Corrective Action Plans

Finding 1238440 (2025-001)

Material Weakness 2025

ID

Special Tests & Provisions Eligibility Significant Deficiency

Department of Health and Human Services Dirne Health Centers, Inc. respectfully submits the following corrective action plan for the year ended December 31, 2025. Audit period: 01/1/25 – 12/31/25 The findings from the schedule of findings and questioned costs are discussed below. The findings are nu...

Department of Health and Human Services Dirne Health Centers, Inc. respectfully submits the following corrective action plan for the year ended December 31, 2025. Audit period: 01/1/25 – 12/31/25 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FINANCIAL STATEMENT AUDIT There were no financial statement findings in the audit period. FINDINGS—FEDERAL AWARD PROGRAMS AUDITS Department of Health and Human Services 2025-01 Health Center Cluster– Assistance Listing No. 93.224 and 93.527 Recommendation: CLA recommends that the Clinic strengthen its review process over sliding fee discount determinations by implementing procedures to verify that each patient application is evaluated using current eligibility information and that the corresponding sliding fee scale level is accurately applied. CLA further recommends that the Clinic document evidence of review and approval before discounts are applied to patient encounters and establish a process for timely identification and correction of any discrepancies. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management is reviewing and strengthening Heritage Health’s Sliding Fee Discount Program procedures to ensure that sliding fee eligibility determinations are completed and documented consistently in accordance with the organization’s board-approved policies. Management will clarify procedures related to eligibility and income verification, the application of the appropriate sliding fee scale, and documentation of the review and approval process. Staff responsible for sliding fee determinations will receive training on the updated procedures. Management will also review system configuration and workflows related to the application of sliding fee discounts and establish a periodic internal monitoring process to verify that eligibility determinations are appropriately documented, the correct sliding fee level is applied, and identified discrepancies are investigated and corrected in a timely manner. Name(s) of the contact person(s) responsible for corrective action: Sonya Zhang Planned completion date for corrective action plan: December 31, 2026 If the Department of Health and Human Services has questions regarding this plan, please call Sonya Zhang at 520-667-6333.

View Audit 413305

Finding 1238434 (2025-002)

Material Weakness 2025

FIRST UNITED METHODIST CHURCH

KY

Internal Control / Segregation of Duties Material Weakness § 200.303

Disaster Grants – Public Assistance – Assistance Listing No. 97.036 Recommendation: We recommend that management implement and system of internal controls to ensure that reports are reviewed by a second person and that the reports are reconciled to the Organizations accrual basis accounting records....

Disaster Grants – Public Assistance – Assistance Listing No. 97.036 Recommendation: We recommend that management implement and system of internal controls to ensure that reports are reviewed by a second person and that the reports are reconciled to the Organizations accrual basis accounting records. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: • The Chair of the Rebuild Finance Committee (RFC) and the MFUMC Finance Secretary will prepare monthly updates to summarize the payments made for invoices related to the federal award programs. These reports will include updates to the Contract Summary and Forced Accounts Summary for the previous month. • The Rebuild Finance Committee (RFC) will review the payments to grant related invoices on a monthly basis. • The RFC will review all charges submitted related to the Administrative Support reimbursement portion of the grant on a monthly basis. This will include all finance support staff and administrative support consultant’s submitted invoices. • On a quarterly basis, the RFC will review the summary of investment accounts including funds transferred from the UM Development group, money market funds, and CDs. The finance secretary will receive copies of all money transfers, roll-overs, and interest paid. • The RFC will, on a quarterly basis, reconcile the reports from items 1.and 2. with the submitted quarterly report submitted to KYEM. Name(s) of the contact person(s) responsible for corrective action: Mitzi Guhy and Adam Rush. Planned completion date for corrective action plan: December 31, 2026. If the Cognizant or Oversight Agency for Audit has questions regarding this plan, please call Mitzi Guhy or Adam Rush at (270) 247-5678.

View Audit 413303

Finding 1238421 (2025-002)

Material Weakness 2025

New Hope Housing, Inc.

