Corrective Action Plans

Finding 1205287 (2025-003)

Material Weakness 2025

ND

Allowable Costs / Cost Principles Procurement, Suspension & Debarment HUD Housing Programs

Contact Person: Duane Poitra, Business Manager Corrective Action Plan: We will resolve these issues and ensure full compliance by training purchasing agents and business office staff to properly document federally funded purchase order expenditures, maintain supporting invoices, and verify that vend...

Contact Person: Duane Poitra, Business Manager Corrective Action Plan: We will resolve these issues and ensure full compliance by training purchasing agents and business office staff to properly document federally funded purchase order expenditures, maintain supporting invoices, and verify that vendor quotes reflect competitive market rates. Purchasing agents and approving administrators will also ensure staff travel requests are electronically filed; all related documentation for all related expenses will be collected. Additional training will be provided to relevant staff on federal expenditure guidelines to prevent future issues. These corrective actions will mitigate the risk of non-compliance and ensure that expenditures are reasonable and necessary for the federal award. Anticipated Completion Date: Fiscal Year 2025-2026

View Audit 396993

Finding 1205269 (2025-005)

Material Weakness 2025

Roof Above, Inc.

NC

Allowable Costs / Cost Principles

Corrective Action Plan Allowable Costs and Activities – Finding 2025-005 Roof Above will ensure payroll expenses will be allocated based on the allocation policy and job responsibilities of those working on the program. Allocations will be reviewed quarterly and reflected in the payroll system. Cont...

Corrective Action Plan Allowable Costs and Activities – Finding 2025-005 Roof Above will ensure payroll expenses will be allocated based on the allocation policy and job responsibilities of those working on the program. Allocations will be reviewed quarterly and reflected in the payroll system. Contact person responsible for corrective action: Tonya Frye, Chief Financial Officer Anticipated completion date: June 30, 2026

View Audit 396990

Finding 1205266 (2025-004)

Material Weakness 2025

Roof Above, Inc.

NC

Allowable Costs / Cost Principles

Corrective Action Plan Allowable Costs and Activities – Finding 2025-004 Roof Above will ensure administrative payroll expenses will be allocated based on the allocation policy and job responsibilities of those working on the program. Allocations will be reviewed quarterly and reflected in the payro...

Corrective Action Plan Allowable Costs and Activities – Finding 2025-004 Roof Above will ensure administrative payroll expenses will be allocated based on the allocation policy and job responsibilities of those working on the program. Allocations will be reviewed quarterly and reflected in the payroll system. Contact person responsible for corrective action: Tonya Frye, Chief Financial Officer Anticipated completion date: June 30, 2026

View Audit 396990

Finding 1205216 (2025-002)

Material Weakness 2025

Passage Home

NC

Allowable Costs / Cost Principles Cash Management Significant Deficiency

Significant Deficiency in Internal Control over Compliance and Other Matters Recommendation: Significant Deficiency in Internal Control over Compliance and Other Matters Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to findi...

Significant Deficiency in Internal Control over Compliance and Other Matters Recommendation: Significant Deficiency in Internal Control over Compliance and Other Matters Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management believes the issue resulted from timing overlap with the prior year audit, as the transactions occurred in July and August 2024, shortly after the fiscal year-end June 30, 2024. To address this matter, management has retrained existing staff and is in the process of training the new CFO. In addition, management has performed a re-review of accounting records to confirm that no other instances of sales tax misclassification have occurred. Name of the contact person responsible for corrective action: Karen Harshman Planned completion date for corrective action plan: June 30, 2026

View Audit 396885

Finding 1205204 (2025-002)

Material Weakness 2025

Southeast Nm Community Action Corporation

NM

Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Corrective Action: SNMCAC will monitor administrative cost percentages against grant thresholds to ensure compliance. Person Responsible: Tracey Young, Fiscal Director Completion Date: March 31, 2026

View Audit 396867

Finding 1205202 (2025-001)

Material Weakness 2025

Sun Prairie Area School District

WI

Subrecipient Monitoring Allowable Costs / Cost Principles § 200.331 § 200.332

Finding #2025-001: #84.048 -Career and Technical Education - Basic Grants to States Federal Grantor Agency: U.S. Department of Education Compliance Requirement: Subrecipient Monitoring Condition: During our audit procedures, we noted that the District does not have formal, written procedures governi...

