Corrective Action Plans

Cash Management Services for Victims of Human Trafficking – Assistance Listing No. 16.320 Recommendation: We recommend the Organization design controls to ensure the draw down requests and related support are formally reviewed and approved by the Executive Director before submitting the request to the awarding agency and that the support is retained. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned in response to finding: The Organization has implemented a formal review and approval process, as outlined in the board-approved Financial Management Policy & Procedure Manual, to ensure all draw down requests and supporting documentation are reviewed and approved by the Executive Director prior to submission to the awarding agency, with all approved support retained on file. This process is in practice as of the date of this letter, with corrective actions continuing as needed to ensure effectiveness. Name of the contact person responsible for corrective action: Megan Mattimoe, Executive Director Planned completion date for corrective action plan: December 31, 2025

2024-002 Capital Fund Drawdowns Federal Program: Public and Indian Capital Fund Program, Federal Assistance Listing No. 14.872 Criteria: Under federal guidelines, the capital fund program operates as a reimbursement grant. As such, all amounts must be committed or spent prior to their drawdown. Condition: The entity is required to expend funds as they are drawn down from its capital fund program. As of the end of the fiscal year, drawdowns exceeded recorded expenses by $82,043. As of the end of the fiscal year, this amount is showing as unearned revenue and has not been expended. Questioned Costs: None Effect: Amounts were drawn down in an amount that exceeded the documented expenses for the capital fund program. Cause: The PHA drew down funds in anticipation of spending them but they were not spent at year end. Recommendation: The PHA should ensure that all funds are expended prior to being drawn down. Views of responsible officials and planned corrective actions: We will ensure that all future draws are supported by documentation and are spent as the funds are received. Expected correction date is December 31, 2025.

U.S. Department of Justice 2024-005 Congressionally Mandated Awards – Assistance Listing No. 16.753 Recommendation: We recommend that the County develop internal controls and procedures to ensure drawdowns are performed in a manner to minimize the time between drawing and disbursing federal funds Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Fiscal Clerk has been trained on proper drawdown of grant funds and accurate recording of expenditures. Name of the contact person(s) responsible for corrective action: District Attorney Fiscal Clerk Planned completion date for corrective action plan: 12/31/25

Recommendation: We recommend that all invoices are paid timely to avoid late fees. Action Taken: We agree with the auditor and will take under advisement. Anticipated Date of Completion: December 31, 2025

Finding Number: 2024-001 Finding Title: Cash Management - WIC Reimbursement to Member Counties Program: Special Supplemental Nutrition Program for Women, Infants, and Children Name of Contact Person Responsible for Corrective Action : Brandon Nelson Corrective Action Planned: Set up an internal policy where any payment remittance advices' must be responded to and completed within two weeks of receipt to ensure that payments are deposited, and member counties of the CHB are reimbursed for the expenses that were submitted for in a prompt manner. Anticipated Completion Date: August 15, 2025

Findings Reported by Uniform Guidance – The following steps have been taken or will be taken to address Finding 2024-008: • Heart City Health Center, Inc. will improve its understanding on matching principles on federal grant programs to ensure proper compliance with future grants • Heart City Health Center, Inc. started the discussion with HRSA on this funding and will continue to work with them on this funding

Findings Reported by Uniform Guidance – The following steps have been taken or will be taken to address Finding 2024-007: • Heart City Health Center, Inc. will continue to improvement knowledge and understanding of grant requirements as / if new funding is received to avoid allocating unallowed expenses to the grant reimbursement • Heart City Health Center, Inc. started the discussion with HRSA on this funding and will continue to work with them on this funding

Findings Reported by Uniform Guidance – The following steps have been taken or will be taken to address Finding 2024-004: • Heart City Health Center, Inc. will refine and change controls that deal with tracking of when expenses are incurred to confirm that no drawdown receipt is received before then or in the incorrect grant period

US Department of Agriculture Federal Financial Assistance Listing #10.558 Child and Adult Food Care Program (CACFP) Applicable Federal Award Number and Year – 28-1183-000 7/1/2023 – 6/30/2024 and 7/1/2024 – 6/30/2025 Cash Management Material Weakness in Internal Control Over Compliance Criteria: CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Condition: The Organization was unable to provide adequate documentation to support the number of meals claimed for reimbursement. Corrective Action Plan: Management is in the process of reviewing its existing controls over the tracking and submitting of its meal counts included in its attendance records for reimbursement. Individual Responsible For Corrective Action: Veronica Jones, Fiscal Services Director Anticipated Completion Date: December 31, 2025

The Center is working on paying off its vendors of which older payables are still outstanding, and will establish procedures to ensure timely disbursement of funds upon receipt to vendors going forward.

