officers will review outstanding Personnel Activity Reports quarterly and follow up as needed to promote timely certification. Responsible Party - Nicole Thompson, Director, Office of Sponsored Programs, University of Montana - Missoula Target Implementation Date - 2/28/2027
Inadequate Grant Expenditure Reconciliations - R&D - UM - The University of Montana - Missoula has implemented the remediation plan from the prior audit by establishing an additional periodic supervisory review to monitor ledger completion. Managers currently review a random sample of five files eac...
Inadequate Grant Expenditure Reconciliations - R&D - UM - The University of Montana - Missoula has implemented the remediation plan from the prior audit by establishing an additional periodic supervisory review to monitor ledger completion. Managers currently review a random sample of five files each month from each grants and contracts officer’s workload to verify that ledgers are current and complete, and any deficiencies identified are promptly addressed to ensure compliance with established procedures. Responsible Party - Nicole Thompson, Director, Office of Sponsored Programs, University of Montana - Missoula Target Implementation Date - 3/1/2026
Inadequate HAP Reconciliation Controls - HVC - Commerce - The Montana Department of Commerce has provided additional staff training to ensure housing assistance payments are issued timely, even though the error rate was less than one percent. Responsible Party - Ingrid Mallo, Chief Financial Officer...
Inadequate HAP Reconciliation Controls - HVC - Commerce - The Montana Department of Commerce has provided additional staff training to ensure housing assistance payments are issued timely, even though the error rate was less than one percent. Responsible Party - Ingrid Mallo, Chief Financial Officer, Montana Department of Commerce Target Implementation Date - 8/19/2026
Inadequate HAPPY System Access Controls - HVC - Commerce - The Montana Department of Commerce began conducting user access reviews during the audit period. The department’s Chief Information Officer updated the Access Control Policy and distributed it to all employees. Staff received training on acc...
Inadequate HAPPY System Access Controls - HVC - Commerce - The Montana Department of Commerce began conducting user access reviews during the audit period. The department’s Chief Information Officer updated the Access Control Policy and distributed it to all employees. Staff received training on access control requirements on May 28, 2026. The department plans to obtain a new vendor to replace the HAPPY system by October 2028. Responsible Party - Ingrid Mallo, Chief Financial Officer, Montana Department of Commerce Target Implementation Date - 10/31/2028
Inadequate Field Agent Payment Controls - HVC - Commerce - The Montana Department of Commerce has updated its processes to ensure that contract limits are reviewed prior to payments being issued and that contract amendments are pursued when needed. Responsible Party - Ingrid Mallo, Chief Financial O...
Inadequate Field Agent Payment Controls - HVC - Commerce - The Montana Department of Commerce has updated its processes to ensure that contract limits are reviewed prior to payments being issued and that contract amendments are pursued when needed. Responsible Party - Ingrid Mallo, Chief Financial Officer, Montana Department of Commerce Target Implementation Date - 8/24/2026
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