Finding #2025-001: #84.048 -Career and Technical Education - Basic Grants to States Federal Grantor Agency: U.S. Department of Education Compliance Requirement: Subrecipient Monitoring Condition: During our audit procedures, we noted that the District does not have formal, written procedures governing subrecipient monitoring. Although the District reviews supporting documentation—such as invoices—submitted by subrecipient schools prior to submitting claims to the Department of Public Instruction (DPI), these practices are not documented in an established policy or procedure. Criteria: Uniform Guidance (2 CFR 200.331–200.332) requires pass-through entities to establish and implement written procedures for monitoring subrecipients to ensure compliance with federal program requirements and achievement of performance goals. Cause: The District has not developed or implemented formal written policies and procedures for subrecipient monitoring. Effect: In the absence of formalized procedures, the District’s monitoring practices may be applied inconsistently, increasing the risk of unallowable costs, noncompliance with federal requirements, or misunderstandings between the District and its subrecipients. This could lead to questioned costs or administrative issues during oversight by DPI or other regulatory bodies. Recommendation: We recommend that the District develop and adopt formal written procedures outlining its subrecipient monitoring activities. These procedures should clearly describe monitoring responsibilities, required documentation, review steps, communication expectations, and follow-up actions. Implementing a formalized process will help ensure consistent oversight and compliance with federal regulations. Grantee Response: The District will develop and implement written procedures that outline the required monitoring steps, documentation standards, communication protocols, and follow-up expectations for subrecipient oversight. These procedures will align with the requirements of Uniform Guidance and DPI expectations.

View Audit 396861

Finding 1205195 (2025-002)

Material Weakness 2025

Gaudenzia Inc.

PA

Allowable Costs / Cost Principles Eligibility Material Weakness

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: HOME Investment Partnership Program Assistance Listing Number: 14.239 Pass-Through Agencies: City of Philadelphia, Redevelopment Authority: Venango – Loan Thompson Street – Loan County of Schuylkill - Home Investm...

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: HOME Investment Partnership Program Assistance Listing Number: 14.239 Pass-Through Agencies: City of Philadelphia, Redevelopment Authority: Venango – Loan Thompson Street – Loan County of Schuylkill - Home Investment Partnerships and Housing Trust Funds Programs: Fountain Springs - Loan Mayor and City of Baltimore: Baltimore Housing - Park Heights Women and Children - Loan Type of Finding: - Material Weakness in Internal Control over Compliance - Other Matters Condition: As part of the eligibility requirement for the HOME Investment Partnership program, we are required to review files of client residents who were provided residential drug and alcohol treatment services at the Organization’s locations in Venango (Re-Entry), Fountain Springs, Thompson Street, and Park Heights Women and Children. We sampled a total of 40 resident clients at these four locations covered by HOME loans and requested documentation within client resident files, including proof of residency, proof of income (low income or homeless). Of 40 resident client files reviewed, management could not provide proof of income or residency status for 16 clients, or policies and procedures manuals for 22 clients. Recommendation: We recommend that management adopt and implement formal policies and procedures to ensure compliance with HOME eligibility requirements. Such policies and procedures should include clear communication of compliance requirements between staff and locations, standardized documentation and processes for determining and verifying income eligibility during intake, and procedures for the redetermination of income eligibility for residential clients residing at a location for more than one year. Repeat Finding: 2024-001 Explanation of Disagreement with Audit Finding Management acknowledges the finding and continues to strengthen internal controls related to HOME program compliance, including eligibility documentation and file retention practices across all residential program locations. Management agrees that consistent documentation of eligibility, including proof of income and residency status (as applicable under HOME requirements), is critical. We are currently reviewing and enhancing intake procedures, documentation standards, and internal monitoring processes to ensure all required eligibility documentation is properly obtained, maintained, and uniformly applied across all locations. Action taken in response to finding: In response to the recommendation, management will develop and implement formalized policies and procedures to strengthen compliance with HOME requirements. These will include standardized guidance for eligibility determination at intake, clear documentation requirements across all sites, and procedures for ongoing eligibility review for clients residing in programs beyond one year. Name of the contact person responsible for corrective action: Dr. Deja Gilbert, PhD, MDA, FACHE, LPC, LMHC, President and CEO dgilbert@gaudenzia.org Planned completion date for corrective action plan: June 30, 2026

View Audit 396854

Finding 1205191 (2025-004)

Material Weakness 2025

Town of Elkton, Virginia

VA

Procurement, Suspension & Debarment Allowable Costs / Cost Principles

March 19, 2026 Greg Lunsford, Town Manager, respectfully submits the following corrective action plan for the year ended June 30, 2025. Name and address of independent public accounting firm: Brown, Edwards & Company, L.L.P. 1909 Financial Drive Harrisonburg, VA 22801 Audit period: June 30, 2025 The...

