Corrective Action Plans

Now that disbursements are 100% in-house, the President & CEO provides final written approval on all timecards and payables. Chairman of the Loan & Finance Committee remotely reviews journal entries in accounting software monthly. Contact Person Responsible for Corrective Action: Lisa Ripper Anticipated Completion Date: 7/1/2023

Contact person(s) responsible: Associate Director, BB Beltran Recommendation: The Coalition should establish monitoring procedures to ensure that charges to federal awards and other funders are adequately documented and approved and comply with all established policies. Specifically, adequate documentation should include original itemized invoices or receipts, and clear documentation of review and approval. Management Response: NEW Corrective Action Plan: OCADSV implemented a third-party service for tracking the Coalitions costs by program in January of 2023. The submission, coding, approval and payment are processed within this software, which also allows for an audit trail of the processes performed by user and quick access to scanned original documentation. Quarterly budget expense reimbursements are prepared and submitted for review to the Associate Director and/or the Grants Manager. The monthly/quarterly reports are reviewed and approved, with general ledger support, before sending them to the funding agency as the quarterly invoice for reimbursements. Anticipated completion date: 09/30/24

Contact person(s) responsible: Accounting Manager, Nancy Wilson Recommendation: We recommend that Coalition develop controls and procedures to correctly allocate cost to all activities and funding sources that benefited from the costs. Management’s Response: Corrective action plan: OCADSV added an Administrative Cost Center to its General Ledger effective 10/01/22, the beginning of FY23 and began costing administrative payroll cost to that cost center. Additionally, the organization retrained administrative staff on direct cost allowable activities vs. administrative activities relative to timekeeping and timesheet preparation and the necessity of daily work descriptions supporting the hourly allocation. The Payroll policy that requires supervisors to review and sign off on timesheets and hourly allocations to cost centers was also reviewed. Audit costs for FY22 will be allocated in accordance with 2 CFR 200.405 requirements. Beginning with FY23 all accounting and other admin payroll related cost will be allocated to the administration cost center with the exception of time related to specific grant or other cost center. FY22 grant expenditures were reviewed post year-end and a line-by-line review was conducted to bring the direct and indirect expense cumulative total into compliance with audit findings. Any outstanding reports were adjusted to reflect the adjusted Life of grant to current date reporting. Executive, Financial and Grant Management staff will, during FY24, complete the Online Grants Financial management Training available at onlinefmt.training.ojp.gov to improve knowledge and compliance with 2 CFR 200 guidance and requirements. The said training will be incorporated into onboarding processes for any newly hired employee who have direct responsibilities related to grant management and/or reporting. Effective 6/21/23 and ongoing UPDATED Management’s Response: OCADSV is continuing its’ efforts to implement controls and procedures for directly or indirectly allocating costs to Programs based on the benefit of the cost. The updated policies and procedures manual was approved December 2024 by the board. Direct allocation is continued to be used when a specific budget program line for funding exists, or where Program(s) can be identified. For indirect cost allocation different allocation methods are used, depending on the cost type and only after the Program(s) where the costs benefited are identified. Processes implemented in FY24 and FY 25. Financial staff review grant expenditures line by line, using program budgets to actual provided by the accounting software as additional support, in preparing quarterly funding reimbursements for FY25. Anticipated completion date: 09/30/24

The organization conducts a monthly timesheet reconciliation, during which any necessary payroll adjustments are recorded. Upon noting the discrepancies identified by the auditors, the organization enhanced its payroll allocation review process in subsequent years.

Finding Number: 2022-007 Condition: Costs with prior written approval to be applied against the C8ECS43729 grant (ALN 93.526) by the federal award agency (HRSA) were coded and applied to the H8FCS40356 grant (ALN 93.224/527). Planned Corrective Action: Management will implement controls to ensure all allowable costs are properly coded and applied to the correct grant. Contact person responsible for corrective action: Chief Financial Officer Anticipated Completion Date: 06/30/2025

2022-3 Assistance Listing 93.224 Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Name of Contact Person Responsible for Corrective Action: Michelle Kellum, Executive Director Corrective Actions Planned: The Organization will take steps to maintain support of payroll charges based on actual results including timesheets indicating the amounts charged reflect actual staff time spent on the program. The Organization will also take the necessary steps to ensure that grant expenditure billing reports reflect actual program expenses supported by the general ledger and agree to actual amounts charged to the program. Anticipated Completion Date: These procedures will be implemented during the 1st quarter of 2025.