TX

Significant Deficiency Internal Control / Segregation of Duties

Finding #2025-002 – Significant Deficiency and Other Noncompliance. Federal Awards: U. S. Department of Housing and Urban Development, Passed through City of Houston, Assistance Listing #: 14.239, Contract number: 4600016100, 4600008347, 4600015112, 4600013379, 460000866, 4600009893, 4600010749, and...

Finding #2025-002 – Significant Deficiency and Other Noncompliance. Federal Awards: U. S. Department of Housing and Urban Development, Passed through City of Houston, Assistance Listing #: 14.239, Contract number: 4600016100, 4600008347, 4600015112, 4600013379, 460000866, 4600009893, 4600010749, and 03-0774/FC55324, Contract period: Grant agreement expires 15-30 years from the date of completion. U. S. Department of Housing and Urban Development, Passed through Texas Department of Housing and Community Affairs, Assistance Listing #: 14.239, Contract number: 92230123418 and 1000084, Contract period: Grant agreement expires 20-30 years from the date of completion. Condition and context: In a sample of 40 tenant files, we noted four instances where the monthly rental rate recorded on the property’s rent roll did not match the rate authorized in the signed lease contract. Recommendation: Implement a secondary review of rental agreements and rates per the property management system. Consider periodic reconciliation compliance procedures that compares a sample of active rent rolls directly against executed lease files. Planned corrective action: Effective October 1, 2026, NHH’s Property Management team will conduct monthly reconciliations comparing a sample of active rent rolls and property management system records directly against executed lease agreements and amendments. A minimum of 10% of active tenant files at each property will be reviewed monthly. Any discrepancies identified will be corrected promptly. NHH’s Compliance team will perform quarterly oversight reviews beginning January 2027 to verify that the monthly reconciliations are completed and documented and that identified discrepancies are resolved. NHH’s Vice President of Property Management and Maintenance will review the quarterly reconciliations. Responsible officer: Stacey Lastovica, Vice President of Property Management and Maintenance. Estimated completion date: Monthly Property Management reconciliations will begin on October 1, 2026, with quarterly Compliance oversight beginning in January 2027. These controls will remain ongoing.

View Audit 413281

Finding 1238419 (2025-001)

Material Weakness 2025

Island County

WA

Subrecipient Monitoring Internal Control / Segregation of Duties

County staff has previously reached out to the granting agency on how to resolve the quarterly Project and Expenditures reporting issue. Staff will review quarterly reporting to ensure the data accurately reflects the accounting records. The County is committed to obtaining the necessary training an...

County staff has previously reached out to the granting agency on how to resolve the quarterly Project and Expenditures reporting issue. Staff will review quarterly reporting to ensure the data accurately reflects the accounting records. The County is committed to obtaining the necessary training and resource materials for future ARPA reporting and subrecipient monitoring.

View Audit 413279

Finding 1238405 (2025-001)

Material Weakness 2025

Kittitas Reclamation District

WA

Cash Management Internal Control / Segregation of Duties Subrecipient Monitoring

The District acknowledges the auditor’s finding regarding the use of a cash advance during extreme and time sensitive circumstances. While cash advances are not part of the District’s normal financial practice, the situation required immediate action to ensure continuity of services funded by the fe...

The District acknowledges the auditor’s finding regarding the use of a cash advance during extreme and time sensitive circumstances. While cash advances are not part of the District’s normal financial practice, the situation required immediate action to ensure continuity of services funded by the federal granting agency. The District takes this recommendation very seriously. Throughout the period in which the cash advance remained unexpended, the District maintained complete documentation of all interest accrued, consistent with federal requirements. As soon as the auditors provided direction to remit interest exceeding the allowable $500 threshold, the District immediately issued a reimbursement check to the U.S. Department of Health and Human Services. This action was completed promptly to ensure full compliance with federal grant regulations. To prevent similar issues in the future, the District has formally adopted a written Cash Advance Policy. This policy establishes that cash advances are not standard procedure and may only be used under exceptional circumstances. It further requires monthly monitoring of any interest earned and mandates annual repayment of interest exceeding $500 to the granting agency. The policy ensures that any future need for a cash advance will be managed with clear controls, documented oversight, and strict adherence to federal guidelines. The District is committed to maintaining strong internal controls, complying with all federal grant requirements, and implementing corrective measures that strengthen financial stewardship moving forward.

