Corrective Action Plans

2024-011 Timely Grant Draws Material Weakness Recommendation: The Housing Authority should adopt written grant draw policies into its financial policies and procedures manual. Financials should be reviewed monthly, and drawdowns made as needed. Action Taken: The Housing Authority agrees with this finding and will implement this recommendation within 120 days of this audit report.

2024-005 Timely Bank Reconciliations Material Weakness Recommendation: Implement currently adopted policies over bank reconciliations. Action Taken: The Housing Authority agrees with this finding and will implement this recommendation within 120 days of this audit report.

2024-004 Cash Management Material Weakness Recommendation: Auditors recommend filing documentation for grant draws along with payment vouchers throughout the year. Action Taken: Documentation for grant draws and expenditures to support the request for funding is vouchered along with wire transaction documentation that requires the signature of 3 Tribal Council for processing.

3. Deficiency #3 – Federal Grant Reporting a. Type of deficiency: Material Weakness – During our testing of the Port’s BUILD20 reporting requirements, we noted the SF-270 report dates were not accurate as a result of the associated expenditures being adjusted. We recommend the Port refiles affected SF-270 to match the reported expenditures for the fiscal year. b. The checklist noted in Deficiency #2 is also being used to make sure the SF-270s are correct. We are working with the Federal Highway Administration to see about refiling SF-270s. c. Already implemented.

Finding Number 2024-019 Subject Heading (Financial) or AL no. and program name (Federal) AL #84.425 – EDUCATION STABILIZATION FUND (ESF - AL #84.425U) Planned Corrective Action OSDE maintains that these procedures are adequate to ensure compliance with 34 CFR §§ 75.600–75.618. Leadership in the Office of Title Services determined that OTS did not have the staff capacity to require review of payroll certifications during the application review process; therefore, this monitoring was conducted during onsite visits. Given the limited number of project managers available to perform onsite reviews during the ESSER period, OSDE believes the sampling completed onsite was reasonable and sufficient to assess compliance. Guidance and tools were provided to LEAs to support proper implementation of prevailing wage requirements. Monitoring results are reviewed and approved by OTS leadership, and corrective actions are required when non-compliance is identified. Anticipated Completion Date Sept-25 Responsible Contact Person Tammy Smith

Finding Number 2024-044 Subject Heading (Financial) or AL no. and program name (Federal) ALN: 21.027 Federal Program name: Coronavirus State And Local Fiscal Recovery Funds (CSLFRF) Planned Corrective Action Office of Management and Enterprise Services – Grants Management Office Response: OMES-GMO respectfully disagrees with the conclusion that the variances identified in this finding represent deficiencies in internal controls over Project and Expenditure (P&E) reporting. While OMES-GMO agrees that accurate reporting is essential and remains committed to continually strengthening its reporting processes, the variances identified are primarily attributable to timing differences inherent in the State's accounting, reimbursement, and grant administration processes rather than errors in reporting or deficiencies in internal controls. Quarterly Project and Expenditure Reports submitted to the U.S. Department of the Treasury are prepared using the best information available at the time each report is due. Because agencies operate under established State accounting and reimbursement processes, expenditures are not always fully processed, approved, posted in PeopleSoft, or reimbursed by the close of each Treasury reporting quarter. Consequently, legitimate timing differences may exist between quarterly Treasury reports and subsequent reconciliations to the Statewide Accounting System. Treasury's Project and Expenditure reporting process allows recipients to update previously reported information through subsequent quarterly submissions. As expenditures are processed, accounting adjustments are completed, and additional information becomes available, corrections may be made in future reporting periods. OMES-GMO recognizes the importance of reconciling these timing differences; however, complete alignment between quarterly Treasury reporting and the Statewide Accounting System cannot always be achieved until the close of the CSLFRF period of performance, when all expenditures, reimbursement requests, accounting adjustments, and project closeout activities have been completed. For this reason, OMESGMO does not believe these timing-related variances, standing alone, constitute deficiencies in internal controls. The agencies identified in this finding provided additional information demonstrating that the reported variances were the result of normal business processes, reimbursement timing, accounting adjustments, or Treasury reporting requirements rather than inaccurate reporting or unsupported expenditures. Agency 055 confirmed that the expenditures identified by the auditors were identifiable and supported. Agency 085 explained that the reported variance resulted from a temporary operational period during which expenditures for multiple federal grant programs were processed through Class Fund 497 because other federal funding accounts were unavailable during a novation period. Those expenditures were never intended to be reported as CSLFRF costs and have since been, or are being, transferred to the appropriate federal funding sources through Journal Vouchers and reimbursement processes. Agency 090 explained that the consolidation of expenditures with Agency 423 created timing differences between reporting quarters. Agency 452 stated that the variance resulted primarily from the timing of Treasury reporting deadlines compared to the posting of expenditures in PeopleSoft, resulting in temporary differences that were subsequently reconciled. Agency 605 explained that excess advance funding was returned following contract amendments based on projected spending needs, while actual expenditures continued into subsequent reporting periods, creating temporary timing differences. Agency 619 demonstrated that the questioned expenditures were reported in the quarter in which reimbursement requests were received, processed, and submitted to OMES-GMO. In addition, one cash advance originally included in a quarterly report was removed at OMES-GMO's direction to comply with Treasury reporting guidance. Agency 800 explained that the reported variance resulted from the timing of State accounting transactions, where federal revenue was deposited at the end of the fiscal year while the related expenditures could not be posted until the subsequent fiscal year due to State accounting system limitations. The agency believes this represents a normal timing difference between reporting methodologies rather than a reporting deficiency. Although OMES-GMO disagrees that these timing-related variances constitute deficiencies in internal controls, OMES- GMO remains committed to strengthening reporting procedures. Beginning with FY2025 reporting, OMES-GMO has implemented enhanced reconciliation procedures requiring agencies to reconcile reported expenditures to Summary of Receipts and Disbursements (SRD) reports and PeopleSoft data prior to submission. OMES-GMO has also expanded agency guidance and annual training regarding Treasury reporting requirements, reconciliation procedures, and documentation expectations. These enhancements improve reporting consistency while recognizing that timing differences may continue to occur throughout the period of performance and will be resolved through subsequent Treasury reporting updates and final grant closeout. Anticipated Completion Date April 30, 2027, due to variances in normal business processes, reimbursement timing, accounting adjustments, and Treasury reporting requirements. Responsible Contact Person Elizabeth Base