March 19, 2026 Greg Lunsford, Town Manager, respectfully submits the following corrective action plan for the year ended June 30, 2025. Name and address of independent public accounting firm: Brown, Edwards & Company, L.L.P. 1909 Financial Drive Harrisonburg, VA 22801 Audit period: June 30, 2025 The findings from the June 30, 2025 Schedule of Findings and Questioned Costs (the "Schedule") are discussed below. The findings are numbered consistently with the number assigned in the Schedule. Findings - Financial Statement Audit 2025-001: Material Audit Adjustments (Material Weakness) Condition During the audit, we detected material misstatements in the trial balance. Generally accepted auditing standards dictate that detection of errors in an audit is a strong indicator of a significant deficiency or material weakness. Accordingly, we are required to communicate this finding as such. Criteria The financial statements must be presented fairly, in all material respects. Cause The Town does not have a formal process for annual and monthly entries. Effect The financial information presented to us for the audit was missing or inaccurate. Recommendation We recommend that management implement processes to ensure accuracy of accounts. View of The Treasurer has drafted a Monthly Close Process and has been following it each month Responsible without fail. This has provided the opportunity to find errors and get them corrected in a Officials timely manner, which alleviates issues during the audit review. 2025-002: Segregation of Duties {Material Weakness) Condition Multiple duties in a transaction cycle are performed by the same individual. Consequently, errors or irregularities may occur and not be detected. Criteria Ideally, no individual would perform more than one duty in connection with any transaction or series of transactions. In particular, no one individual should have access to both physical assets and the related accounting records. Cause Incompatible duties and the limited number of staff. Effect A lack of separation of duties could allow error or fraud to go undetected. Recommendation While we understand that limited staff can make this difficult, controls should be in place to mitigate the risk. We have suggested specific controls in a separate communication. View of This continues to be a work in progress. The Treasurer has divided up the duties among her Responsible employees. Now one employee is processing the utility bills and two other employees are Officials collecting/inputting payments. 2025-003: Annual and Monthly Close Process (Material Weakness) Condition The Town does not have a complete monthly or annual close process in place that accurately reflects all needed adjustments. Criteria Each period should be closed to properly reflect accruals or other transactions not previously recorded to ensure the period reporting is materially correct. Cause The annual and monthly close process does not currently capture adjustments needed for all accruals. Effect Material audit adjustments were required. Recommendation We recommend the Town improve a monthly and annual close process to ensure financial records are accurate and complete. View of The Treasurer has drafted a Monthly Close Process and has been following it each month Resp onsi ble without fail. This has provided the opportunity to find errors and get them corrected in a Officials timely manner, which alleviates issues during the audit review. The Treasurer is also drafting an Annual Close Process that will assist with collecting information for review by the auditing firm. Findings and Questioned Costs - Major Federal Award Programs Audit 2025-004: Federal Procurement Policies Condition The policy created in 2024 specific to the federal awards cost principle requirements under Uniform Grant Guidance is not compliant. Criteria Federal award recipients must have written policies, procedures, and standards of conduct as required by 2 CFR 200, Subparts D and E. Cause Certain required policies under 2 CFR 200, Subparts D and E are not present. Effect Lack of compliant policies may create noncompliance with regulations as stated requirements may not be followed. Recommendation Develop compliant procurement policy that meets federal st an dards . View of The Treasurer will review the Policy and submit recommended edits to the Town Council for Responsible review and approval. Officials If the Federal Audit Clearinghouse has questions regarding this plan, please call Donna Curry, Treasurer at 540-298-1951.

View Audit 396850

Finding 1205150 (2025-032)

Material Weakness 2025

State of Arkansas

AR

Allowable Costs / Cost Principles Eligibility Special Tests & Provisions

Views of Responsible Officials and Planned Corrective Action: Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. For Sample Items 3, 5, 30, 37, and 40, DMS is currently developing system upgrades that will establish a revalidation date that is 60 days prior ...

Views of Responsible Officials and Planned Corrective Action: Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. For Sample Items 3, 5, 30, 37, and 40, DMS is currently developing system upgrades that will establish a revalidation date that is 60 days prior to the revalidation expiration date and auto-terminate providers at the time of their revalidation expiration date if they have not successfully completed the revalidation process. For Sample Item 24, DMS is currently developing a system change to reinstitute revalidation requirements for Early Intervention Day Treatment and Adult Developmental Day Treatment providers. Anticipated Completion Date: 6/30/2026 Contact Person: Name: Elizabeth Pitman Title: Director, Division of Medical Services Agency: Department of Human Services Address: 700 Main Street City, State, Zip: Little Rock, AR 72201 Phone Number: 501-244-3944 Email Address: Elizabeth.Pitman@dhs.arkansas.gov

View Audit 396807

Finding 1205145 (2025-027)

Material Weakness 2025

State of Arkansas

AR

Allowable Costs / Cost Principles Eligibility Special Tests & Provisions

Finding Number: 2025-027 ALN Number(s) and Program Title(s): 93.767 – Children’s Health Insurance Program Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. For Sample Items 8, 11, and 28, DMS is currently developing system upgrades that will establish a rev...

