Corrective Action Plans

Finding 558684 (2024-072)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

Questioned Costs Period of Performance Subrecipient Monitoring

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to providers were allowable and properly supported for the Social Services Block Grant. Questioned Costs: Assistance Listing # 93.667 ...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to providers were allowable and properly supported for the Social Services Block Grant. Questioned Costs: Assistance Listing # 93.667 Amount $9,098,747 Status: Corrective action in progress Corrective Action: The Department maintains that funds were not improperly charged or reported for the Social Services Block Grant (SSBG) program. The Department implemented grant-level management of all federal funds, including the SSBG program. This process consists of making grant-level adjustments between allowable grant sources to properly spend grant funds within the allowable period of performance and ensure level of effort and matching requirements are met. The Department allocated the SSBG funds to eligible clients and allowable activities in compliance with 45 CFR 98.67 but did not include the level of data recommended by the State Auditor’s Office (SAO) for some transfers. In response to the auditor’s recommendations, the Department submitted a budget request for the 2024 supplemental budget. The enacted budget included funding to implement the Department’s budget request beginning July 1, 2024. The Department is working with a developer to assist with building out the required databases between the Social Service Payment System and the Agency Financial Reporting System to allow transfers between funding sources to include transaction level data related to the expenditures. The Department is committed to collaborating with SAO to determine an appropriate methodology which identifies a sampling unit that can be used to accurately test compliance. The Department looks forward to working with SAO to resolve the data concerns in the audit of the SSBG program. The conditions noted in this finding were previously reported in finding 2023-070. Completion Date: Estimated December 2025 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 355165 Questioned Costs: $1

Finding 558665 (2024-071)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure Foster Care Maintenance payment rates were properly calculated. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Status: Corrective ...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure Foster Care Maintenance payment rates were properly calculated. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Status: Corrective action in progress Corrective Action: The Department concurs that policies and procedures related to rate setting for Foster Care maintenance payments are not currently established and is committed to strengthening internal controls and complying with federal requirements. In February 2025, the Department met with the State Auditor’s Office to gather an understanding of concerns and discuss how reasonable and allowable rates could be documented to ensure federal compliance. The Department will prioritize establishing written policies and procedures for setting payment rates to ensure maintenance payment rates only include allowable costs. Completion Date: Estimated July 2026 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 355165

Finding 558661 (2024-067)

Significant Deficiency 2024

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure monthly foster care maintenance payments to children’s caregivers were adequate and accurate for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Sta...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls to ensure monthly foster care maintenance payments to children’s caregivers were adequate and accurate for the Foster Care program. Questioned Costs: Assistance Listing # 93.658 93.658 COVID-19 Status: Corrective action complete Corrective Action: The Department is committed to strengthening internal controls and complying with grant requirements. As stated in the finding’s Cause of Condition, the Department did not fully implement the prior year’s corrective action plan during the audit period and did not have the reporting capabilities to track rate setting reviews for the entire audit period. To strengthen internal controls and documentation, and as part of the implementation of the new rate assessment process, the Department took the following corrective actions: • Published a new report in FamLink to assist rate assessors in identifying: o Six-month reviews that have not been performed timely. o Cases with upcoming rate assessments and due dates for reviews. • Implemented monthly tracking by supervisors to assist with internal controls and compliance. The Department continues to use the Plan, Do, Check, Act (continuous quality improvement process) to improve the accuracy of the new reports and provide additional training to staff as needed to ensure compliance with the requirement of performing six-month reviews of the reimbursement rates. The conditions noted in this finding were previously reported in finding 2023-067. Completion Date: June 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 355165

Finding 558646 (2024-049)

None 2024

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles

Finding: The Department of Commerce improperly charged $492,317 to earmarking requirements for the Low-Income Home Energy Assistance Program. Questioned Costs: Assistance Listing # 93.568 93.568 COVID-19 Amount $492,317 Status: Corrective action in progress Corrective Action: The Depart...