Audit Finding Reference: 2024-002 Document Policies and Procedures Over Federal Awards Planned Corrective Action: A Uniform Guidance policy and Procedure document has been adopted. Planned Implementation Date of Corrective Action: The policy was effective 03/21/2025. Person Responsible for Corrective Action: Finance Director

Planned Corrective Action: While the Organization’s existing internal controls address management of invoices and payments, there was no written process within the organization’s internal controls that identified the required documentation, workpapers, review, and approval for federal grant reimbursements. Planned Implementation Date of Corrective Action: October 1, 2025 Name of Contact Person: Melinda Lequin, Executive Finance Director

Reporting Requirements for Federally Funded Projects – U.S. Department of Agriculture Community Facilities Loans and Grants, (Assistance Listing #10.766) Name of the Contact Person Responsible for the Corrective Action Plan: Willis Lott, Director of Finance. Corrective Action Plan: We concur. We will continue to review and improve policies and procedures in an effort to eliminate error and identify deficiencies from both operational and financial perspectives. Anticipated Completion Date: August 31, 2025

Management will: Establish grant drawdown submission deadlines, Implement automated compliance calendar reminders and list of important dates for grant period, and Annual Uniform Guidance compliance training.

Management will improve internal processes and controls to include the following: Monthly review of program expenditures for overall grant period, Quarterly reconciliation of voided checks against program drawdown invoices, and Annual Uniform Guidance compliance training.

Finding Number 2024-010 Corrective Action Plan Cash Management — AL 15.875 (U.S. Department of the Interior) • Develop, approve and issue a dedicated written cash management procedure specifically addressing the time elapsing between the receipt of infrastructure project funds and their disbursement, setting out the disbursement process and target timeframes consistent with Article IV, Section 5(b)(ii) of the Fiscal Procedures Agreement. • Maintain documentation of the date of receipt and the date of disbursement for each drawdown, so that compliance with the procedure and the minimization of elapsed time can be evidenced and monitored. • Institute periodic monitoring and reporting of elapsed time between receipt and disbursement, with exceptions escalated for management action. • Train Treasury staff and the authorized signatories in the wire-out approval process on the new procedure and the applicable FPA requirement. • Pursue resolution of the questioned costs of $1,643,137 through the audit resolution process with DOI/OIA. Management’s position is that the condition is an internal control deficiency and that questioned costs of $0 are warranted under the definition in 2 CFR § 200.1, including paragraph (3)(i), as the FPA prescribes no day-count standard, all disbursements were made within the month of receipt through the required approval process, and the payments were eligible, fully supported and reasonable. Anticipated Completion Date 9/30/2027 Responsible Person (Contact Details) Ms. Julyn Lawrence Email: julyn.lawrence@gov.fm Ms. Senny Phillip Assistant Secretary, Investment Email: senny.phillip@gov.fm

