Corrective Action Plans

2025-001 Reporting Federal Assistance Listing Number: 10.553, 10.555, 10.559 Program Title: Child Nutrition Cluster Federal Agency: U.S. Department of Agriculture Passthrough Entity: Arizona Department of Education Passthrough Number: ADE ED09-0001 Compliance Requirement: L. Reporting Award Period: July 1, 2024 – June 30, 2025 Finding Type: Noncompliance, Significant Deficiency in Internal Control Questioned Costs: N/A Repeat Finding: No. Condition/Context: During our review of meals claims submitted for reimbursement, we noted variances between the District’s meal counts and what was submitted to the Arizona Department of Education. For four months tested, meals claims were net under-reported by 48 lunch and breakfast meals, which calculated to $432.84. Criteria: Child Nutrition Cluster claim forms should be supported by documentation showing the number of meals for which reimbursement was requested. This documentation should be maintained to support what was requested for reimbursement by ADE. Effect: Without proper controls over applications and the filing of claims, the District could over or under claim their reimbursements from the Child Nutrition Program without detecting the error. Corrective Action Plan: Management will ensure meals claims are reviewed, approved, and tie to supporting meals served before claims are submitted. Planned completion date for corrective action plan: For the period ending June 30, 2026. Name of the contact person responsible for corrective action: Sherry Wallace, Director of Finance.

Finding 2025-001 Condition Significant Deficiency – Disbursement/Refund of Credit Balances - Title IV regulations (34 CFR 668.164(h)(1) require that Title IV credit balances on student accounts be paid directly to the student as soon as possible but no later than 14 days after the credit balance occurred. A student or parent may authorize the Institution to hold the credit balance to be applied to specified other nontuition fees, room and board charges as noted in the regulations at (34 CFR 668.165(b)). The credit balance generated in the accounts of 2 out of 25 students tested was not timely refunded to them based on the outlined criteria, leading to late refunds to those students (neither of which completed a voluntary hold authorization). The sample was not a statistically valid sample. The College's payment process cycle is not set up to process refunds as soon as possible, which caused delays in refunds being made to students, resulting in a violation of the 14-day maximum policy. Corrective Action Plan Corrective Action Planned: The College acknowledges the untimely disbursement of Title IV credit balance refunds. We concur that, for 2 of the 25 student accounts reviewed, Title IV credit balances were not refunded within the 14-day period required under 34 CFR 668.164(h)(1). We further acknowledge that no valid student or parent authorization to hold these credit balances was on file, and therefore the refunds should have been issued promptly. The College completed an internal review and determined that the delays resulted from the structure of the existing payment processing cycle. Although the College’s processes emphasize careful reconciliation and verification of student account activity, the timing of our refund cycle was not aligned with the regulatory requirement. To remediate this deficiency and ensure full compliance going forward, the College is implementing the following corrective action: Revision of Federal Funds Disbursement Policies: The College is revising its policy governing the drawdown and disbursement of federal funds to align the timing of Title IV activity with the academic add/drop period. This change will ensure greater predictability of credit balance creation and enhance monitoring capabilities. The College is committed to strengthening its internal controls to ensure sustained compliance with all Title IV cash management regulations. Name(s) of Contact Person(s) Responsible for Corrective Action: Pat Tyler, Bursar and Destiny Guerrero, Director of Financial Aid. Anticipated Completion Date: May 2026 – next semester starting date

Finding Number: 2025-001 Responsible Person: Michele Brand, Director Finance/HR/IT Management Views: Management agrees with the finding and immediately implemented the recommendation. Corrective Action: This was a one-time error due to end-of-year accrual adjustments and spending allocation modifications that reduced the amount of spending in certain grants. This is the first time estimates were used, and we deviated from our normal procedures. Estimates will not be used in the future. Anticipated Completion Date: Already complete.

Noncompliance/Material Weakness in Internal Control over Compliance: • Provide grants management training to all its financial staff and management covering the Uniform Guidance/OMB Guidance for Federal Financial Assistance. • Develop and implement policies and procedures that ensure grant funds are drawn at the time of, or following, expenditures for allowable costs. These policies and procedures will include that, for each draw from a Federal award, 1) detailed documentation of the expenditures for which the grant funds are being drawn is prepared prior requesting the draw, including transactional details such as vendor, invoice number, invoice amount, check number, check date, payee, and check amount; 2) that the documentation supporting the draw is reviewed and approved by a member of management (other than the person who prepares the documentation) prior to requesting the draw, and 3) that the documentation supported each draw is maintained as part of the Organization's accounting records. • Return H8F funds, including interest, to the Federal grantor agency.