View Audit 413271

Finding 1238379 (2025-002)

Material Weakness 2025

RONALD MCDONALD HOUSE CHARITIES OF OKLAHOMA CITY, INC

OK

Procurement, Suspension & Debarment Eligibility Internal Control / Segregation of Duties

Finding 2025-002 Finding Number: 2025-002 Finding Title: Documentation of Procurement and Suspension and Debarment Control Procedures Corrective Action Planned: Management believes this finding resulted from the Organization’s assessment that compliance procedures implemented through the Constructio...

Finding 2025-002 Finding Number: 2025-002 Finding Title: Documentation of Procurement and Suspension and Debarment Control Procedures Corrective Action Planned: Management believes this finding resulted from the Organization’s assessment that compliance procedures implemented through the Construction Manager were sufficient to address the suspension and debarment requirements associated with direct vendor payments. The Organization incorporated applicable federal compliance requirements into its agreement with the Construction Manager and the related subcontractor arrangements and documented its rationale regarding whether additional verification was required for vendors paid directly to preserve the Organization's sales tax exemption. The Organization has subsequently confirmed that none of the material vendors paid directly by RMHC were listed as suspended, debarred, or otherwise excluded from participation in federal programs. Therefore, management believes the finding relates to compliance documentation and retention requirements rather than the engagement of ineligible vendors. To strengthen compliance documentation in this area, management will update its procurement and federal award compliance procedures to clearly address situations in which the Organization makes direct payments to vendors using federal funds, including circumstances where the Organization does not have a direct contractual relationship with those vendors and where project procurement activities are administered through a Construction Manager or other third party. Management will update applicable checklists and written guidance, provide training to personnel responsible for federal award compliance, and implement supervisory review of covered-transaction evaluations involving direct vendor payments. Management will also ensure that documentation supporting suspension and debarment determinations and related compliance conclusions is retained in the applicable procurement and payment files. In addition, management notes that the circumstances giving rise to this finding were unique to the capital project and the Organization's previous practice of paying certain material vendors directly in order to preserve its sales tax exemption. Pursuant to Oklahoma Senate Bill 44, effective in 2026, sales tax exemptions were expanded to expressly apply to contractors and subcontractors performing work for qualified tax-exempt entities. As a result, the Organization does not anticipate the need to make direct payments to material vendors for future construction projects solely to preserve sales tax-exempt treatment, thereby significantly reducing the likelihood of similar circumstances occurring in the future. Management further notes that no federal funds were expended by the Organization during 2026. Nevertheless, management has implemented procedural revisions described above so that controls will be in place for any future federally funded activities. Responsible Person: Jenna Morey, President Anticipated Completion Date: December 31, 2026

View Audit 413231

Finding 1238366 (2025-001)

Material Weakness 2025

Pennsylvannia Certified Organic

PA

Internal Control / Segregation of Duties Subrecipient Monitoring Material Weakness

Corrective Action Plan Steps & Status - Complete All planned remediation measures have been fully implemented, including strengthened authentication and access controls across ﬁnancial institutions, enhanced transaction monitoring, updated authorization policies, a reassessment of banking relationsh...

Corrective Action Plan Steps & Status - Complete All planned remediation measures have been fully implemented, including strengthened authentication and access controls across ﬁnancial institutions, enhanced transaction monitoring, updated authorization policies, a reassessment of banking relationships, and increased staff training and cyber insurance coverage. 1. Multi-factor Authentication for all ﬁnancial institutions and key business systems 2. Segregation of user controls for all ﬁnancial institutions 3. ACH/wire limit review of all ﬁnancial institutions 4. ACH and Positive Pay enabled for operating account 5. New Vendor / Vendor changes policy 6. Reassess Banking Institutions for security and alignment with PCO banking needs 7. Ongoing staff cyber security training 8. Increase Cyber insurance coverage

View Audit 413210

Finding 1238363 (2025-002)

Material Weakness 2025

CAPITAL CITY AREA COUNCIL FOR SPECIAL SERVICES

MO

Reporting Internal Control / Segregation of Duties

Recommendation: We recommend that the Board of Directors be aware of the internal control deficiencies over financial reporting. And, if possible, implement procedures to ensure that the Organization has the expertise necessary to prevent, detect and correct misstatements and be capable of drafting ...