Type of Finding: Material Weakness in Internal Controls over Compliance- Cash Management Recommendation: We recommend that management ensure that all invoices are reviewed and approved before submission. Explanation of Disagreement with Audit Finding: There is no disagreement with the audit finding. Action taken in response to finding: Management has implemented a policy which requires each drawdown to be reviewed and to be based only on expenses incurred for the period, prohibiting the use of a straight-line calculation to draw down funds. Invoices are also approved by the CFO or CEO prior to submission. Name of the contact person responsible for corrective action: Regan Kelly, CEO of Net Treatment Services, Inc. dba: NET Community Care (215) 451-7000 Planned completion date for corrective action plan: December 31, 2026.

Type of Finding: Material Weakness in Internal Control over Compliance- Cash Management Recommendation: We recommend that management ensure that all drawdowns are reviewed and approved before submission. Explanation of Disagreement with Audit Finding: There is no disagreement with the audit finding. Action taken in response to finding: Management has implemented a policy which requires each drawdown to be reviewed and to be based only expenses incurred for the period, prohibiting the use of a straight-line calculation to draw down funds. Invoices are also approved by the CFO or CEO prior to submission. Name of the contact person responsible for corrective action: Regan Kelly, CEO of NorthEast Treatment Centers, Inc. at (215) 451-7000 Planned completion date for corrective action plan: December 31, 2026

Franklin County Department of Job and Family Services will revise all subaward and contract boilerplates issued post July 1, 2026, to reflect that any deviations from the stated invoice submission schedule must be authorized in writing by FCDJFS. Additionally, internal process and training documents will be revised to align with this process. FCDJFS staff responsible for federal subawards and contracts will be trained on the new process by or before July 1, 2026.

Views of Responsible Officials: Management acknowledges this finding, which is a repeat of finding 2023-004. While management believes that appropriate review and approval of drawdown requests occurred during the fiscal year, we recognize that the lack of documented evidence constitutes a control weakness. ICFJ will implement a formal drawdown request procedure requiring that each request be accompanied by a supporting calculation schedule and documented evidence of independent review and approval, evidenced by signature and date, prior to submission to the funder. All drawdown documentation will be filed centrally and maintained for audit retrieval.  Anticipated completion date: 9/30/26  Responsible position: Chief Financial Officer

Finding 2024-005 – Duplicate Reimbursement Request for Federal Award Expenditures (Material Weakness) Criteria: CFR §200.403 and related provisions, costs charged to federal awards must be accurate, allowable, and not charged or reimbursed more than once. Additionally, reimbursement requests must be supported by complete and accurate records to ensure compliance with federal requirements and prevent improper payments. Condition: During our testing of expenditures and reimbursement requests for the above-referenced federal program, we identified that certain expenditures were submitted for reimbursement twice across twoseparate fiscal years. While the underlying expenditures were incurred only once, and not paid twice by the entity, they were included in reimbursement requests in two different periods, resulting in The Town receiving duplicate reimbursements for the same costs Cause: The duplication likely occurred due to changes in financial staffing for The Town. Specifically: • Turnover in personnel resulted in a loss of institutional knowledge regarding prior reimbursement and submissions. • Inadequate review controls allowed previously reimbursed expenditures to be re-submitted in a subsequent period. • Initial reimbursement requests appear to have used an alternate methodology for reimbursement requests. Context: The Town administers multiple federal awards and is responsible for preparing and submitting reimbursement requests based on incurred allowable expenditures. During the audit period, The Town experienced staff turnover and changes in key financial and grant management roles. These changes affected the continuity of oversight and the tracking of cumulative expenditures and prior reimbursement requests. As a result, controls over the review and reconciliation of reimbursement submissions were not consistently applied, contributing to the resubmission of previously reimbursed expenditures in a subsequent year. Recommendation: We recommend that the entity: • Reconcile all reimbursement requests to the underlying expenditures and prior submissions to identify and quantify any additional duplication. • Re-pay any overpayments to the federal awarding agency in a timely manner. • Strengthen internal controls by: o Implementing a centralized tracking system for all reimbursement requests and cumulative expenditures. o Establishing a formal review and approval process to verify that costs have not been previously reimbursed. o Clearly document roles and responsibilities, especially during staffing transitions. • Provide training to staff involved in grant management to ensure compliance with federal requirements. Corrective Action Plan: The Town of Lakeview has taken significant organizational and procedural steps to strengthen its administration of federal awards and ensure future compliance with Uniform Guidance reporting requirements. Corrective actions implemented include: • The Town has hired a Finance Director with substantial experience in state and federal grant administration and financial reporting. The Finance Director is responsible for oversight of all federal financial reporting, including review of expenditures and preparation of disbursement requests. • The Town has hired a new Town Manager who has established improved financial oversight and accountability throughout the organization. The Town Manager will work closely with the Finance Director to monitor compliance with federal grant requirements and review expenditures and disbursement requests. • The Town Council has established a Citizen Finance Advisory Committee to provide independent oversight and review of the Town’s financial management practices. The committee will review financial reports, budget performance, and federal grant administration processes, providing recommendations to improve accountability and transparency. • The Town has developed and implemented formal policies and procedures governing the administration of federal awards including: o Identification and tracking of awards o Documentation of expenditures charged to federal programso Procedures for maintaining grant files o Reconciliation of grant expenditures to the general ledger o Annual preparation and supervisory review of the Schedule of Expenditures of Federal Awards • The Finance Director will prepare disbursement requests, and they will be reviewed and signed by Council members prior to submittal. A ll disbursement requests and associated expenditures will be maintained in an electronic file system. Hard copies of disbursement requests and expenditure documentation will also be maintained in a standardized fi le system. Planned Implementation Date: The corrective actions described above have been implemented. The Town will continue to monitor compliance throughout the fiscal year, and the revised procedures will be fully incorporated into the preparation of the next annual SEFA. Responsible Person: Town of Lakeview Mayor.