Finding: The Department of Commerce improperly charged $492,317 to earmarking requirements for the Low-Income Home Energy Assistance Program. Questioned Costs: Assistance Listing # 93.568 93.568 COVID-19 Amount $492,317 Status: Corrective action in progress Corrective Action: The Department is committed to maintaining compliance with federal guidelines and demonstrating our accountability in managing public funds. In response to the audit finding, the Low-Income Home Energy Assistance Program staff have completed the following: • Coordinated efforts with budget staff to verify the amounts expended and the deficiency reported. • Reviewed budget formulas used to calculate the required earmark as it relates to total funds expended. The Program will continue to: • Perform a thorough review of financial records, reconciliations, and adjustments to budgeting procedures to prevent future occurrences. • Implement enhanced internal controls and monitoring processes to ensure accurate budgeting and reporting of earmarked funds. The program will consult with the United States Department of Health and Human Services to seek guidance on the questioned costs. Completion Date: Estimated July 2025 Agency Contact: Gena Allen, CFE Internal Control Officer PO Box 42525 Olympia, WA 98504-2525 (360) 480-5149 Gena.Allen@Commerce.wa.gov

View Audit 355165 Questioned Costs: $1

Finding 558637 (2024-043)

Significant Deficiency 2024

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Eligibility Matching / Level of Effort / Earmarking

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over eligibility requirements for child care services paid with the Child Care and Development Fund and Temporary Assistance for Needy Families funds. Questioned Costs: Assistance Listing # 93.55...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over eligibility requirements for child care services paid with the Child Care and Development Fund and Temporary Assistance for Needy Families funds. Questioned Costs: Assistance Listing # 93.558 93.575 93.575 COVID-19 93.596 Amount $0 Status: Corrective action complete Corrective Action: In response to prior audit findings, the Department developed a corrective action plan to address the internal control deficiencies. This finding was issued due to the corrective action plan not being fully implemented during the audit period. To address the prior years’ eligibility audit findings, the Department has taken the following actions: • As of April 2024, conducted a root cause analysis of internal audit findings, particularly for cases with errors due to household composition and approved activities, and updated the desk aid with corrective actions identified. • As of May 2024: o Improved and published the desk aid outlining simplified eligibility determination process that includes procedures for those families who do not have an approved activity. o Developed updated household composition training for all staff as part of core childcare training. The Department will continue to partner with the Administration for Children and Families and follow our program integrity plan. The conditions noted in this finding were previously reported in findings 2023-059, 2022-036, 2021-035, 2020-039, 2019-032, 2018-030, 2017-026, 2016-023, 2015-026, 2014-026, 2013-017, and 12-30. Completion Date: May 2024 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 355165

Finding 558636 (2024-042)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

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

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and property supported. Questioned Costs: A...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and property supported. Questioned Costs: Assistance Listing # 93.558 Amount $67,698,747 Status: Corrective action in progress Corrective Action: The Working Connections Child Care (WCCC) program was previously managed by the Department of Social and Health Services (DSHS) and the Department of Early Learning. Since the program transitioned in 2019, the Department has been making efforts to strengthen internal controls over payments to child care providers and other grant requirements. The Department implemented grant-level management of all federal funds, including the Temporary Assistance for Needy Families grant. This consisted of making significant grant level adjustments between allowable grant sources to properly spend grant dollars within the allowable period of performance and ensure level of effort and matching requirements were met. The Department’s grant adjustments were processed based on eligible clients and allowable activities. The State Auditor’s Office (SAO) has taken issue in the past several audits and maintained that the program is not auditable without child-level data. The Department is committed to collaborating with SAO to determine an appropriate methodology that identifies a sampling unit for accurately testing compliance. During the audit period, the Department did not have the staff and resources to develop and maintain the business process redesign, as well as the information technology initiatives necessary to meet the level of assurance recommended by the SAO. In response to the auditor’s recommendations, the Department submitted a budget request for the 2024 supplemental budget. The enacted budget included funding to implement the Department’s budget request beginning in state fiscal year 2025, specifically: “Funding in this subsection must be expended with internal controls that provide child-level detail for all transactions, beginning July 1, 2024.” The Department is working with a developer to assist with building out the required databases between the Social Service Payment System and the Agency Financial Reporting System to allow transfers between funding sources to include child-level data related to the expenditures. The Department looks forward to working with SAO to resolve the child-level data concerns in the audit of the child care grant programs. The conditions noted in this finding were previously reported in findings 2023-051, 2022-035, and 2021-028. Completion Date: Estimated December 2025 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 355165 Questioned Costs: $1

Finding 558589 (2024-027)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

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

Finding: The Workforce Training and Education Coordinating Board did not have adequate internal controls to ensure compliance with level of effort requirements for the Career and Technical Education – Basic Grants to States program. Questioned Costs: Assistance Listing # 84.048 Amount $0 S...