The Center has subsequently engaged with a third-party organization to help review the Center's monthly vouchers submitted for reimbursement to help ensure proper and timely vouchering.

The Center is implementing reconciliations of the grant expenditures to the general ledger.

Finding 2024-002: Material weakness in internal controls over compliance – cash management Recommendation: Management should improve the monitoring of actual expenditures ot better algin cash needs and draw down requests with actual expenditures incurred. Explanation of Disagreement with Audit Finding: There is no disagreement with the audit finding. Action planned in response to the finding: In April of 2024, KRJC established a financial policy that ensures that funds are only drawn down for expenses incurred and/or accrued during the reporting period. All expenses are booked into KRJC’s accounting system. KRJC then calculates any funding due from BJA and then completes a draw down for any payments due. In an effort to ensure that funds are never overdrawn but that KRJC can pay sub-awardees and contracts in a timely manner, this process may occur multiple times in any given quarter. In addition, KRJC has worked to develop a pool of unrestricted funds and is working to develop an operating reserve, using private funds, that will allow the organization some additional flexibility in our financial operations and will ultimately allow KRJC to shift to quarterly drawdowns. Planned completion date for corrective action plan: July 2024

Veterans Place of Washington Boulevard, Inc. submits the following corrective action plan for the year ended December 31, 2024. Name and address of independent public accounting firm: Herbein + Company, Foster Plaza 10, 680 Andersen Drive, Suite 205, Pittsburgh, PA 15220 Audit period: Year ended December 31, 2024 The finding from the December 31, 2024 schedule of findings and questioned costs are discussed below. The finding is numbered consistently with the number assigned in the schedule. Section III - Federal Award Findings and Questioned Costs 2024-001 MISSING DOCUMENTATION AND DUPLICATE INVOICE SUBMISSION - MATERIAL WEAKNESS Federal Program Economic Development Initiative, Community Project Funding and Miscellaneous Grants - ALN 14.251 Criteria In order to be allowable under federal awards, costs must meet general criteria, which includes adequate documentation. Under OMB guidance, Public Law (Pub. L) No. 116-117, Payments Integrity Information Act of 2019, and Executive Order 13520 on reducing improper payments, federal agencies are required to take actions to prevent improper payments, review federal awards for such payments, and as applicable, recover improper payments, including any duplicate payment. Condition While performing tests over activities allowed or unallowed and allowable costs/cost principles, we noted documentation for one invoice charged to the grant could not be located. As a result, we were unable to determine that the cost was allowable per the terms of the grant award. We also noted that a second invoice charged to the grant was submitted for reimbursement twice. Cause This is a new grant in the current year to cover the portion of the cost for a new building. While management submitted invoices to the Department of Housing and Urban Development for review and approval prior to reimbursement, they did not maintain a record of the costs submitted for each reimbursement request by either listing the invoices and amounts charged or other means. Effect The Organization was unable to provide documentation for one of the invoices charged to the program, and a second invoice was charged to the program twice. Questioned Costs $54,461 Context The grant was for a portion of construction costs with the difference coming from donations or other assets of Veterans Place of Washington Boulevard, Inc. In order to receive reimbursement for expenses, the Organization was required to submit invoices to the Department of Housing and Urban Development (HUD) for approval prior to uploading the invoices for reimbursement. The expenses in question were approved by HUD prior to requesting or receiving reimbursement. Furthermore, there were approximately $96,000 of construction costs that were incurred but not reimbursed by HUD that appear to meet the terms and conditions of the grant. Repeat Finding No Recommendation We recommend that detailed documentation of the costs submitted for reimbursement are maintained in a separate file so that costs charged to the program are easily identified. Management Response In the situation concerning our inability to identify invoices associated with a requested reimbursement, costs for a particular area were submitted for review and approval by HUD and the costs were not clearly attributed to one singular invoice but reflected as portions of the total invoice submitted by one vendor. In the future, when requesting reimbursement, costs will be more clearly indicated to a specific invoice and identified so they can be more easily tracked. In the case of a duplicate invoice, we typically checked against our records of paid invoices and in this case, our belief was that it was paid but not marked as submitted for reimbursement. In the future, invoices will be verified against both our record of paid invoices as well as a separate record of reimbursed invoices.

Management agrees with the finding and has developed and will implement the appropriate policies and procedures by December 31, 2025.

Management agrees with the finding and in the summer of 2024, contracted with an accounting company to provide services.