FINDING 2024-008 Finding Subject: Special Education Cluster (IDEA) Contact Person Responsible for Corrective Action: Superintendent and Treasurer Contact Phone Number and Email Address: Kyle Neukam; 812-752-8921; kneukam@scsd2.k12.in.us Casey Cheatham; 812-752-8949; ccheatham@scsd2.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The School Corporation partnered with Mazi Education for oversight. Separate funds are maintained for each project year. Payroll mapping has been corrected and reimbursement requests are based on ledger activity with supporting documentation. Transfers are documented and restricted. Monitoring procedures ensure ongoing compliance. The School Corporation has implemented procedures designed to strengthen the control environment, improve risk assessment and information and communication processes, enhance control activities, and provide ongoing monitoring to ensure compliance with Special Education grant requirements and timely identification and correction of deficiencies. Anticipated Completion Date: August 2026

CORRECTIVE ACTION PLAN (Concerning Finding 2024-001) Contact Person Responsible for Corrective Action: Dana L. Gendreau, Interim County Administrator Corrective Action: The County of Aroostook acknowledges the procurement deficiency identified in Finding 2024-001. The County previously developed and formally adopted a Federal Grant Procurement Policy on February 18, 2026, establishing procedures compliant with 2 CFR 200.317–327 and Appendix II, including required procurement methods, documentation standards, and inclusion of applicable federal contract provisions. The finding is reported as a repeat finding of prior years; however, the policy establishing these controls was adopted subsequent to the period in which the procurement activity under review occurred or during early implementation of the policy. As a result, the condition identified reflects a lapse in the consistent application of newly established procedures rather than a deficiency in policy design. To address this, the County has strengthened internal controls by requiring completion of standardized procurement checklists for all federally funded purchases and implementing enhanced supervisory review of procurement files to ensure that contracts and required federal provisions are included prior to execution and reimbursement. Additional guidance has been provided to staff to reinforce compliance expectations and ensure consistent application of procurement procedures. The County will continue to monitor procurement activities to ensure full implementation of established controls and anticipates that this finding will be resolved upon demonstration of consistent compliance in the subsequent audit period. Anticipated Completion Date: February 18, 2026 (Implemented)

CORRECTIVE ACTION PLAN (Concerning Finding 2024-001) Contact Person Responsible for Corrective Action: Dana L. Gendreau, Interim County Administrator Corrective Action: The County of Aroostook acknowledges the procurement deficiency identified in Finding 2024-001. The County previously developed and formally adopted a Federal Grant Procurement Policy on February 18, 2026, establishing procedures compliant with 2 CFR 200.317–327 and Appendix II, including required procurement methods, documentation standards, and inclusion of applicable federal contract provisions. The finding is reported as a repeat finding of prior years; however, the policy establishing these controls was adopted subsequent to the period in which the procurement activity under review occurred or during early implementation of the policy. As a result, the condition identified reflects a lapse in the consistent application of newly established procedures rather than a deficiency in policy design. To address this, the County has strengthened internal controls by requiring completion of standardized procurement checklists for all federally funded purchases and implementing enhanced supervisory review of procurement files to ensure that contracts and required federal provisions are included prior to execution and reimbursement. Additional guidance has been provided to staff to reinforce compliance expectations and ensure consistent application of procurement procedures. The County will continue to monitor procurement activities to ensure full implementation of established controls and anticipates that this finding will be resolved upon demonstration of consistent compliance in the subsequent audit period. Anticipated Completion Date: February 18, 2026 (Implemented)

