Corrective Action Plans

FINDING 2023-001 – Significant Deficiency in Internal Control over Compliance – Reporting Description of Finding: Controls should be in place to ensure the accuracy of reporting submitted for federal awards programs with proper supporting documentation to agree to the reports being submitted to the Department of Education. As part of the recordkeeping process, each month’s claim for reimbursement and all data used in the claims review process must be maintained on file. Of the eleven monthly claims reports reviewed during the audit, the supporting documentation for one of the claims (April 2023) could not be located. Statement of Concurrence or Nonconcurrence: The Town agrees with this finding. Corrective Action: The Town agrees with the finding and has implemented internal controls to ensure the supporting documentation for each monthly claim are filed and maintained. Each month the monthly claims reports and supporting documentation will be filed away in a designated secure location with a checklist by month to confirm processing. Name of Contact Person: Cynthia Varricchio, MBA, Director of Finance and School Business Operations. Projected Completion Date: June 30, 2024

Finding Reference Number: 2023-02 Description of Finding: Transportation reports were not submitted timely to the DOT per the grant agreement. Statement of Concurrence or Nonconcurrence: The agency does not concur with this Finding Corrective Action: Quarterly reporting and financial reporting are not joined under the same reporting deadlines. All Quarterly reports were submitted within the required timeframe; that is, 10 days after the quarter ends. There is no deadline for submitting invoices to DOT for reimbursement. In summary, NHCOG is of the opinion that the Finding does not accurately reflect the material detail and reporting of our programs, funding streams and administrative difficulties between the state and our providers. Name of Contact Person: Robert Phillips, Executive Director Projected Completion Date: June 30, 2024

CORRECTIVE ACTION PLAN June 25, 2024 Appalachia Service Project, Inc. respectfully submits the following corrective action plan for the year ended December 31, 2023. Name and address of independent public accounting firm: Brown, Edwards & Company, L.L.P. 636 Shelby Street, Suite 400 Bristol, TN 37620 Audit period: December 31, 2023 The findings from the December 31, 2023, Schedule of Findings and Questioned Costs (the "Schedule") are discussed below. The findings are numbered consistently with the number assigned in the Schedule. FINDINGS AND QUESTIONED COSTS- MAJOR FEDERAL AWARD PROGRAM AUDIT 2023-001: Community Development Block Grant-AL# 14.218, Controls over Reporting Condition: ASP included an amount for reimbursement to the City of Johnson City, TN that had not been paid and was not paid promptly, resulting in ASP receiving funds in advance from the City, which is in violation of the grant agreement ASP has with the City. Criteria: The grant agreerr.e nt with the City states that in no event shall the City provide advance funding to their sub-recipient. Cause: ASP failed to pay an invoice that was submitted for reimbursement prior to the receipt of the reimbursement from the City. ASP's controls over the process of reconciling reimbursement requests and payables from their general ledger to the request were not sufficient to prevent this issue from occurring, resulting in the error. Effect: ASP violated their agreement with the City and received funds in advance. Questioned Costs: NIA Perspective Information: An invoice recorded in their purchasing tracking software was not subsequently recorded in their financial software allowing for request for reimbursement to happen for an invoice that was not promptly paid. Controls were not sufficient to prevent this from occurring. Repeat Finding: No Recommendation: ASP should pay all invoices submitted for reimbursement prior to receipt of the reimbursement from the City in order to stay in compliance with their agreement with the City. ASP should also reconcile between the purchase tracking software and the general ledger to ensure that all purchases are promptly recorded in accounts payable to be paid promptly. ASP should ensure that controls are implemented to help prevent reoccurrence of this issue in the future. Corrective Action: ASP has policies and procedures in place to ensure all reimbursable expenditures are allowable, paid and clear the bank before submitting for reimbursement. However, on one occasion, ASP inadvertently submitted an allowable and paid expenditure of $32.78 that had not cleared the bank. ASP has since repaid this amount and the replacement check has been cashed by the vendor. In the future, ASP will ensure that all expenditures are allowable, paid, and clear the bank before submitting the reimbursement. ASP has re-emphasized the importance of following established procedures when submitting for grant reimbursements and believes proper controls and corrective actions are currently in place to prevent future issues. 2023-002: Community Development Block Grant - AL# 14.218, Reporting Condition: ASP, a sub-recipient, did not submit their Quarter 3 report in a timely manner, which is in violation of the grant agreement ASP has with the pass-through entity, City of Johnson City, TN. Criteria: The grant agreement with the City requires an annual report, a projected expenditures report, and four quarterly reports be submitted by ASP in a timely manner. Cause: ASP failed to submit their Quarter 3 report before it was due. Effect: ASP violated their agreement with the City and submitted their report late. Questioned Costs: NIA Perspective Information: The Quarter 3 report required by the grant agreement between ASP and the City of Johnson City was not submitted timely. Repeat Finding: No Recommendation: ASP should submit all required reports in a timely manner per the grant agreement. Additionally, ASP should review controls and procedures in place to ensure that there are policies to help aid with timely report completion. Corrective Action: ASP is currently engaged in home rehabilitation projects under an agreement with Johnson City CDBG. This agreement stipulates that quarterly reports must be submitted by the 15th of the month following the quarter. Despite completing the required work and accurately tracking expenses, the report due on I 0/16/2023 was submitted a little over 2 weeks late on I 1/2/2023 due to an omission by staff. However, ASP has maintained communication with the grant administrator at Johnson City and has remained compliant with all other aspects of the contract. The delayed submission of the quarterly report has not impacted ASP's favorable standing with the city, and we have promptly rectified the situation, ensuring full compliance with the agreement. ASP believes the proper corrective action has taken place to ensure future reports are submitted in a timely manner. If the Federal Audit Clearinghouse has questions regarding this plan, please call Greg DeGennaro, CFO at 423- 854-8800. Sincerely yours, Greg DeGennaro Chief Financial Officer