Finding Number: 2025-027 ALN Number(s) and Program Title(s): 93.767 – Children’s Health Insurance Program Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. For Sample Items 8, 11, and 28, DMS is currently developing system upgrades that will establish a revalidation date that is 60 days prior to the revalidation expiration date and auto-terminate providers at the time of their revalidation expiration date if they have not successfully completed the revalidation process. For Sample Item 30, a site visit has been completed for the provider. The process used for completion of site visits has been updated to address the cause for the delayed site visit. For Sample Item 12, DMS has implemented a system change to electronically collect information contained on the W-9 form which will eliminate the need for provider to submit the form. DHS is in the process of promulgating this policy change. Anticipated Completion Date: 6/30/2026 Contact Person: Name: Elizabeth Pitman Title: Director, Division of Medical Services Agency: Department of Human Services Address: 700 Main Street City, State, Zip: Little Rock, AR 72201 Phone Number: 501-244-3944 Email Address: Elizabeth.Pitman@dhs.arkansas.gov

View Audit 396807

Finding 1205138 (2025-020)

Material Weakness 2025

State of Arkansas

AR

Student Financial Aid Subrecipient Monitoring Allowable Costs / Cost Principles

Finding Number: 2025-020 ALN Number(s) and Program Title(s): 93.658 – Title IV-E Foster Care Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. The reconciliation process will be revised to specify steps to identify clients that are eligible to receive Title...

Finding Number: 2025-020 ALN Number(s) and Program Title(s): 93.658 – Title IV-E Foster Care Views of Responsible Officials and Planned Corrective Action: DHS concurs with this finding. The reconciliation process will be revised to specify steps to identify clients that are eligible to receive Title IV-E funding and the process to update their IV-E status. The agency could not make the necessary corrections in AASIS when notified of the deficiency due to the expenses being posted in the prior fiscal year. All necessary adjustments will be made on the quarterly report for the period ending on 3/31/26. Anticipated Completion Date: 4/30/26 Contact Person: Name: Tiffany Wright Title: Director, Division of Children and Family Services Agency: Department of Human Services Address: 700 Main Street City, State, Zip: Little Rock, AR 72201 Phone Number: 501-396-6477 Email Address: Tiffany.Wright@dhs.arkansas.gov

View Audit 396807

Finding 1205130 (2025-016)

Material Weakness 2025

State of Arkansas

AR

Subrecipient Monitoring Allowable Costs / Cost Principles § 200.332

Finding Number: 2025-016 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO acknowledges the auditor’s observation regarding the sequencing of the technical close-out letter and subsequent expenditures for...

Finding Number: 2025-016 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO acknowledges the auditor’s observation regarding the sequencing of the technical close-out letter and subsequent expenditures for one project. ASBO respectfully clarifies that a Technical Close-Out Letter reflects that the primary network infrastructure has been constructed and service capability established. It does not necessarily signify final project completion for all eligible cost components under the grant agreement. Project completion for reporting purposes occurs upon final reporting to the U.S. Department of the Treasury. In October 2025, the subrecipient requested approval to perform additional network equipment upgrades using remaining grant funds. ASBO obtained written confirmation from the U.S. Department of the Treasury Senior Federal Program Officer that the identified OLT upgrade constituted an eligible network component necessary to deliver service and was not maintenance. No additional grant funds were awarded for this work; the proposal involved remaining grant balances. It should be noted that as of the date of audit review, no expenses had been incurred related to the proposed upgrade. As such, ASBO does not concur that the identified $2,096,990 represents ongoing maintenance costs or unallowable expenditures. In fact, all reimbursements to date include eligible network build-out costs incurred prior to “technical closeout” but financially processed after that date, or fiber-to-the-home (FTTH) drops. FTTH drops have been an allowable expense in the Arkansas CPF Program following technical closeout yet prior to reporting the project complete to U.S. Treasury. The misclassification of these costs as maintenance appears to stem from an assumption that they were related to the proposed network upgrade, when in actuality, they were not. To avoid ambiguity in future projects, ASBO will formalize procedures clarifying the distinction between technical close-out, formal project completion, and eligible use of remaining funds. Any Treasury-approved scope clarifications or post-close-out adjustments will be formally documented prior to reimbursement to ensure alignment between technical certification and financial reporting. Anticipated Completion Date: June 30, 2026 Contact Person: Name: Glen Howie Title: State Broadband Director Agency: Arkansas State Broadband Office Address: 1 Commerce Way City, State, Zip: Little Rock, AR 72202 Phone Number: 501-683-6000 Email Address: broadband@arkansas.gov

View Audit 396807

Finding 1205126 (2025-012)

Material Weakness 2025

State of Arkansas

AR

Subrecipient Monitoring Allowable Costs / Cost Principles § 200.332

Finding Number: 2025-012 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO acknowledges the auditor’s observation regarding the execution of subaward agreements with ISP entities that are wholly owned sub...