The District acknowledges the oversight and confirms that the March 2025 claim had been properly prepared and fully supported but was inadvertently not submitted. The District has since contacted NMPED to resolve the matter and submitted the claim. To prevent future occurrences, the District is implementing a new tracking and reminder system and is providing targeted training to staff involved in the claims process. Efforts are also underway to strengthen internal controls to ensure timely submission moving forward.

#2025-002: Audit Adjustments Responsible Individuals: Stacy Haggerty, Clerk/Treasurer Corrective Action Plan: The Clerk/Treasurer has reviewed the recommendations, and such will be implemented as appropriate throughout the year and ahead of the fiscal year 2026 audit. Anticipated Completion Date: Ongoing

#2025-005: Grant Tracking Responsible Individuals: Stacy Haggerty, Clerk/Treasurer Corrective Action Plan: The City will develop a process to agree actual expenditures incurred to the general ledger before requesting reimbursement. Anticipated Completion Date: Fiscal year 2026.

Management acknowledges that certain internal controls did not operate effectively during the year ended June 30, 2025. Management is in the process of implementing additional controls to ensure a stable control environment that supports compliance with cash management and special tests and provisions requirements.

This district has implemented a process where meal counts are reviewed and verified by the Business Office. Each month the business office receives a copy of the meal claim along with all backup with meal counts. The business office reviews the meal counts, verifies the totals and then verifies that the totals match the claim for reimbursement. Any discrepancies found are reported to the Cafeteria Manager for corrections to be made to the claim reimbursement.

Finding 2025-003: Cash Management Assistance Listing Number 84.126A Rehabilitation Services - Vocational Rehabilitation Grants to States Award Period: July 1, 2024 – June 30, 2025 Responsible Person: Karen Miller, Controller, 609-771-2203, Jeanette Vega, Director of Grant Financial Administration, 609-771-2847 Amy Cuhel-Shuckers, Director, Grants and Sponsored Research, 609-771-3120 Corrective Action Plan: For the fiscal year ending June 30, 2025, the College had certain reimbursement requests under ALN 84.126A that were not submitted within the required timeframes and were missing certain documentation elements specified within the underlying grant agreements. While all reimbursement requests were made for allowable expenditures incurred prior to the date of request, the timing and documentation issues resulted from staff turnover and gaps in detailed review procedures within both Finance & Business Services and the Office of Grants and Sponsored Research (OGSR). The College recognizes the importance of ensuring that reimbursement requests are fully compliant with the timing and supporting documentation requirements outlined in 2 CFR 200.305 and the corresponding award documents. During FY25 and FY26, the College strengthened internal controls over reimbursement processing by implementing enhanced month-end monitoring procedures, hiring a Research Business Assistant responsible for additional oversight, improving documentation standards, strengthening cross-functional communication and coordination, and establishing a grant-specific reimbursement deadline tracker. These improvements were incorporated into updated training for principal investigators and grant support staff, with mandatory annual training implemented beginning FY26.The College implemented portions of the corrective actions during the fiscal year, with remaining items implemented at the start of FY26. These actions collectively support full and ongoing compliance with reimbursement requirements for federal and pass-through grant programs. Anticipated Completion Date: June 30, 2026

Capitalization Grants for Clean Water State Revolving Funds SIGNIFICANT DEFICIENCY/NONCOMPLIANCE 2025 - 001 Cash Management Name of contact person: Heather Doughtie, Finance Director Corrective Action: Management will install measures to ensure future grant funds are expended with the required Cash Management time limits. Proposed Completion Date: The Board will implement the above procedure immediately.

Condition: Two (2) monthly claims for reimbursement reported meal counts less than those supported by records of the District. One (1) monthly claim for reimbursement reported meal counts in excess of those supported by records of the District. Corrective Action Plan: Management will review its policies and procedures and implement changes to strengthen internal control over compliance. Responsible Person: Dr. Dwayne E. Evans, Superintendent Anticipated Completion Date: June 30, 2026

2025-002 Reporting Federal Assistance Listing Number: 10.553, 10.555 Program Title: Child Nutrition Cluster Federal Agency: U.S. Department of Agriculture Passthrough Entity: Arizona Department of Education Passthrough Number: ADE ED09-0001 Compliance Requirement: L. Reporting Award Period: July 1, 2024 – June 30, 2025 Finding Type: Noncompliance, Significant Deficiency in Internal Control Questioned Costs: N/A Repeat Finding: No. Condition/Context: During our review of meals claims submitted for reimbursement, we noted variances between the District’s meal counts and what was submitted to the Arizona Department of Education. For four months tested, meals claims were under-reported by 20 lunch meals, which calculated to $90.80. Criteria: Child Nutrition Cluster claim forms should be supported by documentation showing the number of meals for which reimbursement was requested. This documentation should be maintained to support what was requested for reimbursement by ADE. Effect: Without proper controls over applications and the filing of claims, the District could over or under claim their reimbursements from the Child Nutrition Program without detecting the error. Corrective Action Plan: Management will ensure meals claims are reviewed, approved, and tie to supporting meals served before claims are submitted. Planned completion date for corrective action plan: For the period ending June 30, 2026. Name of the contact person responsible for corrective action: Elizabeth Ibarra, Business Manager