Grantee Response: The Association took immediate action to notify the grant administrators when the condition was discovered, performed an investigation, and submitted a report to the grant administrators detailing their findings. As a result of these circumstances, the Association has made several updates to their policies including 1) regularly reviewing cell phone records to detect out of state calls within one month of their occurrence; 2) developing an approval form for out of state travel that must include proof of the grant administrators approval and a detailed agenda of the trip; 3) requiring that expense reimbursement forms include travel dates and times as well as the event that the travel is related to; 4) crosschecking the shared office Outlook calendar each payroll period to personal leave requested in the payroll system; and 5) attending monthly grant administrator meetings to facilitate communication and ensure that the Association is made aware of travel requests.

The Department of Behavioral Health (DBH) concurs with the finding. The Accounting Supervisor will require additional documentation upon the presentation of a draw request for all federal grants prior to submitting the request in the federal system. The accountant will be required to submit a report reflecting summary and detailed reports for all draw requests. This report will include detailed payroll information as well as confirmation that all non-personal services expenditures have been disbursed. Contact - Adran Reid, DBH Agency Fiscal Officer Estimated Completion Date - July 1, 2024 See Corrective Action Plan for chart/table

Cash Management: As is the case with most higher education institutions and governmental entities, the College has struggled with the COVID pandemic and its aftermath. Essential functions were disrupted, including several key accounting, finance, functions due to employees being out sick. Chief Dull Knife College had a discrepancy occur when drawing down funds in which it was done in error twice and an aggregate difference from the previous year was carried over. This was discovered and the difference was sent back to HEERF. The HEERF funding has been reconciled and concluded. The College had more than sufficient money in the bank to cover all of their expenses so this money was not used to cover any expenses. Chief Dull Knife College takes the responsibility of drawing money from Grant Programs very crucial and will make all efforts and policies to ensure this type of error does not occur.

Even though prevailing wage was paid, contract was bid and awarded as such, in the future, the Treasurer will ensure that prevailing wage rate requirements of necessary clauses are included within all applicable contracts.

Unallowable Costs Criteria: The Organization must submit only allowable costs for reimbursement under the accounting principles contained in Uniform Guidance. Condition: During compliance testing, it was noted that one out of twenty five selections improperly included alcohol in the balances submitted for expense reimbursements. Context: One expense reimbursement was found to have reimbursed alcohol. Cause: There was a lack of consistent review of the receipt before submission for expense reimbursement. Effect: As a result of the condition, one reimbursement was overpaid. Recommendation: In the future, the Organization should review reimbursements closely to ensure unallowable costs are not submitted for reimbursement. Contact: Erin Spaulding, Senior Director of Finance. Corrective Actions Taken or Planned: Management acknowledges the finding and will take action to ensure that no unallowable costs are being reimbursed.