Recommendation: We recommend that the Board of Directors be aware of the internal control deficiencies over financial reporting. And, if possible, implement procedures to ensure that the Organization has the expertise necessary to prevent, detect and correct misstatements and be capable of drafting the financial statements, related footnote disclosures and SEFA in accordance with the accounting principles generally accepted in the United States of America (U.S. GAAP).

View Audit 413199

Finding 1238363 (2025-002)

Material Weakness 2025

CAPITAL CITY AREA COUNCIL FOR SPECIAL SERVICES

MO

Reporting Internal Control / Segregation of Duties

Views of responsible officials and planned corrective actions: The Board believes it has personnel who possess suitable skill, knowledge, or experience to oversee services the auditor provides in assisting with financial statement presentation which requires a lower level of technical knowledge than...

Views of responsible officials and planned corrective actions: The Board believes it has personnel who possess suitable skill, knowledge, or experience to oversee services the auditor provides in assisting with financial statement presentation which requires a lower level of technical knowledge than the competence required to prepare the financial statements, related footnote disclosures and SEFA in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).

View Audit 413199

Finding 1238345 (2025-003)

Material Weakness 2025

Softwood Export Council

OR

Allowable Costs / Cost Principles Internal Control / Segregation of Duties § 200.302 § 200.303

2025-003 – Finding: Material Weakness in Internal Controls over Compliance: Allowable Costs and Allowable Activities Responsible official: Rose Braden, President Context and Cause: SEC did not document a separate review of allowable costs and allowable activities for disbursements by someone other t...

2025-003 – Finding: Material Weakness in Internal Controls over Compliance: Allowable Costs and Allowable Activities Responsible official: Rose Braden, President Context and Cause: SEC did not document a separate review of allowable costs and allowable activities for disbursements by someone other than the recording accountant. Recommendation: Management should establish and implement procedures requiring invoices to be reviewed and approved by an authorized individual, independent of the recording function, with knowledge of the requirements of the program. The review should be documented. Corrective Action Planned: SEC will update processes and policies. A documented review process will be added to the disbursement process. Implementation date: December 31, 2026

View Audit 413184

Finding 1238343 (2025-002)

Material Weakness 2025

Softwood Export Council

OR

Internal Control / Segregation of Duties Material Weakness § 200.303

2025-002 – Finding: Material Weakness in Internal Controls over Compliance and Noncompliance: Documented Policies Responsible official: Rose Braden, President Context and Cause: SEC has a documented fiscal policy; however, the policy does not include procedures that cover specific compliance attribu...

2025-002 – Finding: Material Weakness in Internal Controls over Compliance and Noncompliance: Documented Policies Responsible official: Rose Braden, President Context and Cause: SEC has a documented fiscal policy; however, the policy does not include procedures that cover specific compliance attributes associated with federal award requirements. 2 CFR 200.303 requires the recipient to establish, document, and maintain effective internal control over federal awards. Recommendation: It was recommended that SEC develop, document, and implement policies and procedures that address the recent guidance regarding applicable federal compliance requirements. Corrective Action SEC will update processes and policies. A review process will be added to the monthly closing process. Segregation of duties will be added over transaction cycles. Implementation date: December 31, 2026

View Audit 413184

Finding 1238340 (2025-003)

Material Weakness 2025

Bronx Community Health Network, Inc.

NY

Reporting Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

Bronx Community Health Network, Inc. (“BCHN”) Corrective Action Plan For the Year Ended December 31, 2025 Health Resources and Services Administration (“HRSA”) Federal Award Finding Finding 2025-003 – Reporting Description of Finding: There was no evidence of the review and approval of the Uniform D...