Finding Number: 2025-012 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO acknowledges the auditor’s observation regarding the execution of subaward agreements with ISP entities that are wholly owned subsidiaries of electric cooperatives and the related affiliate payment structure. Subaward agreements were executed with legally distinct ISP entities holding unique entity identifiers (UEIs) and responsible for performance under the Capital Projects Fund (CPF) award. In certain instances, affiliated parent entities processed invoice payments as part of established intercompany accounting practices. These arrangements reflected corporate structure and operational efficiencies rather than an intent to shift accountability or bypass program requirements. ASBO notes that no questioned costs were identified and that project deliverables were completed in accordance with the terms of the award. The ISP entities remained responsible for reporting, certification, and compliance under the executed agreements. ASBO recognizes, however, that clearer documentation of intercompany payment flows would strengthen audit traceability and reduce ambiguity regarding which legal entity incurred and paid specific costs. To enhance documentation clarity, ASBO will require subrecipients with affiliated entities to maintain documented intercompany reconciliations where applicable and will update subaward templates to further clarify entity-level responsibility for payment, ownership, and record retention. Internal review procedures will also be reinforced to ensure alignment between invoicing practices and designated subrecipient entities. Anticipated Completion Date: June 30, 2026 Contact Person: Name: Glen Howie Title: State Broadband Director Agency: Arkansas State Broadband Office Address: 1 Commerce Way City, State, Zip: Little Rock, AR 72202 Phone Number: 501-683-6000 Email Address: broadband@arkansas.gov

View Audit 396807

Finding 1205125 (2025-011)

Material Weakness 2025

State of Arkansas

AR

Allowable Costs / Cost Principles Cash Management § 200.405

Finding Number: 2025-011 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: Administrative costs charged to CPF were program-related and remained within the statutory administrative cap. ASBO acknowledges, howe...

Finding Number: 2025-011 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: Administrative costs charged to CPF were program-related and remained within the statutory administrative cap. ASBO acknowledges, however, that documentation supporting the internal methodology used to allocate administrative costs across multiple broadband funding streams was not sufficiently formalized during the period reviewed. The identified variance of $22,516 reflects an administrative reconciliation issue rather than an unallowable expenditure, and the variance amount was reduced from a subsequent administrative cost drawdown. Moving forward, the team will more formalize its administrative cost allocation methodology to include a narrative explanation to support allocation percentages, as well as authorizing signatures. Anticipated Completion Date: June 30, 2026 Contact Person: Name: Glen Howie Title: State Broadband Director Agency: Arkansas State Broadband Office Address: 1 Commerce Way City, State, Zip: Little Rock, AR 72202 Phone Number: 501-683-6000 Email Address: broadband@arkansas.gov

View Audit 396807

Finding 1205124 (2025-010)

Material Weakness 2025

State of Arkansas

AR

Subrecipient Monitoring Allowable Costs / Cost Principles § 200.201 § 200.403

Finding Number: 2025-010 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO respectfully notes that Treasury’s SLFRF and CPF Supplementary Broadband Guidance provides that ISPs receiving fixed amount subaw...