2023-001 Utility Allowances Calculations Corrective Action Plan: If the family selects a unit with a different number of bedrooms than the family unit size listed on the voucher, the PHA must apply the payment standard and utility allowance for the smaller of the family unit size listed on the family's voucher or the unit size selected by the family. 24 CFR 982.S0S(c)(l) Anticipated Completion Date: Management will implement training and procedures to ensure compliance with federal guidelines that relate to the Housing Choice Voucher Program. Training and procedure reviews are currently in progress and will be ongoing.

Timestudy Testing Medical Assistance Program – Assistance Listing No. 93.778 Recommendation: We recommend that the County enact controls to assure employees included in grant are included in reporting submitted. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The County will implement procedures to ensure that all reports are reviewed prior to submission. Names of the contact person responsible for corrective action: Pat Paquin, Finance Manager Planned completion date for corrective action plan: December 31, 2024

Federal Aid Policies Finding 2023-002 Auditor Description of Condition and Effect: The Authority’s management has completely turned over and been restructured. However, the Authority’s policies for federal aid approved in 2021 have not been revised to update for the current management structure. The policies have also not been updated for changes in the 2 CFR 200 that have occurred. As a result, the Authority is noncompliant with 2 CFR 200. Auditor Recommendation: We direct the Authority review and update all federal aid policies and implement procedures to ensure that they are being reviewed at least once a year for changes in the Authority’s management structure or changes that occur in the 2 CFR 200. Corrective Action Plan: The Authority will update their federal policies to comply with 2 CFR 200 and will review all policies on an annual basis going forward. Responsible Official: Contact person is Rufus Adams, Executive Director,275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. Due Date: September 30, 2024

El Proyecto will continue to implement the following measures to ensure compliance with the sliding fee discount program, and consistently assess patient income and family size. El Proyecto will continue to provide ongoing training to clinic staff who evaluate the sliding fee application at its clinic locations. The training will consist of reviewing sliding fee program policies and procedures along with all applicable patient forms, sliding fee scale, and patient eligibility. Person Responsible: Leticia Vasquez Position of Responsible Party: Billing Manager Completion Date: September 30, 2024

Finding 2023-006: Crime Victim Assistance Documented Review and Approval Procedures U.S. Department of Justice Pass-through Entity: Michigan Department of Health and Human Services Assistance Listing Number: 16.575 Award Numbers: E20232575-00, E20233017-00, E20233431-00 Award Year End: September 30, 2023 Recommendation: The Organization should establish procedures to require the documented review and approval of all indirect cost calculations, cash management requests for funds, and reports by an individual with adequate skills, knowledge, and experience prior to submission. Action Taken: The Organization will establish the necessary policies and procedures to require the documented review and approval of all indirect calculations, cash management requests for funds and performance reports on a monthly basis prior to submission with documented approval. Responsible Person and Anticipated Completion Date: The Executive Director will oversee the implementation of this plan by September 30, 2024.

2023-006 – ALN 14.872 – Public Housing Capital Fund Program – Cash Management Planned Corrective Action: The Interim Executive Director acknowledges the finding and is following the auditor’s recommendation as presented in the Audit Report. Person Responsible for Correction of Finding: Christy Amacher, Interim Executive Director Anticipated Completion Date: September 30, 2024

Findings Related to the Financial Statements Reported in Accordance with Government Auditing Standards None Findings Related to Federal Awards 2023-001 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Federal Agency: U.S. Department of Homeland Security: Passed through the State of New Jersey, Department of Law and Public Safety Program Titles and Assistance Listing Numbers (ALN): Disaster Grants – Public Assistance (Presidentially Declared Disasters) – ALN 97.036 Federal Grant Numbers: State of New Jersey pass-through number: UH1WX, Project Worksheet #1822 – Award Year 2023 (Application 553330) Contact Person: Donna Wilser, Deputy Executive Director, 732-750-5300 Corrective Action: Management agrees with the finding. We are committed to strengthening our processes to ensure that all physical timesheets related to FEMA-declared disaster events are properly maintained and readily accessible. To achieve this, we will implement enhanced procedures and controls to ensure full compliance with the Uniform Guidance requirements. Anticipated Completion Date: December 1st, 2024