Finding: The Workforce Training and Education Coordinating Board did not have adequate internal controls to ensure compliance with level of effort requirements for the Career and Technical Education – Basic Grants to States program. Questioned Costs: Assistance Listing # 84.048 Amount $0 Status: Corrective action in progress Corrective Action: The Workforce Board, in coordination with its partnered agencies, will develop written policies and procedures to document the monitoring process of level of effort requirements. The State Board for Community and Technical Colleges already has a document to submit semi-annual reports which the Workforce Board will utilize as a template to establish guidelines related to the level of effort reporting requirements. The Workforce Board will work on strengthening preventative controls to effectively monitor the level of effort requirements on a more continuous basis. Additionally, the Workforce Board will add language to all interagency agreements regarding the level of effort semi-annual reporting requirement and the certification that federal funds were used to supplement, not supplant, non-federal funds specific to the level of effort requirement. Completion Date: Estimated July 2025 Agency Contact: Lisa Engelhart Chief Financial Officer PO Box 43105 Olympia, WA 98504-3105 (360) 709-4620 lisa.engelhart@wtb.wa.gov

View Audit 355165

Finding 558588 (2024-026)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

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

Finding: The Workforce Training and Education Coordinating Board did not have adequate internal controls over matching requirements for the Career and Technical Education – Basic Grants to States program. Questioned Costs: Assistance Listing # 84.048 Status: Corrective action complete Cor...

Finding: The Workforce Training and Education Coordinating Board did not have adequate internal controls over matching requirements for the Career and Technical Education – Basic Grants to States program. Questioned Costs: Assistance Listing # 84.048 Status: Corrective action complete Corrective Action: The Workforce Board has internal controls to ensure the state meets the matching requirements of federal administrative expenditures. The Board will continue to work with the Office of Superintendent of Public Instruction (OSPI) to: • Ensure the required certification is submitted each year as specified in the interagency contract. • Obtain additional support with their quarterly billings. Additionally, the Board has incorporated a monitoring section into the new contracts with OSPI and the State Board for Community and Technical Colleges to enhance oversight and ensure compliance with federal matching requirements. Completion Date: January 2025 Agency Contact: Lisa Engelhart Chief Financial Officer PO Box 43105 Olympia, WA 98504-3105 (360) 709-4620 Lisa.engelhart@wtb.wa.gov

View Audit 355165

Finding 558475 (2024-016)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

Subrecipient Monitoring Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking

Finding: The Housing Finance Commission did not have adequate internal controls over earmarking requirements for the Homeowner Assistance Fund program. Questioned Costs: Assistance Listing # 21.026 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Commission h...

Finding: The Housing Finance Commission did not have adequate internal controls over earmarking requirements for the Homeowner Assistance Fund program. Questioned Costs: Assistance Listing # 21.026 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Commission has taken the following corrective actions to strengthen controls over earmarking requirements for the Homeowner Assistance Fund (HAF) program: • Developed a system to track and monitor expenditures in relation to overall program expenditures to ensure earmarking requirements are within allowable parameters. • Selected an increased percentage of approved, denied, and withdrawn HAF applications that have previously been reviewed by the contractor, as part of the Quality Control process, for a secondary review by program staff. • Reviewed a selection of HAF applications independent of the Quality Control process performed by the contractor. • Reviewed a selection of approved HAF applications prior to disbursing funds to confirm eligibility determinations are proper. The conditions noted in this finding were previously reported in finding 2023-023. Completion Date: October 2024 Agency Contact: Lucas Loranger Senior Finance Director 1000 Second Ave, Suite 2700 Seattle, WA 98104-3601 (206) 464-7139 Lucas.Loranger@wshfc.org

View Audit 355165

Finding 558460 (2024-007)

Material Weakness 2024

State of Washington C/o Office of Financial Management

WA

Internal Control / Segregation of Duties Subrecipient Monitoring Allowable Costs / Cost Principles

Finding: The Employment Security Department did not have adequate internal controls over and did not comply with federal requirements to conduct case reviews for the Benefit Accuracy Measurement program of the Unemployment Insurance program in a timely manner. Questioned Costs: Assistance Listin...