The findings from the June 30, 2025 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. A. Current Findings on the Schedule of Findings and Recommendations 1. Finding 2025-001 - Residual receipts deposits not made timely - Significant Deficiency Federal Program Name: Project-Based Rental Assistance - Section 8 Project Based Cluster Assistance Listing Number: 14.195 Federal Award Identfication Number and Year: MA06T831033-25Z, MA06T791016-25Z. Program year - 2025. a. Issue: During the year ended June 30, 2025, management did not make the required residual receipts reserve deposit in the amount of $34,811, within 90 days of June 30, 2024 as required by HUD. The residual receipts amount was deposited in October 2025. b. Recommendation: Management should establish internal controls and procedures to ensure that required residual receipts reserve deposits are made timely. c. Action taken: Management agrees with the finding and has implemented controls to ensure the residual receipts deposits are timely made within 90 days of year end. B. Status of Corrective Actions on Findings Reported in the Schedule of the Status of Prior Audit Findings, Questioned Costs and Recommendations No prior year audit findings identified.

The School District should always reconcile its reimbursement requests with documented workpapers. The School Business Administrator will prepare and retain documentation for each and every reimbursements request, etc. School Business Administrator / Asst. School Business Administrator. 2025-2026 Fiscal year.

The grant employee that was hired in this last fiscal year resigned and there was a period that it was handled by the county manager. The county has since contracted with an outside agency to handle the grants far Catron County.

Audit Finding Number: 2025-001 – Cash Management Agency: Public Housing Capital Fund Responsible Person, Title: Stephanie Schmutzer, Accountant Completion date: 7/1/2025 Agency Response: Concur Corrective Action Plan: Management concurs with the recommendation to implement timely LOCCS fundings that coincides with our normal accounting cycle when receiving Capital Funds in the future.

Corrective Action Plan FYE 6/30/2025 Audit Finding # 2025-0001 – Cash Management The Housing Authority of the City of Prichard acknowledges the audit finding regarding interfund balances and accepts responsibility for implementing corrective actions to strengthen internal controls and ensure long-term financial sustainability. At the onset of the fiscal year, management recognized the need to reduce expenses and thus implemented an expense reduction strategy. In reviewing the overall operating expenses for the agency, comparing FYE 2025 to FYE 2024, overall operating expenses declined by approximately $1M, supporting management's goal to reaching a more sustainable long term financial strategy. To further this initiative and continue improving the cash flow position, management will pursue ongoing expense reductions and financial planning strategies to ensure long-term financial sustainability for the agency. This will be accomplished by implementing the following strategies: 1. Engage site management, maintenance, finance, and executive leadership in comprehensive reviews of approved budgets and financial statements to strengthen fiscal oversight and identify additional cost-reduction opportunities. 2. Executive management will review and approve specific categories of expenses to promote accountability, fiscal responsibility, and effective cost control. 3. Continue with enhancement of the agency's home ownership program, providing increased cash flows for operations and improved financial sustainability. 4. Evaluation measures will continue in which intercompany account balances will be reviewed on a monthly basis, determining which entities can support an intercompany reimbursement to the lending property. Upon determining entities with available cash flows, reimbursements will be processed. 5. Continue the agency's initiatives to increase revenues through transition of properties to other revenue streams that would provide more flexibility in establishing an increased rent structure (i.e. PBVs, market rate rents, etc.) As cash flow conditions improve, management will develop and implement a repayment plan to address intercompany balances, recognizing this as a long-term initiative critical to the Agency’s financial sustainability.

Issue: The reconciled grant balance for all grant accounts is not compared against the total compostion of all grant accounts maintained in the general ledger's individual grant funds. Corrective Action: Staff will compare all grant account reconciliations agains the total composition of all accounts maintained within the general ledger's indvidual grant funds. Confusion occured this year with a review from NFWF of unallowed expenses that were booked as receivables in a previous fiscal year.

Management agrees with the findings and recommendations, this finding has been resolved.

Management agrees with the findings and recommendation is working with ownership on reimbursement to property. Management will gain prior approval for replacement reserve withdraw in accordance with HUD going forward.