Finding Number: 2025-010 ALN Number(s) and Program Title(s): 21.029 – Coronavirus Capital Project Funds Views of Responsible Officials and Planned Corrective Action: ASBO respectfully notes that Treasury’s SLFRF and CPF Supplementary Broadband Guidance provides that ISPs receiving fixed amount subawards for broadband infrastructure projects are not required to comply with the cost principles of 2 CFR Part 200, Subpart E (see U.S. Department of the Treasury, SLFRF and CPF Supplementary Broadband Guidance, available at: https://home.treasury.gov/system/files/136/SLFRF-and-CPF-Supplementary-Broadband-Guidance.pdf) Further, the guidance states, “...[m]ore specifically, subawards that provide for a maximum payment amount that is calculated based on a reasonable estimate of actual cost (see 2 CFR 200.201(b)(1)) will be considered fixed amount subawards even if the subaward agreement also provides that payments to the ISP subrecipient will be limited to actual costs after review of evidence of costs.” Arkansas’ CPF subawards meet these criteria. In short, relative to the applicability of cost principles under the Uniform Guidance, U.S. Treasury treats Arkansas’ CPF subawards as fixed amount subawards, exempting cost principles. Accordingly, ALA’s citation to §200.403(g) under Subpart E is not directly applicable to Arkansas’ CPF Program. Nevertheless, while ASBO maintains that the cost principles standard noted above does not apply to the awards in question, the office conducted a detailed review of the invoices identified. That review determined the following: • A substantial portion of the invoices were specific to approved CPF projects and included subrecipient certification statements affirming project use. • Certain invoices flagged as insufficiently detailed included annotations or supporting documentation sufficient to trace costs to the relevant project. • Invoices identified as potential duplicates were, in several cases, attributable to mixed inventory usage (allowed under GAAP) or subsequent credit/refund adjustments. • A limited subset of invoices (approximately $47,047.79) may require further reconciliation due to a known calculation variance. This funding may be returned, if deemed necessary. ASBO does not concur that the invoices totaling $6,666,409 represent unallowable expenditures. Rather, the observation reflects differences in documentation presentation, invoice formatting, and inventory accounting practices. The office maintains that the costs were associated with eligible broadband infrastructure activities under CPF. Further, in accordance with 2 CFR § 200.201(b)(1), the CPF broadband projects reviewed were monitored through routine oversight and reporting. To strengthen documentation consistency and audit traceability, ASBO is implementing a standardized reimbursement checklist requiring clearer identification of project attribution and supporting documentation prior to approval. Anticipated Completion Date: June 30, 2026 Contact Person: Name: Glen Howie Title: State Broadband Director Agency: Arkansas State Broadband Office Address: 1 Commerce Way City, State, Zip: Little Rock, AR 72202 Phone Number: 501-683-6000 Email Address: broadband@arkansas.gov

View Audit 396807

Finding 1205122 (2025-008)

Material Weakness 2025

State of Arkansas

AR

Allowable Costs / Cost Principles Subrecipient Monitoring Cash Management § 200.403

Finding Number: 2025-008 ALN Number(s) and Program Title(s): 21.027 – COVID 19: Coronavirus State and Local Fiscal Recovery Fund (CSLFRF) Views of Responsible Officials and Planned Corrective Action: During the audit, initial evidence was submitted, including monthly and daily logs from vendor coach...

Finding Number: 2025-008 ALN Number(s) and Program Title(s): 21.027 – COVID 19: Coronavirus State and Local Fiscal Recovery Fund (CSLFRF) Views of Responsible Officials and Planned Corrective Action: During the audit, initial evidence was submitted, including monthly and daily logs from vendor coaches to verify coaching activities. Additional documentation, including daily logs obtained from vendors, is available for review. Adjustments and recommendations that have resulted from this audit will be incorporated into future processes and requirements for vendor coaches, to further strengthen our oversight and ensure ongoing adherence to required standards. There are procedures put into place to monitor vendor adherence to scheduled coaching days, with vendors consistently held to a high standard and expectation to fully complete contracted days by requiring vendors to do the following: • Submit monthly evidence of coaching activities that align with contracted days. The Division Received monthly summaries from vendors detailing coaching support, activities, and specific dates when coaching was provided. • Conduct scheduled site visits with state content leaders • Complete monthly walkthroughs with school leaders, with consistency of walkthrough data being outcomes-based and providing tangible evidence that coaching actions directly supported the improvement of instructional programs. Data is collected through Jot Form and displayed on an Air Table Dashboard. This has been maintained since 2023. • Hold ongoing meetings with district staff to review outcomes and address improvement areas, ensuring fulfillment of literacy coaching contracts under Agency requirements Transparency and compliance remain a priority. Required documentation will continue to be accessible to support any future reviews. Anticipated Completion Date: Continuous. Contact Person: Name: Greg Rogers Title: Chief Fiscal Officer Agency: DESE Address: 4 Capitol Mall, Room 204-A City, State, Zip: Little Rock, AR 72201 Phone Number: 501-682-4475 Email Address: Greg.Rogers@ade.arkansas.gov

View Audit 396807

Finding 1205097 (2025-003)

Material Weakness 2025

Puerto Rico Safe Drinking Water Treatment Revolving Loan Fund

PR

Cash Management Allowable Costs / Cost Principles § 200.302 § 200.303

The PRDOH agreed with the findings and is working with the Finance Department to establish and strengthen our internal controls to ensure all payments comply with the guidelines established by the Federal Government. On the other hand, PRDOH is working and verifying our written procedures to ensure ...

The PRDOH agreed with the findings and is working with the Finance Department to establish and strengthen our internal controls to ensure all payments comply with the guidelines established by the Federal Government. On the other hand, PRDOH is working and verifying our written procedures to ensure that payments are issued promptly after the drawdown is made.