Bronx Community Health Network, Inc. (“BCHN”) Corrective Action Plan For the Year Ended December 31, 2025 Health Resources and Services Administration (“HRSA”) Federal Award Finding Finding 2025-003 – Reporting Description of Finding: There was no evidence of the review and approval of the Uniform Data System (UDS) before its submission. Statement of Concurrence: We concur with the finding above. Corrective Action: Management has implemented a formal UDS review and approval process requiring management review and documented approval by the designated responsible official prior to submission. In this process, the CFO will email the draft UDS report to the CEO for review. Once the UDS is reviewed, the CEO will email the CFO approving the UDS report. Then the CFO will submit the report. Evidence of the review and approval will be maintained and retained with the final UDS submission documentation to ensure accuracy, completeness, and compliance with reporting requirements. Completion Date: 09/10/2026 Name of Contact Person: Alicia Tenny Chief Financial Officer Tel. No.: (917) 364-1156 E-mail: atenny@bchnhealth.org If HRSA has questions regarding this Corrective Action Plan, please call Alicia Tenny at (917) 364-1156. Sincerely yours, _________________________ Alicia Tenny Chief Financial Officer

View Audit 413181

Finding 1238301 (2025-001)

Material Weakness 2025

Hands of Healing Residential Treatment Center, Inc.

TX

Reporting Internal Control / Segregation of Duties

Management understands that annual performance reports are required to be submitted no later than 90 days after the end of each budget period. Management understands that final performance reports are required to be submitted no later than 90 days after the end of the project period. To ensure compl...

Management understands that annual performance reports are required to be submitted no later than 90 days after the end of each budget period. Management understands that final performance reports are required to be submitted no later than 90 days after the end of the project period. To ensure compliance, , management will delegate oversight responsibilities for completion of all PRPs to the Chief Financial Officer (CFO). The CFO will be responsible for reading the Notice of Awards and calendaring out all PRP due dates and ensure timely completion by program staff. Contact Person Responsible for Corrective Action: Mr. Victor Weetly, President. Anticipated Completion Date: The corrective action plan will be completed by September 30, 2026.

View Audit 413174

Finding 1238300 (2025-002)

Material Weakness 2025

Marquette County

WI

Internal Control / Segregation of Duties

Finding 2025-002 Repeat of Finding 2024-002 Program Federal Assistance Listing and Title: 93.778 Medicaid Cluster Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Wisconsin Department of Health Services Award Numbers: 62, 284, 878, 560152, 560155 Criteria: The State ...

Finding 2025-002 Repeat of Finding 2024-002 Program Federal Assistance Listing and Title: 93.778 Medicaid Cluster Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Wisconsin Department of Health Services Award Numbers: 62, 284, 878, 560152, 560155 Criteria: The State Single Audit Guidelines (SSAG) require that local entities receiving State awards establish and maintain internal control designed to reasonably ensure compliance with laws, regulations and program compliance requirements. The Uniform Guidance and State Single Audit Guidelines further require auditors to obtain an understanding of the local entity's internal control over federal and state programs. To minimize the risk of errors, internal controls should be in place for all program compliance requirements, including the preparation and submission of reports, which should be reviewed and approved by a responsible party other than the original preparer. Condition/Context: The County does not have controls in place to ensure there is documentation of the approval/review of reports prior to submission. The annual WIMCR report tested did not have documentation of approval. The sample was not statistically valid. Corrective Action Plan Corrective Action Planned: The county is reviewing and updating its internal controls to put processes in place to ensure documentation of the review process prior to submittal of reports. Name(s) of Contact Person(s) Responsible for Corrective Action: Mandy Stanley and Jennifer Vote. Anticipated Completion Date: Beginning with reports dated 1/1/2026 and later.

View Audit 413169

Finding 1238299 (2025-004)

Material Weakness 2025

Marquette County

WI

Allowable Costs / Cost Principles Reporting Matching / Level of Effort / Earmarking

Finding 2025-004 Repeat of Finding 2024-004 Program Federal Assistance Listing and Title: 93.778 Medicaid Cluster Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: 62, 284, 878, 560152, 560155 State Program ID Number and Title: 437.3561/3681 CW Children and Families S...