Finding: The Employment Security Department did not have adequate internal controls over and did not comply with federal requirements to conduct case reviews for the Benefit Accuracy Measurement program of the Unemployment Insurance program in a timely manner. Questioned Costs: Assistance Listing # 17.225 17.225 COVID-19 Amount $0 Status: Corrective action complete Corrective Action: The Department is committed to ensuring our Benefit Accuracy Measurement (BAM) program complies with federal regulations. Historically, the BAM unit has been challenged to maintain full levels of staffing. Staff turnover, lengthy training requirements, and unique skill sets make these positions difficult to maintain. The Department has implemented changes to position descriptions which have resulted in the hiring and retention of qualified staff. As a result, the unit has improved its case sampling timelines by implementing regular case reviews to ensure the 60-day, 90-day, and 120-day timelines are met. Additionally, the Department, in collaboration with the U.S. Department of Labor (USDOL), developed a State Quality Service Plan (SQSP) which includes metrics to improve program outcomes. The team has implemented additional internal communication to follow up on cases which are approaching the 120-day timeline. Although the 120-day timeline is not an improvement measure listed on the SQSP, the Department will continue to work with USDOL to implement guidance and processes to meet the 120-day requirement. The conditions noted in this finding were previously reported in findings 2023-009, 2022-006, 2021-005, and 2020-011. Completion Date: January 2025 Agency Contact: Jay Summers External Audit Manager PO Box 9046 Olympia, WA 98507-9046 (360) 529-6718 Joshua.Summers@esd.wa.gov

View Audit 355165

Finding 558341 (2024-003)

Material Weakness 2024

Box Butte General Hospital

NE

Reporting Matching / Level of Effort / Earmarking

Effect and recommendation The Hospital implemented a new accounting and electronic health record (EHR) system in May of 2023 and experienced significant delays in being able to bill and process claims. In addition, there was a cyberattack on the Hospital’s claims processing clearinghouse in Februar...

Effect and recommendation The Hospital implemented a new accounting and electronic health record (EHR) system in May of 2023 and experienced significant delays in being able to bill and process claims. In addition, there was a cyberattack on the Hospital’s claims processing clearinghouse in February 2024 that took the hospital offline from processing claims. These two events resulted in the financial statement audit requiring significantly more time to complete resulting in the Hospital’s financial statements and compliance audits for June 30, 2024 reporting period not being filed within the required timeline. Views of responsible officials and planned corrective actions The financial statement and compliance audit will be filed with the Federal Audit Clearinghouse shortly after issuance. Anticipated completion date Ongoing

View Audit 355131

Finding 558340 (2024-002)

Material Weakness 2024

Box Butte General Hospital

NE

Cash Management Material Weakness Matching / Level of Effort / Earmarking

Effect and recommendation The Hospital implemented a new accounting and electronic health record (EHR) system in May of 2023 and experienced significant delays in being able to bill and process claims. In addition, there was a cyberattack on the Hospital’s claims processing clearinghouse in Februar...

Effect and recommendation The Hospital implemented a new accounting and electronic health record (EHR) system in May of 2023 and experienced significant delays in being able to bill and process claims. In addition, there was a cyberattack on the Hospital’s claims processing clearinghouse in February 2024 that took the hospital offline from processing claims. These two events had a negative and material impact on overall operating results as additional accounts receivable allowances for both contractual adjustments and bad debts were necessary at June 30, 2024. The negative impact on overall operations resulted in the Hospital not meeting the required 1.5 debt service coverage ratio and having less than 90 days of cash on hand at June 30, 2024. The Hospital did receive a waiver for from the USDA regarding not meeting these loan covenants for fiscal year 2024. Views of responsible officials and planned corrective actions The implementation of the new electronic health records created a delay in operational workflow processes which required vendor modifications and corrections to the system. This delayed submitting insurance claims for reimbursement continued throughout fiscal year 2024. Operations have now stabilized and the debt service coverage ratio is expected to be in compliance in fiscal year 2025. Hospital management notified its USDA representatives and received a waiver from the required 1.5 debt service coverage ratio and required 90 days of cash on hand for the period ended June 30, 2024. Anticipated completion date Ongoing

View Audit 355131

Finding 558311 (2024-062)

Significant Deficiency 2024

State of Rhode Island

RI

Allowable Costs / Cost Principles Subrecipient Monitoring Eligibility

Each health plan reports TPL recoveries to EOHHS in its quarterly financial report (FDCR). These recoveries are used as a direct offset to medical expenses. As such, claims paid by the plans on behalf of a member with TPL will remain in the EOHHS encounter data warehouse. Health plans do not void...