Management agrees with the findings and recommendations and has implemented reviews of the financial statements by senior management prior to approving transfers to ensure accuracy of information.

Management agrees with the finding and is working with ownership on reimbursement to the property. Management will collect in accordance with HUD going forward.

Management agrees with the findings and recommendations, however due to insufficient funds at the property, we will collaborate with HUD to secure appropriate funding.

Single Audit – Federal Funds Finding Organization: Pathways In Education – Illinois (PIE-IL) Audit Period: FY25 (or applicable fiscal year) Prepared By: [Brittany Barsevick/Manager of Instructional Compliance] Date: [1/21/2026] Federal Program: ALN 84.010 Title I, Part A, Basic grants Low-Income and Neglected Audit Finding Reference: 2025-001 ________________________________________ 1. Finding Summary The Single Audit identified a deficiency in the documentation and communication of federally funded position percentages and the alignment of Time & Effort attestations with the actual period of work performed. Specifically, the current CPS Federal Funds platform (Oracle) generates Time & Effort Attestation reports based on the month reimbursement claims are submitted, rather than the period during which the work was performed, creating a compliance gap. ________________________________________ 2. Root Cause ● Staff were not consistently informed of the exact percentage of their position funded by federal sources at the start of each semester. ● Time & Effort attestations were generated from the CPS Oracle system based on claim submission timing, not the actual work period. ● There was no formal internal SOP layer to supplement Oracle-generated reports with staff attestation aligned to Semester 1 and Semester 2 work periods. ________________________________________ 3. Corrective Actions Action 1: Internal Funding Percentage Notification System Description: PIE-IL will implement an internal tracking and notification system to ensure all staff funded in whole or in part with federal funds are formally notified of the exact percentage of their position supported by federal funding. Implementation Steps: ● Develop a standardized Federal Funding Allocation Notice template. ● Distribute notices to all applicable staff at the start of Semester 1 and Semester 2. ● Require staff acknowledgment (electronic or signed) confirming receipt and understanding. ● Maintain records centrally in the federal compliance folder. Responsible Party: Manager of Instructional Compliance Timeline: Implemented by the first day of each semester Monitoring: Semester-based review of acknowledgment logs ________________________________________ Action 2: Semester-Based Time & Effort Attestation Description: All federally funded staff will complete and sign a Time & Effort Attestation for both Semester 1 and Semester 2, certifying that time worked aligns with the funding source and percentage assigned. Implementation Steps: ● Issue Time & Effort forms at the end of each semester. ● Require staff to certify actual work performed during the semester. ● Collect supervisor verification signatures. ● Store completed attestations in the federal compliance repository. Responsible Party: Site Administrators / Federal Compliance Officer Timeline: Within 10 business days of semester end Monitoring: Quarterly internal compliance audits ________________________________________ Action 3: Internal SOP as Supplemental Documentation Layer Description: PIE-IL will implement a formal Standard Operating Procedure (SOP) for Time & Effort as a self-managed, internal documentation layer that supplements CPS Oracle-generated attestation reports. This SOP will ensure that Time & Effort documentation reflects the actual period of work performed, rather than the month in which reimbursement claims are submitted. Implementation Steps: ● Draft and approve a written SOP outlining: ○ Semester-based attestation requirements ○ Alignment between funding percentages and staff assignments ○ Reconciliation process between internal records and Oracle reports ● Train administrators and federally funded staff on SOP procedures. ● Maintain SOP as a controlled document with annual review and updates. Responsible Party: Federal Programs Director / Compliance Manager Timeline: SOP finalized within 30 days of audit response submission Monitoring: Annual SOP review and internal compliance testing ________________________________________ 4. Reconciliation Process with CPS Oracle System PIE-IL will perform a monthly reconciliation between: ● Oracle-generated Time & Effort Attestation reports (claim-based), and ● Internal Semester-Based Time & Effort attestations (work-period-based). Any discrepancies will be documented, corrected, and reviewed by the Federal Compliance Officer prior to reimbursement submission. ________________________________________ 5. Evidence of Implementation The following documentation will be maintained for audit and monitoring purposes: ● Federal Funding Allocation Notices with staff acknowledgments ● Signed Semester 1 and Semester 2 Time & Effort Attestation forms ● Approved Time & Effort SOP document ● Training sign-in sheets and materials ● Monthly reconciliation logs between Oracle and internal records ________________________________________ 6. Completion Dates Corrective Action Target Completion Date Funding Percentage Notification System [9/30/2026] Semester-Based Time & Effort Attestation Process [02/06/2026] SOP Finalization and Staff Training [02/28/2026] Monthly Reconciliation Process Ongoing ________________________________________