Audit Finding: During the 2024 audit, it was noted that there was a miscalculation in the facility use expenses charged to grants. While the error was not material, it highlights a need for improved oversight to prevent future errors. Root Cause: The spreadsheet used to calculate facility use expenses was not reviewed or verified by a second party prior to posting, which led to a calculation error. Corrective Action: Beginning in Quarter 4 of 2025, the facility use expense calculation spreadsheet will be reviewed and verified by a second staff member prior to submission or charging to grants. The reviewer will sign off (physically or electronically) to confirm accuracy of the calculation and grant allocation. Responsible Parties: Allison Hrestak, COO Tina Fornstrom, Business Manager Implementation Date: October 1, 2025 (start of Q4 2025) Ongoing Monitoring: The COO will conduct periodic spot checks (quarterly) to ensure the review and sign-off process is consistently followed. The Business Manager will conduct monthly reviews on the SALBENT AX workbook and facility use workbook for accuracy. Expected Outcome: This added level of review is expected to prevent future calculation errors, ensure accurate cost allocations to grants, and strengthen internal controls related to expense tracking.

Recommendation – The Project should ensure the surplus cash calculation is made in a manner that allows for a timely deposit of any required deposit to the residual receipts account. If there are cash flow issues preventing the deposit from taking place, the Project needs to contact HUD and request a waiver if allowed. Views of Responsible Officials and Planned Corrective Actions –Management will calculate an estimated surplus cash calculation amount and deposit them into the residual receipts account within the required time frame. Name and Title of Responsible Official – Sabine Cox, Comptroller Anticipated Completion Date – Once the funds are received.

Corrective Action Plan: The ARC of Delaware will ensure that there are appropriate procedures in place to ensure that the required calculation of surplus cash is completed with 60-days of year end. ARC of Delaware will also ensure that individuals have appropriate access to HUD Reporting tools to ensure timely calculation. Contact Person Responsible for Correction Action: Stanley Kihara, Controller Completion Date:

Management will implement a dual-review process for payroll submissions, requiring both supervisor approval of timecards and accounting verification against payroll system reports. Supervisors and payroll staff will undergo training on compliance requirements. Ongoing random spot checks will be performed to ensure consistency and accuracy, and to confirm compliance.

Management will enforce a standardized reimbursement packet review checklist, requiring documented approval prior to submission. All reimbursement packets will be stored electronically in a central repository. Training will be provided to all accounting staff on documentation standards. Periodic supervisory reviews will be performed to confirm compliance.

Corrective Action Planned: The organization has been using the Microsoft Approvals app to capture approvals of expenditure reports and requests for drawdowns, in addition to the frequent weekly review meetings and approvals process to satisfy Uniform Guidance 2 CFR 200.511c and for Single Audit evidence. Name(s) of Contact Person(s) Responsible for Corrective Action: Stefanie Boles, Chief Administrative Officer; Patrick Ma, Vice President for Finance and Business Operations Anticipated Completion Date: This change has already taken place as of September 2025.

The exceptions resulted from delays in updating payroll/timekeeping systems and insufficient documentation to support allocation changes. To correct this, TRAC has implemented a Position Control Update process: any change to an employee’s grant allocation must be documented on a Position Control Update form, signed by the Finance Director, and entered into the payroll system within 5 business days of the change. Additionally, the Finance team performs monthly reconciliations between timecards, payroll registers, and the general ledger to ensure that payroll charges are accurate and properly supported before being billed to grants. Completion Date: October 1, 2025. Responsible Parties: Nicole Binkley, Chief Executive Officer Josh Runnels, Director of Finance and Operations

The Organization will continue efforts to obtain written confirmation from the Department of Commerce, compile all available email correspondence and notes from verbal conversations, and prepare a detailed timeline of authorization requests and responses. Further, the Organization will submit a formal response to the Department of Commerce regarding questioned costs, provide documentation supporting the allowability of expenses, and request a formal resolution of questioned costs. Person Responsible: Steve Sanders, Grant Manager, Tel: 207-249-8578 Estimated completion: December 2025

Condition: Certain underlying support related to the VOCA Victim Assistance Formula Grant did not agree to amounts charged to the grant. Supporting information and records indicated more funds were spent by the Organization than were charged to the grant. Planned Corrective Action: Management will review its processes, procedures and controls to ensure that reconciliation and review of grant reimbursement requests and supporting underlying documentation occurs in future periods. Planned Completion Date: Ongoing Person Responsible: Kim Reed, VP of Finance