Finding 2025-004 Repeat of Finding 2024-004 Program Federal Assistance Listing and Title: 93.778 Medicaid Cluster Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: 62, 284, 878, 560152, 560155 State Program ID Number and Title: 437.3561/3681 CW Children and Families State Agency: Wisconsin Department of Children and Families State Program ID Number and Title: 435.560100 ADRC 435.000561/000681 Basic County Allocation State Agency: Wisconsin Department of Health Services State Program ID Number and Title: 395.168 Specialized Transit County Operating Aids (Elderly & Disabled) State Agency: Wisconsin Department of Transportation State Program ID Number and Title: 435.000283 IMAA State Share State Agency: Wisconsin Department of Health Services Award Numbers: Unknown Criteria: 2 CRF 200.303 Internal Controls requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements. The State Single Audit Guidelines (SSAG) require that local entities receiving State awards establish and maintain internal control designed to reasonably ensure compliance with laws, regulations and program compliance requirements. To minimize the risk of errors, internal controls should be in place for all program compliance requirements, including appropriate review and approval of expenditures. Condition/Context: During our testing, we were unable to view approval for the following number of payroll expenditures in each program: 93.778: 9 out of 19 expenditures tested. 435.000561/000681, 437.3561/3681: 12 out of 40 expenditures tested. 435.560100: 9 out of 19 expenditures tested. For programs 395.168 and 435.000283, these are carried over from the prior year as controls have not changed within the system. These samples were not statistically valid. Corrective Action Plan Corrective Action Planned: In response to Finding 2025-004 regarding Internal Control Over Financial Reporting, note that the County is aware that there is lack of coovnetrr iotsls y ear-end financial reporting process. The County will endeavor to evaluate the need to increase additional staff to meet the deficiencies noted in the finding. However, due to its size, the County does not feel it is cost-effective to hire the number of employees needed to complete these task in house at this point in time and will rely on an outside audit firm. Administration is aware the current payroll and financial system allows to only go back to view payroll approvals within one year. Name(s) of Contact Person(s) Responsible for Corrective Action: Ron Barger, Marquette County Administrator Anticipated Completion Date: Administration will examine the lack of internal financial reporting on a yearly ongoing basis.

View Audit 413169

Finding 1238297 (2025-005)

Material Weakness 2025

Marquette County

WI

Internal Control / Segregation of Duties Matching / Level of Effort / Earmarking

Finding 2025-005 Repeat of Finding 2024-002 Program Federal Assistance Listing and Title: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Wisconsin Department of Health Services Award Numbers: Unkown ...

Finding 2025-005 Repeat of Finding 2024-002 Program Federal Assistance Listing and Title: 21.027 COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Wisconsin Department of Health Services Award Numbers: Unkown Criteria: Section The Uniform Guidance requires non-federal entities receiving federal awards to establish and maintain effective internal control designed to reasonably ensure compliance with federal statutes, regulations, and the terms and conditions of the federal award. To minimize the risk of errors, internal controls should be in place for all program compliance requirements, including the preparation and submission of reports. Reports should be reviewed and approved by a responsible party other than the original preparer, with documentation maintained to evidence the review and approval. Condition/Context: The County does not have controls in place to ensure there is documentation of the approval and review of reports prior to submission. For the current year single audit, the March and August monthly GEARS reports were selected for testing. For both reports tested, the County was unable to provide documentation evidencing review and approval by an individual other than the preparer prior to submission. The sample was not statistically valid. Corrective Action Plan Corrective Action Planned: The county is reviewing and updating its internal controls to put processes in place to ensure documentation of the review process prior to submittal of reports. Name(s) of Contact Person(s) Responsible for Corrective Action: Jayme Sopha, Health Director Anticipated Completion Date: 12/31/25

View Audit 413169

Finding 1238296 (2025-001)

Material Weakness 2025

Sunray Communities, Inc.

TX

HUD Housing Programs Significant Deficiency Internal Control / Segregation of Duties

CORRECTIVE ACTION PLAN Name and Number of the Project: Sunray Communities, Inc. No. 112-EE003 Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2025 Compliance Review A. Comments on Findings and Recommendations We concur with the findings and recommendations of our auditors regardin...