Assistance Listing Number 21.027 Lack of Internal Controls Over Major Federal Programs - Coronavirus State and Local Fiscal Recovery Funds Muskogee County has hired an internal grant administrator to assist in keeping the county compliant with all local, state, and federal requirements. Efforts will be made going forward to ensure that all grant funds are properly expended.

Assistance Listing Number 21.027 Lack of County-Wide Controls Over Major Federal Programs -Coronavirus State and Local Fiscal Recovery Funds Muskogee County has hired an internal grant administrator to assist in keeping the county compliant with all local, state, and federal requirements. Efforts will be made going forward to ensure that all grant funds are properly expended.

Reporting - Material Weakness in Internal Control over Compliance and Material Noncompliance Identification of the Federal Program: Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution - 93.498. Finding Summary: The Authority selected Option 1, as defined by HRSA, to calculate lost revenue. This option consists of reporting actual revenues from relevant quarters in the period of availability with the system calculating the lost revenues because of deadlines. The fiscal year 2021 single audit identified unallowable expenses totaling $263,861. The Company utilized excess lost revenues at the time to cover this difference. To capture the use of these lost revenues from Period 1, the Authority should have used Option 3, as defined by HRSA, to calculate and report lost revenues. Within that calculation, lost revenues could then be reduced by the $263,861. Responsible Individual: Dawn Ballard. Corrective Action Plan: Due to the timing of completion of the single audit requirements and identification of questioned costs, the report for Period 2 was unable to properly reflect the identified questioned costs. Management will implement process and procedures to ensure all required reports are completed accurately, in the event similar funding is received in the future. Anticipated Completion Date: January 16, 2025

2022-003: SFSAC Submission Contact Person – Julie Ketterling, Director Corrective Action Plan – This finding is noted together with the Board. The Unit will work to ensure timely submission of the data collection form in the future. Completion Date – The Unit will work to submit timely for the June 30, 2025 audit.