Each health plan reports TPL recoveries to EOHHS in its quarterly financial report (FDCR). These recoveries are used as a direct offset to medical expenses. As such, claims paid by the plans on behalf of a member with TPL will remain in the EOHHS encounter data warehouse. Health plans do not void claims that have previously been paid to account for any TPL liability. Rather, they seek to recover from the third party any amount owed and report that amount to the state. In each of the last two fiscal years, this reduced medical expenditures by just under $8 million. 2025 Update: Following the process from 2023 and 2024, we are requesting a new TPL files from Gainwell that will be shared to each MCO. Anticipated Completion Date: Ongoing Contact Person: Jeffrey Schmeltz, Chief, Family Health Systems, Executive Office of Health and Human Services jeffrey.schmeltz@ohhs.ri.gov

View Audit 355126

Finding 558280 (2024-054)

Material Weakness 2024

State of Rhode Island

RI

Questioned Costs Eligibility Matching / Level of Effort / Earmarking

Management agrees with the finding regarding inaccurate calculations. Management disagrees with the finding regarding information about DCYF children in the system. The Office of Child Care (OCC) is continually reviewing available training materials related to CCAP eligibility and case processing ...

Management agrees with the finding regarding inaccurate calculations. Management disagrees with the finding regarding information about DCYF children in the system. The Office of Child Care (OCC) is continually reviewing available training materials related to CCAP eligibility and case processing and has identified certain gaps where additional training/clarification, and more frequent communication to processing staff is needed – specifically in income calculation/input of paystubs, confirming asset declarations, and confirming need hours. OCC is working with the DHS training department to create a CCAP-specific training to provide in-depth coverage of program requirements. OCC continues to present at quarterly meetings to highlight error findings and the critical importance of accurate documentation. In addition, the CCAP administrator works continuously with field staff and Deloitte through weekly theme meetings to identify areas where system changes can improve accuracy of eligibility determinations. OCC is currently reviewing the grace period/short-term approval policy, how it is applied to specific cases, and how it is implemented in RIBridges. The finding has been escalated from the CCAP administrator to the assistant director of the Office of Child Care to ensure continued collaboration from all facets of the eligibility work to continue to improve errors in determination. Anticipated Completion Date: Ongoing – will continue to see a decline in errors in eligibility approval. Contact Person: Nicole Chiello, Assistant Director, Office of Child Care, Department of Human Services nicole.chiello@dhs.ri.gov

View Audit 355126 Questioned Costs: $1

Finding 558259 (2024-050)

Material Weakness 2024

State of Rhode Island

RI

Questioned Costs Special Tests & Provisions Subrecipient Monitoring § 200.303

System changes to modify the time schedule that RIBridges interfaces with SWICA for processing tasks has already been submitted (RIB-141767). Currently, the interface occurs twice yearly. This will increase the frequency to quarterly. Anticipated Completion Date: October 31, 2025 Contact Person:...

System changes to modify the time schedule that RIBridges interfaces with SWICA for processing tasks has already been submitted (RIB-141767). Currently, the interface occurs twice yearly. This will increase the frequency to quarterly. Anticipated Completion Date: October 31, 2025 Contact Person: Donna Rook, Administrator, Family and Adult Services, Department of Human Services donna.m.rook@dhs.ri.gov

View Audit 355126 Questioned Costs: $1

Finding 558218 (2024-036)

Significant Deficiency 2024

State of Rhode Island

RI

Matching / Level of Effort / Earmarking Special Tests & Provisions Cash Management

RIDE’s Office of School Health & Wellness will develop a guidance document for LEAs regarding Paid Lunch Equity calculations and send communication at least annually to ensure LEAs have complied with 7 CFR Sec. 210.14(e). Anticipated Completion Date: June 30, 2026 Contact Persons: Brandon Bohl, Fi...