View Audit 396776

Finding 1205069 (2025-001)

Material Weakness 2025

Economic and Community Development Institute, Inc.

OH

Allowable Costs / Cost Principles Reporting Matching / Level of Effort / Earmarking

Condition: During our testing of allocated salaries and wages, we identified errors in how employee time was allocated to the program, and salaries and wages allocated to the program in excess of the Executive Level II Salary maximum. One employee in each program, 59.046 and 93.570, had an inappropr...

Condition: During our testing of allocated salaries and wages, we identified errors in how employee time was allocated to the program, and salaries and wages allocated to the program in excess of the Executive Level II Salary maximum. One employee in each program, 59.046 and 93.570, had an inappropriate wage rate applied to allocated time to the program. Additionally, for the 59.046 program only, one employee had compensation levels allocated to the program in excess of the Executive Level II Salary maximum amount in effect for the respective period. Planned Corrective Action: ECDI will put additional steps in place related to the Payroll Review process to ensure reconciliation of payroll charges to actual time records and rates. The organization will modify its calculations to ensure that pay rates are reflective of the timeframe in question (not for periods before or after). ECDI will update its calculations to include thresholds for Executive pay so they are not entered more than approved rates. The company is also exploring technology enhancements so that information from ECDI’s Payroll system flows directly into ECDI’s Accounting system to limit the chance of errors during extraction from Payroll system and uploading into Accounting system. Contact Person Responsible for Corrective Action: David Chew and Hudu Ahmed. Completion Date: In process

View Audit 396710

Finding 1205040 (2025-002)

Material Weakness 2025

New London Homeless Hospitality Center, Inc.

CT

Allowable Costs / Cost Principles

In the past month we have recruited a new Chief Administrative Officer with experience in financial management. By May we are scheduled to add a full charge accountant to our staff. With these staffing additions, we will be able to complete ongoing reviews of compliance with our cost allocation plan...

In the past month we have recruited a new Chief Administrative Officer with experience in financial management. By May we are scheduled to add a full charge accountant to our staff. With these staffing additions, we will be able to complete ongoing reviews of compliance with our cost allocation plan.

View Audit 396681

Finding 1205013 (2025-001)

Material Weakness 2025

New London Homeless Hospitality Center, Inc.

CT

Allowable Costs / Cost Principles Cash Management Reporting

While all the costs reported to grantors were fully allowable per our contract, we continued to have some challenges in reflecting these costs in QuickBooks at the detailed level. We have implemented several accounting improvements that have addressed most of the differences between our cost reports...

While all the costs reported to grantors were fully allowable per our contract, we continued to have some challenges in reflecting these costs in QuickBooks at the detailed level. We have implemented several accounting improvements that have addressed most of the differences between our cost reports by contract and QuickBooks. We continue, however, to face challenges in allocating indirect costs (allowed by a contract) down to the level of individual contract accounts in QuickBooks. The second continuing challenge is allocation of certain fringe benefits such as employee savings match and contributions to Health Savings Accounts down to the contract level for staff who work on multiple contracts. In the past month we have added new staff with greater experience in accounting and are implementing new ongoing reviews that will assure that our QuickBooks information remains exactly in sync with our fiscal reports.

View Audit 396681

Finding 1204978 (2025-003)

Material Weakness 2025

Puerto Rico Medical Services Administration

PR

Reporting Subrecipient Monitoring Allowable Costs / Cost Principles § 200.302 § 200.303 § 200.305 § 200.328 § 200.329

Conduct a full review of all FEMA funds received in FY 2024-2025 to properly reclassify them as Federal Revenue/Income in the General Ledger. Implement a mandatory review of FEMA Project Worksheets (PWs) and Obligation Notifications to distinguish between "Reimbursements" and "Capital Advances" upon...

Conduct a full review of all FEMA funds received in FY 2024-2025 to properly reclassify them as Federal Revenue/Income in the General Ledger. Implement a mandatory review of FEMA Project Worksheets (PWs) and Obligation Notifications to distinguish between "Reimbursements" and "Capital Advances" upon receipt. Create separate General Ledger (GL) accounts for FEMA disaster/project and Federal Funds to track expenditures vs. drawdowns in real-time. Establish a semi-annual meeting between the FEMA Coordinator and Finance departments to verify that all FEMA-funded work performed matches the reported expenditures. Update the SEFA preparation process to ensure FEMA expenditures are reported in the period they were incurred, regardless of when the reimbursement was received. Provide specialized training for the finance team on Federal Funds accounting.

