Corrective Action Plans

Recommendation: Strengthen controls over compliance, reporting, and cost allocation. Action Plan: - Immediate Actions (Q2 2024): - Review and document grant compliance requirements. - Implement a structured approval process for financial reports. - Long-Term Actions: - Conduct quarterly compliance training for grant managers (Q3 2024). - Engage an external consultant for a mid-year compliance review (Q4 2024). Responsible: John Opalinski Completion Date: Within 3 months of CAP issuance.

Views of Responsible Officials and Planned Corrective Action: To address the issue, the management will develop and document a clear policy for obtaining and retaining eligibility documentation. This policy should outline the specific types of documentation required and the procedures for collecting and storing them. Set up a monitoring and reporting system to track the status of eligibility documentation. Regularly review reports to ensure that all required documentation is up-to-date and complete. Anticipated Date of Completion: Ongoing analysis; expected to be completed by December 1, 2025.

Views of responsible officials and planned corrective action: The Authority accepts the recommendation of the auditor. The affected files relate to clients that have been on the program for decades and as files get large, archiving takes place. To correct this finding, a directive will be issued to staff that will ensure that when files are archived the original application must be placed in the current working file going forward. Diana Ruiz, Interim Director of Housing Programs, will be responsible to implement this corrective action by June 30, 2023.

Management agrees with the finding and has developed a set of policies and documented them. The Business Manager has implemented the changes as of June 2023.

PayChex is GCI's payroll provider and automates the GCI employee onboarding process, including having new employees complete the applicable hiring forms. GCI has directed PayChex to ensure that all new employees complete the required payroll forms prior to starting work at GCI. Estimated Correction Date March 1, 2025.

Reporting - Material Weakness in Internal Control over Compliance and Noncompliance Deemed not Material Identification of the Federal Program: Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution - 93.498. Finding Summary: The Authority tracked patiet care revenues internally within a spreadsheet. The calculations of revenue by payor within the spreadsheet and included in Period 2 report to HRSA, which are utilized to calculate lost revenues, contained errors. Responsible Individual: Dawn Ballard. Corrective Action Plan: While there were errors in the reported net patient revenue by payor for specific quarters, the total net patient service revenue, by quarter, was accurately reported and did not impact the calculated lost revenue. Management believes that the control process in place is sufficient to identify material errors in reported amounts. Anticipated Completion Date: January 15, 2025

Management agrees with the auditors’ findings and has implemented policies and procedures to improve recording accuracy of grant funds, including ensuring that all finance staff are properly trained. A guide will be created for current and future staff.

Auditee Response: The auditee agrees with the finding. This was a perfect storm of events that created this scenario including COVID requiring the discontinuation of our Point of Sale (POS) System, tally sheets by classroom being used in place of that system, a change in head cooks during the year, and a failure to communicate properly between the Director of Food Service and the new Head Cook. Action Taken: The district has and will reinstitute the use of its POS system so that a child purchasing lunch types in their number and it is credited to that child's account. This system can then be used to track meal purchases throughout the day, week, or month. Since the HeadStart classroom are not MWSD students, they do not have numbers within the system. The Director of Food Services will use this system to report meal purchases and reimbursement rather than rely on head cooks and their tally sheets. Despite this, training should be conducted annually with all head cooks as to the qualifications of a reimbursable meal within the school district, so as to provide a fail safe in the event the POS system goes down for a period of time. Timelines/Contract: Most of this has taken place already in that we have returned to using a POS system. This system has the ability to track data and run reports, so it makes it error free when available. However, people ultimately must have the knowledge too so that they understand the parameters of a reimbursable meal should the system go down. Therefore, annual trainings will be instituted regarding such operations effective immediately. The Director of Food Service will be directed to use one in-service day annually for the purpose of teaching all staff members about reimbursable meals and how the HeadStart Programs fit into that. This should be completed no later than fall of 2025. The contact person would be Joe Stroup, Superintendent.

Responsible Persons: Director of Community Support, Executive Director, Case Managers Anticipated Completion Date: February 1, 2025 / On-going Corrective Action: The management of Clayton County Community Services Authority, Inc. has reviewed the above referenced finding and fully agrees with the recommendation to enhance the design of our control activities to ensure that CSBG participant files are adequately maintained, and to strengthen controls surrounding management review of participant files during intake process. Case Managers are responsible for initiating and developing participant files for the purpose of determining eligibility for the CSBG Program. Once the file has been developed and the participant deemed eligible for assistance, the file is forwarded to the Director of Community Support for additional review and approval. Only after the file has been approved by the Director of Community Support or Executive Director will the payment request/transmittal be submitted to the Fiscal Department for processing of payment. The Fiscal Department will not process any transactions or transmitt als without the required signature approval from the Director of Community Support or Executive Director indicating the participant is eligible for benefits.

The Authority will review its policies and procedures over program compliance requirements and continue to provide occupancy training to staff to prevent future exceptions

The Authority will review its policies and procedures over program compliance requirements and continue to provide occupancy training to staff to prevent future exceptions.