CORRECTIVE ACTION PLAN Name and Number of the Project: Sunray Communities, Inc. No. 112-EE003 Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2025 Compliance Review A. Comments on Findings and Recommendations We concur with the findings and recommendations of our auditors regarding our noncompliance as cited in the accompanying Schedule of Findings and Questioned Costs. Actions Taken FINDING 2025-001: Supportive Housing for the Elderly, Assistance Listing 14.157 CORRECTIVE ACTION COMPLETED: An adjusting audit entry was made to reduce the property management fees and an accounts receivable - other from the property management company was created for the overpayment. Management will monitor the expenses to ensure in compliance with the HUD approved Form 9839. We have prepared the corrective action plan as required by the standards applicable to financial statements contained in Government Auditing Standards and by the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards. Any questions regarding the above corrective action plan should be directed to Ms. Natalie Bastien, Vice President, RPM Living.

View Audit 413165

Finding 1238290 (2025-001)

Material Weakness 2025

St. Mary's Community Services

CA

Internal Control / Segregation of Duties

Condition The audit identified deficiencies in documented financial reporting processes and internal control procedures, including policies, reconciliations, review procedures, segregation of duties, and financial close processes. Corrective Action Plan Management has strengthened financial reportin...

Condition The audit identified deficiencies in documented financial reporting processes and internal control procedures, including policies, reconciliations, review procedures, segregation of duties, and financial close processes. Corrective Action Plan Management has strengthened financial reporting controls through the development and implementation of formal policies and procedures, enhanced reconciliation processes, documented review controls, and staff training. Actions included: • Develop and implement a comprehensive Accounting Policies and Procedures Manual covering revenue recognition, receivables, accruals, advanced collections, fixed assets, journal entries, monthly close, year-end close, and financial reporting. • Establish standardized month-end and year-end close checklists, including assigned responsibilities and deadlines. • Implement a formal schedule requiring monthly reconciliation of all balance sheet accounts and document management review and approval procedures. • Develop written policies governing balance sheet reconciliations and journal entry preparation, approval, documentation, and retention. • Implement documented monthly financial statement reviews, including budget-to-actual and balance sheet variance analysis. • Develop a segregation-of-duties matrix identifying responsibilities and compensating controls. • Cross-train accounting personnel and document key financial processes to improve continuity and reduce operational risk. Responsible Official Chief Financial Officer. Completion Date June 2026.

View Audit 413145

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Finding Three: 2025-003 Material Weakness in Internal Control; Material Noncompliance, Cash Management/Allowable Costs

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Auditor’s Recommendations:

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Recommended that management immediately segregate the duties of vendor setup, invoice entry, payment authorization, and bank reconciliation. If limited staffing prevents full segregation, management must implement strict compensating controls. Having a senior executive, outside of the process, indep...

Recommended that management immediately segregate the duties of vendor setup, invoice entry, payment authorization, and bank reconciliation. If limited staffing prevents full segregation, management must implement strict compensating controls. Having a senior executive, outside of the process, independently review, sign off on monthly bank reconciliations and change logs for the vendor master file.

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Management Response:

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Finance Director, Richele Center, will develop the Homes First’s set of financial policies regarding Vendor Controls and Cash Disbursement. And as mentioned in our first response creation of a Bank Reconciliation Policy aligned with practices outlined in the GAO Green Book and COSO Framework requiri...

Finance Director, Richele Center, will develop the Homes First’s set of financial policies regarding Vendor Controls and Cash Disbursement. And as mentioned in our first response creation of a Bank Reconciliation Policy aligned with practices outlined in the GAO Green Book and COSO Framework requiring no single individual having controls over all phases of cash disbursement transactions.

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Finance Director will develop a policy for Vendor Accounts and Cash Disbursements with a segregation of duties regarding vendor setup, invoice entry, payment authorization and disbursement process. This is to avoid disbursements that could be processed using Federal Funds and conceal transactions wi...

Finance Director will develop a policy for Vendor Accounts and Cash Disbursements with a segregation of duties regarding vendor setup, invoice entry, payment authorization and disbursement process. This is to avoid disbursements that could be processed using Federal Funds and conceal transactions without timely detection to fraud.

View Audit 413138

Finding 1238287 (2025-003)

Material Weakness 2025

Homes First

WA

Internal Control / Segregation of Duties

Timing of remediation:

View Audit 413138

Corrective Action Plans

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