Finding 2023-014 Medicaid Cluster, ALN 93.775, 93.777, and 93.778 and Children's Health Insurance Program, ALN 93.767 - Expenditure Processing for Medical Payments Management Views MDHHS agrees with the finding. Planned Corrective Action MDHHS has been working since 2018 to ensure correct eligibility classifications in Bridges at the time of payment and a system change was implemented in April 2021 to correct the issue. All new cases are correctly routed. MDHHS originally expected to have all cases corrected at the end of the PHE unwind (July 2024), however, due to some of the mitigation strategies that CMS developed to ensure children did not lose eligibility, not all cases had their coding updated when they were renewed. MDHHS expects that all existing cases will be updated by May 2025, as MDHHS completes renewals for existing cases. MDHHS identified and updated its manual process of transferring expenditures from the Medicaid Cluster to the Children’s Health Insurance Program (CHIP) in June 2021; and will continue this manual process, on a quarterly basis, by completing a summary-level adjustment determined by analyzing the Community Health Automated Medicaid Processing System (CHAMPS) payment data and Bridges eligibility data until all existing cases have been updated. Anticipated Completion Date May 2025 Responsible Individual(s) Brant Cole, MDHHS Logan Dreasky, MDHHS Erin Emerson, MDHHS

Finding 2023-053 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Timeliness of Cash Draws Management Views LEO agrees with the finding. Planned Corrective Action LEO has filled a staff vacancy which previously contributed to late draws. Also, LEO will implement additional staff training and management oversight to ensure reimbursement requests are made timely and in accordance with CMIA. Anticipated Completion Date September 30, 2024 Responsible Individual(s) Lora MacKay, LEO

Finding 2023-009 Treasury - Recertification of Clearance Patterns Management Views Treasury agrees with the finding. When the Cash Management Improvement Act (CMIA) program transferred to Treasury FSD in early 2022, there was a lack of well-documented procedures on how to complete program clearance pattern reviews. FSD created a procedure for the review process, but it is not complete. Planned Corrective Action Treasury FSD will continue to gain a better understanding of the clearance pattern review process and thoroughly document the procedures for future fiscal years to ensure compliance with federal regulations. FSD will research how the clearance patterns are determined for each program, identify which programs require clearance pattern review each year, ensure that the SIGMA BI queries are functioning properly for each program under review, and clarify how to interpret the BI query results. Anticipated Completion Date September 2024 Responsible Individual(s) Melanie Alvord, Treasury Lauren Markwart, Treasury

Finding 2023-026 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027 - Grant Reimbursement Approval Procedures Management Views EGLE agrees with the finding. Planned Corrective Action EGLE’s Water Resources Division’s Administration staff reviewed the existing process with staff conducting the administrative review to ensure the technical review will be completed in advance of making any payment. If Administration staff have received a request for payment without the technical review, Administration staff will forward all documents received to the project manager to obtain the technical review. Once the technical review has been completed, Administration staff will conduct the administrative review and process the payment request. Additionally, EGLE subsequently reviewed the reimbursement request noted in the finding to ensure that the cumulative totals requested have been for projects that are consistent with the grant award. Anticipated Completion Date Completed Responsible Individual(s) Phil Argiroff, EGLE Amy Hicks, EGLE

Finding 2023-006 MDE, Security Management and Access Controls Management Views The Michigan Department of Education (MDE) agrees with the finding. Planned Corrective Action For part a., as part of the Michigan Nutrition Data (MiND) 2.0 Implementation Project, MDE will institute a mechanism to capture the person to whom the access has been delegated. MDE will review the policies and procedures with department staff that is responsible for security access controls for the Next Generation Grant, Application and Cash Management System (NexSys) to ensure proper access control policies are followed. For part b., MDE will update policies and procedures to ensure review of all accounts on a semi-annual basis. For parts c. and d., MDE will continue to work with DTMB to find more efficient ways to ensure all non-privileged users are recertified and improve the technical solution to deactivate users after 18 months of inactivity. For part e., as part of the movement of the grants management unit at MDE to a different office, MDE is reviewing the policies around high-risk transactions and will update the policies to meet established standards. Anticipated Completion Date October 1, 2024 Responsible Individual(s) David Judd, MDE