View Audit 396649

Finding 1204966 (2025-002)

Material Weakness 2025

City of Manteca

CA

Allowable Costs / Cost Principles Cash Management

Finding #SA2025-002 Unallowable Expenditures Charged to the Grant Assistance Listing Number: 20.507, 20.526 Assistance Listing Title: COVID-19 – Federal Transit Formula Grants (Urbanized Area Formula Program) – Federal Transit Cluster Name of Federal Agency: Department of Transportation Federal Awar...

Finding #SA2025-002 Unallowable Expenditures Charged to the Grant Assistance Listing Number: 20.507, 20.526 Assistance Listing Title: COVID-19 – Federal Transit Formula Grants (Urbanized Area Formula Program) – Federal Transit Cluster Name of Federal Agency: Department of Transportation Federal Award Identification Number: CA-2022-083-00, 2020-206, 2020-212 • Name(s) of the contact person: Melissa Munoz, Interim Assistant Finance Director • Corrective Action Plan: The City will develop procedures for grant management, accounting and reporting to ensure that only allowable costs are claimed. • Anticipated Completion Date: 06/30/2026

View Audit 396634

Finding 1204955 (2025-001)

Material Weakness 2025

Casa Blanca Community School, Inc.

AZ

Allowable Costs / Cost Principles § 200.430

Finding Number: 2025‐001, 2024‐002 Program Name/Assistance Listing Title: Indian School Equalization Program Assistance Listing Number: 15.042 Contact Person: Eloyce Gillespie, Business Manager Anticipated Completion Date: February 20, 2026 Planned Corrective Action: Casa Blanca Community School com...

Finding Number: 2025‐001, 2024‐002 Program Name/Assistance Listing Title: Indian School Equalization Program Assistance Listing Number: 15.042 Contact Person: Eloyce Gillespie, Business Manager Anticipated Completion Date: February 20, 2026 Planned Corrective Action: Casa Blanca Community School completed the required review process in accordance with the established procedure, however, the error still occurred due to a system limitation. Specifically, although staff followed the process and performed the required review, the system does not currently flag or prevent adjustments that exceed the allowable threshold from being rolled into the next fiscal year. Because this condition is not automatically identified or restricted by the system, the adjustment was able to process despite the control being executed. To address this, the School will work with the system support team to evaluate options for adding automated validation or warning to prevent adjustments from rolling into the next fiscal year when limits are exceeded, which will include manual review. These actions were completed by February 20, 2026, and the process owner will monitor compliance.

View Audit 396606

Finding 1204947 (2025-001)

Material Weakness 2025

Garfield County School District No. 16

CO

Allowable Costs / Cost Principles School Nutrition Programs Cash Management § 200.302 § 200.403

Garfield County School District No. 16 respectfully submits the following corrective action plan for the year ended June 30, 2025. Finding 2025-001 Reporting Significant Deficiency in Internal Control over Compliance and Other Non-Compliance Corrective Action: The District agrees with the finding re...

Garfield County School District No. 16 respectfully submits the following corrective action plan for the year ended June 30, 2025. Finding 2025-001 Reporting Significant Deficiency in Internal Control over Compliance and Other Non-Compliance Corrective Action: The District agrees with the finding related to insufficient supporting documentation for the National School Lunch Program reimbursement claims, as it related to sack lunches/field meals. Personnel Responsible for Corrective Action: Jody Williams, Food Service Director Anticipated Completion Date: The District has corrected this issue as of the date of this report, and now requires formal written requests for all sack lunches/field meals, to ensure counts are properly documented.

View Audit 396571

Finding 1204927 (2025-001)

Material Weakness 2025

Glen Oaks Community College

MI

Allowable Costs / Cost Principles Reporting Significant Deficiency

Improper Period Recognition of SEFA Expenses Auditor Description of Condition and Effect. During our testing of compliance and related controls, we identified instances where expenses covering service periods extending beyond the fiscal year under audit were recorded in full rather than prorated for...

Improper Period Recognition of SEFA Expenses Auditor Description of Condition and Effect. During our testing of compliance and related controls, we identified instances where expenses covering service periods extending beyond the fiscal year under audit were recorded in full rather than prorated for the portion incurred during the fiscal year. This resulted in an initial overstatement of expenses reported on the Schedule of Expenditures of Federal Awards (SEFA). Initial SEFA amounts were not accurately stated in accordance with accrual accounting requirements. Auditor Recommendation. We recommend the College implement procedures to ensure expenses are recorded in the proper period in accordance with GAAP and Uniform Guidance requirements. Corrective Action. The Controller will review supporting documentation during the completion of the SEFA, which will then be reviewed by a second, qualified individual to ensure GAAP is being followed and that expenses are only being recorded when incurred. Responsible Person. Jennifer Dodson, Controller Anticipated Completion Date. June 30, 2026

View Audit 396536

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