RIDE’s Office of School Health & Wellness will develop a guidance document for LEAs regarding Paid Lunch Equity calculations and send communication at least annually to ensure LEAs have complied with 7 CFR Sec. 210.14(e). Anticipated Completion Date: June 30, 2026 Contact Persons: Brandon Bohl, Finance Director, Department of Elementary and Secondary Education brandon.bohl@ride.ri.gov Rosemary Reilly-Chammat, Director – Office of School Health & Wellness, Department of Elementary and Secondary Education rosemary.reilly-chammat@ride.ri.gov Jennifer Goodwin, School Health Specialist, Department of Elementary and Secondary Education jennifer.goodwin@ride.ri.gov

View Audit 355126

Finding 558213 (2024-035)

Significant Deficiency 2024

State of Rhode Island

RI

School Nutrition Programs Reporting Equipment & Real Property Management

To eliminate the issue with stock discrepancies, the Central Distribution Center (CDC) will be incorporating updated software targeted toward minimizing inventory errors with the receipt, storage, and distribution of all commodities that come into the CDC. The CDC recently implemented handheld scan...

To eliminate the issue with stock discrepancies, the Central Distribution Center (CDC) will be incorporating updated software targeted toward minimizing inventory errors with the receipt, storage, and distribution of all commodities that come into the CDC. The CDC recently implemented handheld scanners for tracking purposes and stock management. The scanners have new upgrades that are designed to improve inventory picking procedures. The CDC is currently in the process of making this upgrade into our system and expects to have this fully implemented by May 31, 2025. In addition to the new software, we are at the beginning stages of a warehouse reorganization which will include a new storage location labeling system which is being designed with the intention of creating a more structured storage system for all products. In conjunction with the handheld scanners, the labeling system will include barcodes for inventory which will be matched to storage location. These labels are magnetic, durable, and removable and can be repositioned to any rack location in the warehouse as needed. We will immediately start automated cycle counts daily to detect and correct discrepancies early to ensure all issues with inventory are caught and addressed as early as possible. Similarly, the CDC will also be implementing a quarterly full inventory count with the first one occurring no later than May 31, 2025. Stock discrepancies are a major challenge but by incorporating the right strategies they can be eliminated. By leveraging automation, enforcing standard procedures, and continuously monitoring inventory we will improve our inventory efficiency. Anticipated Completion Date: May 31, 2025 Contact Persons: Terrence McNamara, Administrator Physical Resources, Department of Corrections terrence.mcnamara@doc.ri.gov Matthew Wiencis, Chief Distribution Officer, Department of Corrections matthew.wiencis@doc.ri.gov

View Audit 355126

Finding 558166 (2024-002)

Significant Deficiency 2024

Shenandoah Area Agency on Aging, INC

VA

Reporting Internal Control / Segregation of Duties Significant Deficiency

2024-002: Annual Reporting to VDARS, ALN 93.044 Special Programs for the Aging – Title III, Part B- Grants for Supporting Services and Senior Centers, ALN 93.045 Special Programs for the Aging - Title III, Part C1 – Nutrition Services, ALN 93.053 Nutrition Services Incentive Program, Reporting (Sign...

2024-002: Annual Reporting to VDARS, ALN 93.044 Special Programs for the Aging – Title III, Part B- Grants for Supporting Services and Senior Centers, ALN 93.045 Special Programs for the Aging - Title III, Part C1 – Nutrition Services, ALN 93.053 Nutrition Services Incentive Program, Reporting (Significant Deficiency) Condition The 13th Aging Monthly Report required by the pass-through agency, Virginia Department of Aging and Rehabilitative Services (VDARS) contained inaccurate revenue and expenditure data which did not agree to the general ledger. Criteria VDARS requires the annual 13th Month Aging Monthly Report to be submitted by November 15th. The report must contain complete and accurate information as a restating of the monthly reporting for the fiscal year. Cause The 13th Aging Monthly Report was not reconciled to underlying financial records, resulting in unexplained differences between the report and trial balance provided as part of the audit. Inaccurate reporting of such revenues and expenditures did not impact the outcome of requirements of the Agency to meet level of effort metrics as required under the grant awards. Effect The submission of the 13th AMR included data that did not agree to underlying financial records. This should have been caught during the course of a review process before submission. Therefore, it is considered a significant deficiency of internal controls over compliance. Repeat Finding 2013-01 Recommendation Ensure reporting is submitted accurately by the deadline stated by VDARS. Implement a review process for each monthly submission, including documentation of the review. Reconcile the federal, state and local totals reported in the Aging Monthly Report to the underlying financial records as stated in the financial system to ensure accuracy before submission to VDARS. Planned Corrective Action Management agrees with the finding. Management plans to implement a process to ensure that the AMR report will be submitted accurately.