RE: Butte Native Wellness Center’s Management Response to fiscal year ending September 30, 2022 independent audit findings. Dear Board Members: The following is the Butte Native Wellness Center’s management response to the audit comments and findings regarding the independent audit conducted by WIPFLI and Company for the fiscal year ending September 30, 2022. The Summary of Auditor’s Results is attached. Within these results, the auditor’s report issued an unmodified opinion on whether the financial statements were prepared in accordance with GAAP as was the auditor's report issue on compliance for major programs. A material weakness was identified internal control over major programs, which is reviewed below. Audit Finding and Questioned Cost Related to Federal Awards: 2022-01 Internal Controls over Compliance and Compliance over Allowable Costs/Allowable Activities-Expenditures. This finding is related to Urban Indian Health Services federal grant passed through the U.S. Department of Health and Human Services, AL 93.193, with award year 2022. Criteria or Specific Requirement: Internal controls over allowable cost and allowable activities should be properly designed to provide assurance of meeting compliance requirements and should operate effectively. Supporting documentation for allocated expenditures should be maintained to demonstrate compliance with allowable costs and allowable activities. Condition: Costs were allocated between multiple projects throughout the year based on effort of employees. We were able to review some of the basis for the allocations, however, not all the documentation was available for review. Cause: Due to staff turnover, all the allocation documentation could not be located. Effect: Unallowed costs and activities could be incurred without proper documentation available for review and approval by the Company. Questioned Costs: $29,310. Context: We selected forty-five items in our sample, of those we were not provided all of the supporting documentation for sixteen items related to costs allocations. As allowed under auditing standards, we did not quantify sampling risk, resulting in our sample being not statistically valid, but acceptable under auditing standards. Repeat: No Auditor's Recommendations: While we were not able to review all allocation documentation for the year under audit, we did review subsequent allocation documentation that appeared reasonable. Therefore, management should continue to maintain the allocation documentation for subsequent years. Management Response: Butte Native Wellness Center acknowledges the finding and recognizes the need for strengthened internal controls to ensure compliance with allowable costs and allowable activities. The allocation of costs between multiple projects was based on employee effort, however, due to key staff turnover and transitions and gaps in record retention and oversight, some supporting documentation could not be located for review. Specifically, the Business and Finance Manager was employed from January 3, 2022 – April 11, 2022. The Executive Director resigned effective July 15, 2022. The last day she physically worked in the office was June 16, 2022. The Operations Manager, who was hired on May 25, 2022, assumed the oversight of office functions along with supervision of staff until a new Executive Director was hired on September 12, 2022. This Executive Director’s employment terminated on November 4, 2022. A new Executive Director was hired on December 12, 2022 and remains in the position. An outside accounting firm provided accounting and bookkeeping services until February 2022 when Butte Native Wellness Center entered into a contract with an individual to provide accounting services. That contract was not renewed when it expired in February 2023. In 2023, contracts were secured with two accounting professionals to provide key finance and accounting operations and the contracts are still in place. These contracts have allowed for proper segregation of duties, strengthened internal control structure, and enhanced accounting and financial policies, including the creation of the proper documentation and support for the agency. Corrective Action Plan: 1. Strengthening Documentation Procedures: • Management has implemented enhanced procedures to ensure all cost allocation documentation is properly maintained. • A centralized filing system, both physical and digital, has been established to ensure accessibility and retention of documentation, mitigating the risk of information loss during staff transitions 2. Training and Accountability: • All relevant personnel, including finance and program staff, will receive training on proper documentation and record-keeping practices to ensure compliance. • A designated employee will be responsible for overseeing cost allocation documentation, ensuring continuity regardless of staff changes. 3. Regular Internal Review: • Management will conduct periodic internal reviews of cost allocations to verify that all required documentation is complete and accurate. • Any missing documentation will be identified and addressed before submission for external audits. 4. Leadership Stability and Oversight: • With the Executive Director and contract accountants now acclimated to the organization and a more stable leadership structure in place, management has reinforced internal controls and oversight to prevent similar issues in the future. • Additional cross-training initiatives are being implemented to ensure institutional knowledge is retained despite staff turnover. 5. Future Compliance Commitment: • While some documentation for the year under audit was unavailable, management has reviewed subsequent allocation documentation, which was found to be reasonable. • Moving forward, all allocation documentation will be retained in accordance with compliance requirements. Management is committed to ensuring compliance with internal control standards and appreciates the auditor’s recommendations. With leadership transitions stabilizing, including a fully engaged Executive Director and improved oversight, we are confident in our ability to maintain proper documentation and strengthen financial controls. If you should have further questions or have comments, please call me at (406) 782-0461 or email trandall@buttenwc.org. Regards, Tina Randall Executive Director

Management agrees with the auditors’ findings and has implemented policies and procedures to improve recording accuracy of grant funds, including ensuring that all finance staff are properly trained. A guide will be created for current and future staff.

Finding 2022-001 Documentation of Approval - Allowable Costs – Significant Deficiency in Internal Control over Compliance Name of Contact Person: Willow Zamos, Business Manager; 907-272-1471 Planned Corrective Action: Anchorage Concert Association will improve procedures to ensure documentation of invoice approval is retained in vendor files. Anticipated Completion Date: Already implemented.

Views of Responsible Officials and Planned Corrective Actions: Management agrees with this recommendation and is in the process of improving its procedures and staff training to ensure all SAM checks are appropriately documented.

Views of Responsible Officials and Planned Corrective Actions: Management agrees that improvement is necessary with respect to reconciliation and documentation of credit card expenses. Management is in the process of updated their process surrounding credit cards.