County Commission gave former County Manager direction to consult with legal counsel to determine premium pay for County staff who worked throughout the Pandemic. A meeting was held between Former County Manager, Financial Specialist, County Sheriff and VMDC Warden to discuss premium pay for all staff as well as public safety recruitment and retention. Former County Manager stated after consulting with County Legal Counsel and NMC General Counsel, all County staff including, Elected Officials were eligible to receive “premium pay” in compliance with the American Rescue Plan Act Rule. Financial Specialist and County Sheriff questioned the eligibility for Elected Officials to receive premium pay referencing N.M. Const. Art IV, section 27 “No law shall be enacted giving any extra compensation to any public officer, servant, agent or contractor after services are rendered or contract made; nor shall the compensation of any officer be increased or diminished during his term of office, except as otherwise provided in this constitution.”, and NMSA 4‐44‐4.1 related to County Elected Official Salary caps. Former County Manager responded premium pay should be issued to all staff including Elected Officials through the accounts payable department instead of payroll to avoid violating New Mexico Constitution and State Statute and premium pay is not considered a salary increase but “premium pay” outside of regular salary paid to “essential workers”. Former County Manager went on to explain that all law enforcement officers were eligible for premium pay because they were described as “essential” within the American Rescue Plan Act Rule. In a regular Commissioner Meeting held on 10/12/2021 Former County Manager presented to Commission and recommended approval of public safety recruitment and retention plan as well as a one‐time payment to current staff of $5,000 who worked from January 2020 through October 2021 and a prorated rate be awarded to any employee that worked a portion of that time. She also stated new information was received that confirms all County employees are eligible for the premium pay, currently 88 employees. She also stated that public health contractors are also eligible for premium pay and recommended payment be made to 2.5 full time positions to contracted health care services provider. Commission approved the request from the Former County Manager based on her recommendation. Former County Manager drafted, reviewed and approved a list of employees scheduled to receive payment including 5 contracted medical service provider including the CEO of the company. Former County Manager directed accounts payable clerk to issue payment through accounts payable. On November 8th 2021, Former County Manager presented to and recommended approval additional premium pay be awarded to Employees that had retired and worked part of the period of January 2020 though October 2021 and two full time Employees that were laid off. In January 2022 Elected Officials requested a meeting be held to discuss the issuing of 1099 forms to employees who received premium pay. Also present in the meeting was Commission Chairman. Elected Officials raised concern that staff was issued a 1099 and questioned if this was correct. Former County Manager informed staff the advice the County got was to issue a 1099‐NEC, under the circumstances. However, upon review of email communication former County Manager received an opinion from her personal Tax Accountant stating that the payments should have been run through payroll and recommended Former County Manager either correct the original error and would require several steps including corrected 941’s and corrected w‐2’s or issue a 1099 NEC. Former County Manager directed accounts payable clerk to issue a 1099 NEC. Commission Chairman questioned several expenditures from American Rescue Plan Act Fund, including the additional 2 full time positions and CEO of the company not approved by Commission, it was later determined that several expenditures were not allowable under the American Rescue Plan Act Fund Rule. Colfax County Staff submitted written report to Office of the State Auditor as required under NMSA 1978, Section 12‐6‐6 (criminal violations) an agency or auditor shall notify the state auditor immediately, in writing upon discovery of any violations of criminal statute in connection with financial affairs. Former County Manager announced her resignation February 28, 2022. It was later discovered through communication with County legal Counsel and NMC General Counsel that Former County Manager mislead the County Commission, Elected Officials, and County Staff and did not consult with County Legal Counsel or NMC General Counsel as previously stated and as directed by the Commission before making recommendations for approval of American Rescue Plan Act Funds.

Identification of federal programs 10.558 and 21.027 – Child and Adult Care Food Program (CACFP) and Child Care and Development Block Grant (ARPA) Condition The Organization did not retain eligibility documentation for each site noting the control process. Views of Responsible Officials: Management agrees with the finding and observation. Contact Person: Fendy Wogu, Finance Controller Proposed Completion Date: October 31, 2024

Finding Number: 2022-002 Condition: WakeMed charged costs associated with ineligible individuals to the grant. Planned Corrective Action: WakeMed identified all HRSA patients with other documented insurance within the system. Each claim was reviewed to identify patients with active insurance coverage. Patients identified with active insurance coverage were considered ineligible for grant purposes, and the HRSA payments are in the process of being refunded. These costs were removed from the SEFA. In addition, WakeMed has written off all outstanding HRSA claims. Contact person responsible for corrective action: Terry Flynn, Director, Reimbursement Anticipated Completion Date: 06/14/2023

Finding 2022-009 Lack of Internal Control over Compliance Eligibility Type of Finding: Material weakness in internal control over compliance and material noncompliance Name of Contact: Jana Rae Koenig, Executive Director Corrective Action Plan: The Native Village of Point Hope will adhere to the grant agreement and Administrative Management System Manual Chapter III: Financial Management and Chapter VI: Records Management to ensure that all proper documentation is recorded and kept on-file and that authorized personnel are selected to receive program services. Proposed Completion Date: Before the end of the next audit cycle.

The Organization has created a process to move all documents to cloud based storage, including recipient agency contracts for USDA and proof of tax-exempt status under Internal Revenue Code 501(c)(3).