View Audit 355080

Finding 558140 (2024-001)

Significant Deficiency 2024

Champaign-Urbana Mass Transit District

IL

Reporting Matching / Level of Effort / Earmarking § 200.303

We have reviewed the control procedures around preparation and review of the schedule of expenditures of federal awards (SEFA) and implemented an independent review of the assistance listing numbers (ALN) per the grant agreements in the initial review of the SEFA. The improved procedures will provid...

We have reviewed the control procedures around preparation and review of the schedule of expenditures of federal awards (SEFA) and implemented an independent review of the assistance listing numbers (ALN) per the grant agreements in the initial review of the SEFA. The improved procedures will provide the needed structure to fulfill management's responsibility to accurately report the grantor agency / pass-through grantor, assistance listing number, federal program name and number, and expenditures. Identification of major programs, utilizing the guidelines in the Office of Management and Budget's (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) are the responsibility of the auditor.

View Audit 355000

Finding 558138 (2024-001)

Significant Deficiency 2024

Universidad Teologica Del Caribe, Inc.

PR

Student Financial Aid Subrecipient Monitoring Matching / Level of Effort / Earmarking

Institutional Comments on Findings and Recommendations: The institution is fully aware of the Enrollment Reporting requirements and deadlines. The institution agrees with the auditor that there were two (2) cases where the enrollment status was reported late and three (3) cases where the auditors we...

Institutional Comments on Findings and Recommendations: The institution is fully aware of the Enrollment Reporting requirements and deadlines. The institution agrees with the auditor that there were two (2) cases where the enrollment status was reported late and three (3) cases where the auditors were unable to verify that changes in student status were reported. The institution informed the auditors that its current policy and procedure is to report all changes to student status monthly instead of every two months as established by the NSLDS reporting schedule to avoid cases on non or late reporting. Since the institution does not maintain copies of the report of enrollment changes that it submits to NSLDS and since the current NSLDS database does not maintain students that are inactive, it was unable to evidence the changes or updates that were made for these students to the auditors. Actions Taken or Planned: The institution has already discussed this issue as observed by the auditors with the officer in charge ofNDSLS Enrollment reporting. The institution would continue with its policy to submit Enrollment Reports monthly to update and notify changes to student's enrollment status more effectively and to avoid cases of late or non-compliance. Status of Corrective Actions on Prior Findings: Some of the issues related to this finding occurred in the past audit.

View Audit 354998

Finding 558102 (2024-005)

Significant Deficiency 2024

Florida Rural Legal Services, Inc.

AL

Allowable Costs / Cost Principles Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

This finding is related to activities on our VOCA grants. This finding is related to Finding 2024-001. 4 invoices were not approved by management. FRLS’s AP policy that was adopted in September 2024 allowed us to skip separate management approval in cases of recurring invoices such as utilities and ...

This finding is related to activities on our VOCA grants. This finding is related to Finding 2024-001. 4 invoices were not approved by management. FRLS’s AP policy that was adopted in September 2024 allowed us to skip separate management approval in cases of recurring invoices such as utilities and in cases where we have approved contracts such as rent payments, software subscriptions etc. This was our policy before September 2024, but it was not formalized before that date. As in the case of 2024-001. FRLS will modify its AP Policy and Procedures to remove this recurring payment exception and will now require all invoices be approved by management by routing invoices to management for approvals through the Teams automated system. Invoices over $5,000 will also be required to be approved by the Executive Director or their temporary designee. Such designation must be made in writing. This change will be made within the next 60 days.