Fraud was identified by board members of the Dover Interfaith Mission for Housing (DIMH) in November 2023 with respect to the Emergency Housing and Health programs, and an internal investigation ensued. Prior to this finding, a committee of the board reviewed the Executive Director’s (ED) financial reporting and were confident in her documentation, which was also approved by the City of Dover manager of the Emergency Housing and Health programs. Briefly, the ED had invented invoices from motels and landlords along with applications from individuals and families who did not exist. In both programs, DIMH provided funds to cover motel stays and landlord payments and was reimbursed by the City of Dover. In practice, the ED simply took DIMH funds, deposited them into a personal account, and provided invented documents to the City that resulted in reimbursement to DIMH. This clever ruse had eluded both board and city personnel monitoring the expenditures and reimbursements. Once there was suspicion of fraud, board members not involved in prior program oversight actively reviewed files with the City’s program manager to ascertain its extent. A meeting was held between the board chair and the city’s program manager to review all files in order to determine the approximate extent of the fraud, which was clearly limited to these two grant programs. In early January 2023, DIMH board members arranged to meet with the Dover Police Department to provide an overview of the fraud. This led to police contact with local FBI and HUD inspector general offices along with the US attorney for Delaware, with the same board members providing all files and in-person descriptions of the scam. These agencies continued to work on uncovering the details of the case and are expected to meet with the former ED on February 28, 2025. In early 2024, the DIMH board engaged a new external accounting firm and created a new control environment with significant internal controls and separation of duties developed in collaboration with the contracted CPA firm.

Fraud was identified by board members of the Dover Interfaith Mission for Housing (DIMH) in November 2023 with respect to the Emergency Housing and Health programs, and an internal investigation ensued. Prior to this finding, a committee of the board reviewed the Executive Director’s (ED) financial reporting and were confident in her documentation, which was also approved by the City of Dover manager of the Emergency Housing and Health programs. Briefly, the ED had invented invoices from motels and landlords along with applications from individuals and families who did not exist. In both programs, DIMH provided funds to cover motel stays and landlord payments and was reimbursed by the City of Dover. In practice, the ED simply took DIMH funds, deposited them into a personal account, and provided invented documents to the City that resulted in reimbursement to DIMH. This clever ruse had eluded both board and city personnel monitoring the expenditures and reimbursements. Once there was suspicion of fraud, board members not involved in prior program oversight actively reviewed files with the City’s program manager to ascertain its extent. A meeting was held between the board chair and the city’s program manager to review all files in order to determine the approximate extent of the fraud, which was clearly limited to these two grant programs. In early January 2023, DIMH board members arranged to meet with the Dover Police Department to provide an overview of the fraud. This led to police contact with local FBI and HUD inspector general offices along with the US attorney for Delaware, with the same board members providing all files and in-person descriptions of the scam. These agencies continued to work on uncovering the details of the case and are expected to meet with the former ED on February 28, 2025. In early 2024, the DIMH board engaged a new external accounting firm and created a new control environment with significant internal controls and separation of duties developed in collaboration with the contracted CPA firm.

COMMUNITY ACTION CENTER AGREES WITH THE FINDINGS REPORTED AND HAS MADE CORRECTIVE ACTION TO RECTIFY THE FINDING.

Management Response and Corrective Action: The Agency agrees with the finding and acknowledges the need to improve controls and documentation processes related to federal grant reporting. The Agency will implement the following corrective actions: - By April 30, 2025, establish formal review and approval procedures for all federal grant reports submitted to HRSA. - Provide training to all relevant staff on the new procedures and federal compliance requirements by April 30, 2025. - Ensure that all future reports submitted to HRSA include traceable documentation of the review and approval process. Management will monitor the implementation of these procedures to ensure their effectiveness in addressing the deficiency.

Responsible Person: Chief Financial Officer Anticipated Completion Date : December 31, 2025 / On-going Corrective Action:The management of Clayton County Community Services Authority, Inc. has reviewed the above referenced finding and fully agrees with the recommendation that all financial reporting and submission requirements and deadlines required by federal and state regulation be adhered to for future periods.The organization engaged a new au dit firm to complete the fiscal year 2022, 2023 and 2024 audit periods. With the completion of the fiscal year 2022 audit, the organization and audit firm immediately began the preparation for fiscal year 2023 . The subsequent year's audits have been prioritized and will be completed and submitted as soon as possible in order to bring the organization current and in compliance with this finding. The timeline for completion is estimated to be December 31, 2025.