We agree with the recommendations offered and will establish updated policies, including a DWX Advance Funds Policy, and procedures, to address the finding while considering appropriate measures for operating programs that our government partners require to be on a cost reimbursement basis. We have addressed this finding to our government partners. The majority of our government partners fund in monthly or quarterly increments. Periodically we update our government partners on program funds that have been used or those funds that are excess. The anticipated completion date is October 2026.

Finance policy and procedure manual was updated with recommendations. See attached.

Views of Responsible Officials: IJD acknowledges that at the Statement of Financial Position date it was holding Federal funds in excess of immediate operational need. This situation was rectified shortly after, in February 2025, when the funds were used to finance IJD’s risk pool to protect investigative journalists. This use of funds was exactly in line with the proposal originally submitted to the Federal funder (USAID), and with the risk pool in place and fully financed IJD is able to continue recruiting new members and credibly offer them the protection envisioned in the original grant proposal. Name and Title of Responsible Official: Oliver Rivers, Chief Operating Officer Anticipated Completion Date: Not applicable

Root Cause Analysis: The root cause of this finding was a misapplication of the approved indirect cost rate to the appropriate Modified Total Direct Cost (MTDC) base in connection with drawdown calculations. Although The EPI Center had an approved indirect cost rate and related policy in place, the operational procedures and system configurations necessary to consistently apply the methodology were still being refined and operationalized. The EPI Center notes that a formal, written Indirect Cost Rate Policy consistent with Uniform Guidance (2 CFR Part 200) was in place at the time of award. However, during the initial year of administering a federal award as fiscal agent, the procedures outlined in the policy were not fully operationalized. This resulted in a misapplication of the approved indirect cost rate. The overdraw resulted from applying the indirect cost rate to budgeted, rather than actual, direct expenditures. Management has since recalculated allowable indirect costs based on actual expenditures and has implemented enhanced controls to ensure accurate application of the MTDC base and compliance with federal requirements going forward. Response, with details: ☒Corrective Action Plan ☐Clarification Management acknowledges the misapplication of the approved indirect cost rate and has taken immediate steps to correct the calculation and ensure full alignment with federal requirements. Specifically, The EPI Center has recalculated indirect costs based on allowable expenditures within the Modified Total Direct Cost (MTDC) base and is actively engaging with the U.S. Department of Education to determine the appropriate resolution of the overdrawn amount. Management confirms that all underlying expenditures charged to the program were allowable, allocable, and supported by appropriate documentation, and no unallowable costs were identified. Corrective Actions Management has implemented the following corrective actions to address the issue and strengthen internal controls: 1. Training and Capacity Building (Completed - April 2026) Finance staff and senior leadership have completed targeted training on the application of indirect cost requirements under Uniform Guidance to reinforce compliance expectations. 2. Recalculation and Resolution of Overdraw (Implementation Initiated) The EPI Center has recalculated allowable indirect costs by applying the restricted 8 percent indirect cost rate for Teacher and School Leader Incentive Program (TSL) grants to actual expenditures incurred during the reporting period. The program officer has been informed of the miscalculation and resulting overdraw. The EPI Center will follow all applicable agency protocols upon receiving formal guidance from the U.S. Department of Education. Management is actively coordinating with the U.S. Department of Education to resolve the calculated overdraw and will comply with all agency guidance, including repayment of any amounts determined to be unallowable. Controls are now in place to ensure that all future drawdowns are calculated based on the approved indirect cost rate applied to the MTDC base and are subject to documented review prior to submission. 3. Standardized Indirect Cost Calculation Worksheets (Completed - April 2026) A standardized indirect cost calculation worksheet will be required and reviewed prior to approval of all drawdown requests. 4. Independent Oversight (Completed – June 2025) The EPI Center has engaged a third-party controller who will review and independently validate indirect cost calculations prior to submission, providing an added layer of oversight and control. Responsible Party: Finance and Compliance Manager, Third-party Controller, CEO Timeline for Completion: May 2026

The City agrees with this finding and will train their project manager and/or department supervisor on the requirements of federal programs currently underway as well as require such training before a project commences in the future.