RHA has put in place comprehensive new procedures and controls for all staff members, including Clerks, Housing Assistants, Housing Coordinators, and Project Managers, concerning the mangaement of the waiting list process. As of September 2024, a new waiting list will be generated following each new move-in, and the previous waiting will be approximately filed and preserved. Name of Responsible Person: Entire Admin Staff Implementation date: September 2024

U.S. Department of Housing and Urban Development – CFDA #14.850 Public and Indian Housing – 2022 Eligibility Material Weakness in Internal Control over Compliance Finding Summary: Testing indicated that there were 2 errors out of the 60 files tested in the tenant’s rent calculation that were not detected by the Authority’s internal controls. In addition, there was no review of the rent calculation by another individual. Responsible Individual: Steven Trujillo, Executive Director Corrective Action Plan: We have implemented a process to ensure eligibility requirements are being followed and that another person reviews the rent calculations, once they are determined. Anticipated Completion Date: January 2023

Finding 2022-005 -Tenant Files - PH Auditee's Response and Planned Corrective Action The Authority will establish a checklist covering all Public Housing compliance requirements for tenants for the Tenant Housing Representatives to use during the move-in and recertification process which will be signed by the Tenant Housing Representative and a supervisor or member of management. The checklist will be maintained in each tenant's file. The Authority agrees with the findings, however, the Authority no longer administers the Public Housing Program due to the Section 22 conversion, so no further corrective action is applicable. Planned Implementation Date of Corrective Action: December 31, 2024 Person Responsible for Corrective Action: Harolda A. Wilcox, Executive Director

Finding 2022-004 -Tenant Files - HCV Auditee's Response and Planned Corrective Action The Authority will establish a checklist covering all Section 8 compliance requirements for tenants for the Tenant Housing Representatives to use during the move-in and recertification process which will be signed by the Tenant Housing Representative and a supervisor or member of management. The checklist will be maintained in each tenant's file. Planned Implementation Date of Corrective Action: January 31, 2025 Person Responsible for Corrective Action: Harolda A. Wilcox, Executive Director

Finding 2022-006 Compliance Requirement: Special Tests and Provisions-Sliding Fee Discounts Type of Finding: Material Weakness Condition and Context: Supporting documents could not be located for six of the twenty-five patients selected for testing. As such, we were unable to determine eligibility for those patients. Action Planned in Response to the Finding: Implement and monitor procedures to ensure all supporting documents are kept for determining patient eligibility. Official Responsible for Ensuring the CAP: Harold Minor Planned Completion Date: December 2024

2022-003 – ELIGIBILITY Material Weakness/noncompliance Auditee’s Response and Planned Corrective Action The Windsor Housing Authority currently contracts with J.D. A’melia for all Housing Choice Voucher Program services. HCV staff have a broad range of duties covering activities from application, waitlist management, initial briefing for new participants, resident processing through termination of assistance. They will also perform all property activities related to compliance with WHA’s lease for all our properties and they will have extensive contact with landlords and tenants participating in the HCV programs. More specifically, HCV staff responsibilities include but are not limited to:  Lease-ups including new tenant orientation Monthly close-out  Waitlist Management Administrative & clerical functions  Inspection coordination Processing applications  Annual and interim recertification HUD reporting  Landlord services Determining eligibility  Direct deposit set-up EIV  Calculations & payment authorization to landlords & tenants admin fees calculation and payment Person Responsible for Corrective Action: Maria DeMarco, President of DeMarco Management Corporation

The County will implement procedures to ensure the approval process is documented.

Finding No. 2022-001 Corrective Action Plan 1. Name of the contact person responsible for corrective action: Anthony G Caputo, CEO 2. Corrective action planned: Management will implement a process to provide oversight over the single audit process to ensure that all future reporting will be prepared and filed in a timely manner. 3. Anticipated completion date: The new processes will be implemented immediately for any future PRF submissions. 4. If the client does not agree with the audit findings or believes corrective action is not required, include an explanation and specific reasons: We agree with finding No. 2022-001

We agree with the finding that the same expenditures were included in reimbursement requests for assistance listings 21.023 and 14.231. The reimbursement requests were compiled using a separate database of individual clients for each assistance listing. Due to a data entry error, the same expenses were included in both databases. As part of CAC's internal controls, the databases are supposed to be reconciled to the appropriate expenditure accounts of the general ledger for each assistance listing. This reconciliation did not occur for these reimbursement requests. When Management reviewed the reimbursement request prior to submission, that review compared the reimbursement request to the database listing and not the general ledger. The following corrective action plan will minimize the occurrence of reimbursement being requested from multiple grantors for the same allowable expenditures. Beginning in the FY2025 fiscal year, invoices that are submitted to CAC management for review that are based on worksheet or database listings will be accompanied by a copy of the general ledger and amounts shown on the database or worksheet reconciled to the general ledger. The projected date for full implementation of the corrective action plan for this finding is June 30, 2025. The contact person for this corrective action are: Barbara Kelly, Executive Director, David Mincey, CAC Fiscal Services Manager/Internal Auditor, CAC Chief Financial Officer, to be selected.