Responsible Persons: Director of Human Resources, Director of Community Support, Chief Financial Officer, Senior Managers, Department Managers Anticipated Completion Date: February 1, 2025 / On-going Corrective Action: The management of Clayton County Community Services Authority, Inc. has reviewed the above referenced finding and fully agrees with the recommendation to enforce the documented policies and procedures as it relates to ensuring payroll cost are properly approved. Management has immediately initiated the process where all timesheets and time and attendance records are reviewed for each pay period and properly approved before being submitted to the payroll department for processing and payment. Each department is responsible for this review and no employee will be paid without proper approval. Signed timesheets are also forwarded to the Human Resources Director and filed for further review. The Human Resources Director has initiated the process of the annual performance appraisal for each employee at the organization starting no later than February 1st of each calendar year. The performance appraisals should be completed by the end of the month in which they begin and will be properly reviewed and signed before filing in the employee's personnel file.

Corrective Action: Management agrees with the findings. While we have policies and procedures as recommended by the auditors, there is an opportunity to review our policies and procedures related to the review and approval around disbursements. Through the leadership of our Chief Financial Officer and our Director of Finance, our internal control policies and procedures will be evaluated and as needed, amended, with an effective date no later than June 30, 2025. Anticipated Completion Date: June 30, 2025 Contact Person: Marco Giordano, Vice President and Chief Financial Officer

Finding 2022-004 Name of Responsible Individual: Carolina Liriano, Grant Manager; Holly Forester, Controller; Sheri Brady, VP and Chief Program Officer Corrective Action: CDF will enhance its internal processes and staffing to ensure the timely submission of future Single Audit Reporting Packages. In January 2025, CDF hired an Outsourced Grant Manager dedicated to overseeing federal grant management, including the coordination and timely submission of all required audit and reporting packages. Key actions include:  Establishing and maintaining a robust timeline for audit activities, closely collaborating with both the accounting team and external auditors to guarantee adherence to submission deadlines.  Implementing a cross-training program within the accounting and compliance departments to mitigate the risk of disruption due to staff turnover, ensuring multiple staff members are proficient in handling audit-related tasks.  Scheduling regular internal audits and compliance checks to proactively identify and address potential issues well in advance of filing deadlines. Anticipated Completion Date: December 31, 2025.

Finding 2022-002 Name of Responsible Individual: Carolina Liriano, Grant Manager; Holly Forester, Controller; Sheri Brady, VP and Chief Program Officer   Corrective Action: CDF hired an Outsourced Grant Manager starting January 2025 who will assume comprehensive oversight of all facets of grant administration and compliance. The grant manager's duties will include ensuring that all reimbursement requests are substantiated by adequate documentation, such as actual invoices, payroll registers, and payment records. Key actions include:  Establishing a systematic process for the collection, organization, and retention of all requisite documents.  Implementing internal review and approval procedures to guarantee that every reimbursement request undergoes thorough vetting and receives approval prior to submission, with explicit documentation of the review process.  Instructing both existing and new personnel on these newly instituted procedures to prevent future inconsistencies. Anticipated Completion Date: December 31, 2025.

Finding 2022-001 Name of Responsible Individual: Carolina Liriano, Grant Manager; Holly Forester, Controller; Sheri Brady, VP and Chief Program Officer Corrective Action: CDF hired an Outsourced Grant Manager starting January 2025 to oversee compliance and internal control processes for federal awards, ensuring adherence to 2 CFR Part 200. The Outsourced Grant Manager will implement systems to accurately allocate salaries, wages, and other expenditures. Key actions include:  Payroll Expenditures: Establish procedures to approve payroll allocations based on actual time and effort reporting, requiring supervisor approval and periodic reviews for compliance.  Non-Payroll Expenditures: Develop approval processes for non-payroll expenses, ensuring detailed documentation and implementing checks to verify overhead allocations.  Documentation and Review: Implement a comprehensive filing system for approvals and supporting documents, with regular training for staff.  Ongoing Compliance Monitoring: Conduct periodic internal audits to ensure adherence to internal controls and federal regulations, addressing issues promptly. These measures will strengthen CDF’s internal controls, ensure compliance, and maintain the integrity of federal award management. Anticipated Completion Date: December 31, 2025.