Finding 2023-021 SNAP Cluster, ALN 10.551 and 10.561 - EBT Reconciliations Management Views MDHHS disagrees that a material weakness and material noncompliance exist. MDHHS federal reporting conducts a daily reconciliation of federal draws and authorizations to retailers based on vendor EBT reports. In addition, MDHHS conducts a monthly reconciliation between Bridges, Bridges data warehouse, and vendor EBT reports using daily data to ensure the client information in Bridges and Bridges data warehouse is accurate. The monthly reconciliation process does not impact the federal draw because the daily reconciliation of the vendor EBT report is used for this purpose. MDHHS provided detailed and accurate descriptions of MDHHS daily and monthly EBT reconciliations to the designated federal awarding agency contacts at the United States Department of Agriculture Food and Nutrition Service Agency that are familiar with MDHHS processes and received confirmation that the current reconciliation processes in place are sufficient to comply with federal regulations. Planned Corrective Action MDHHS disagrees with the finding and does not intend to take further action. Anticipated Completion Date Not applicable Responsible Individual(s) Sara Gross, MDHHS

Based on prior year (FY22) findings, the City established the following procedures to ensure payment requests received from subrecipients are paid within 30 days of receipt of a complete request for reimbursement: 1. Department of Human Service Programs (DHSP) Contract Manager reviews invoices within 5 business days of receipt of request for reimbursement from subrecipient. a. If invoice is complete, original date of receipt is recorded. b. If invoice is incomplete, subrecipient is notified of items or documentation that is missing and receipt date is updated to reflect date of receipt of complete invoice. 2. Contract Manager approves payment request and submits to DHSP Fiscal staff for processing. 3. Fiscal staff processes and submits to Auditing Department as Priority payment. Four of the 19 sampled payment requests were received or processed after receipt of the FY22 audit findings, and all of those requests for reimbursement were paid within 30 days of receipt.

2023-003 Finding - Federal Award - Significant Deficiency - Reporting US Department ofCommerceAL#11.611 Context and Cause - The Organization was not made aware by grants, CMTC or prior auditors that the final upload package of the federal reports and requests for reimbursement should have internal control oversight procedures and did not exercise such oversight. Only one individual was responsible for preparing and filing these final documents after such details were reviewed individually throughout the month by other individuals responsible for that review. The payroll time sheet review process was consistently followed, however, and there is not a process for the final processed payroll rep01ts to be reviewed by a second individual.Recommendation: We recommend management implement procedures to ensure the Uniform Grant Guidance and the Compliance Supplement requirements for controls over Reporting, Allowable Costs, and Cash Management are designed and performed. The month­ end checklist currently being used is a good start, and this could be enhanced by adding sections for the above items, and having specific individuals' initial and date on the checklist when the procedures are completed. A fiscal policy and procedure manual would also be a good tool. Action Taken: Manex will update fiscal Policy to include oversight on reporting to funders

In Finding 2023-005, a condition was noted that during the year, the Organization made a draw of federal funds that were not disbursed in a timely manner for program expenditures. Management recognizes the importance of the requirements to disburse federal funds in a timely manner. In response to Finding 2023-005, procedures will be established to minimize the time elapsing between the transfer of funds to the Organization from the U.S. Treasury and the issuance of payments for program purposes by the Organization.

Finding 2023-002 Condition The Organization did not have timely approval of non-payroll expenditures to support preparation of reliable financial reports to grantors. Corrective Action Plan Corrective Action Planned: Improvements have already been made to this process in the current year regarding the timely submission of supporting documentation and authorization and this will continue to be an area of focus in both operations and finance. Name(s) of Contact Person(s) Responsible for Corrective Action: The Director of Accounting, Dawn Bonderczuk, and the Account Payable Clerk or Accountant. Anticipated Completion Date: July 31, 2024.