View Audit 354985

Finding 558096 (2024-005)

Significant Deficiency 2024

Housing Authority of the City of Littleton

CO

Questioned Costs Allowable Costs / Cost Principles HUD Housing Programs

Finding 2024-005: U.S. Department of Housing and Urban Development – CFDA #14.155 Mortgage Insurance for the Purchase or Refinance of Existing Multifamily Housing Projects Applicable Federal Award Number and Year – HUD loan under section 207/223(f), HUD Project No. 101-11316 Allowable Costs/ Allowab...

Finding 2024-005: U.S. Department of Housing and Urban Development – CFDA #14.155 Mortgage Insurance for the Purchase or Refinance of Existing Multifamily Housing Projects Applicable Federal Award Number and Year – HUD loan under section 207/223(f), HUD Project No. 101-11316 Allowable Costs/ Allowable Activities Name of contact Person: Renee Gallegos, Finance Manager Anticipated completion date: Completed Planned Corrective Action: • Management has updated internal controls to include that all costs charged to the project are for allowable costs.

View Audit 354976 Questioned Costs: $1

Finding 558066 (2024-001)

Significant Deficiency 2024

Smithsonian Institution

DC

Internal Control / Segregation of Duties Reporting Matching / Level of Effort / Earmarking § 200.303

The Smithsonian agrees with the finding. The Smithsonian would like to add that the reports were delivered to the sponsor and that the sponsor was satisfied with them. Furthermore, the sponsor has provided written acknowledgment that they were “verbally kept up to date” by the National Postal Museum...

The Smithsonian agrees with the finding. The Smithsonian would like to add that the reports were delivered to the sponsor and that the sponsor was satisfied with them. Furthermore, the sponsor has provided written acknowledgment that they were “verbally kept up to date” by the National Postal Museum (NPM) regarding this potential delay. Moving forward, NPM will strengthen senior management oversight of report delivery, review due dates more rigorously, and enhance internal controls to ensure timely submission. Any potential delays will be confirmed in writing to the sponsor ahead of the due date, and compliance updates will be provided by NPM senior management to the sponsor on a regular basis. Additionally, NPM will establish procedures to cross train staff to perform required responsibilities applicable to the NPM Project.

View Audit 354905

Finding 558043 (2024-029)

Significant Deficiency 2024

State of Georgia/state Accounting Office-Ein Noted

GA

Questioned Costs Allowable Costs / Cost Principles Period of Performance § 200.303 § 200.403 § 200.77

Federal Fund Source liquidation is monitored monthly via the Fund Source Reconciliation Report and the Provider Utilization Report. Requests to close purchase orders associated with expiring federal fund sources are submitted to OPC accordingly. The Federal Financial Reporting Group will now have th...

Federal Fund Source liquidation is monitored monthly via the Fund Source Reconciliation Report and the Provider Utilization Report. Requests to close purchase orders associated with expiring federal fund sources are submitted to OPC accordingly. The Federal Financial Reporting Group will now have the right to close purchase orders with federal fund sources to expedite this process. Also, the Provider Utilization Report has been updated with Key Performance Indicators (KPIs), Contract End Date Exceeds Period of Performance and Payments Exceed Period of Performance, that specifically address the period of performance as of December 2024.

View Audit 354902 Questioned Costs: $1

Finding 557401 (2024-018)

Significant Deficiency 2024

State of Georgia/state Accounting Office-Ein Noted

GA

Subrecipient Monitoring Cash Management Student Financial Aid § 200.303

The monthly student reconciliations for the Direct Loan programs, including the SAS files, have resumed starting with the October 2024 SAS file. These reconciliations will continue on a monthly basis by the financial aid office, as required, and will be conducted without interruption. The reconcilia...

The monthly student reconciliations for the Direct Loan programs, including the SAS files, have resumed starting with the October 2024 SAS file. These reconciliations will continue on a monthly basis by the financial aid office, as required, and will be conducted without interruption. The reconciliation process will be closely monitored, reviewed, and approved monthly by management to ensure ongoing compliance. The loan processing team has been trained on the SAS file import process and direct loan reconciliation. They have also been provided with the necessary system resources to identify variances between Common Origination and Disbursement (COD) and Banner at the student level. Additionally, the direct loan reconciliation process documentation will undergo continuous review and monitoring by the loan processing team, with oversight from the Director of Student Financial Aid and Scholarships, to ensure accuracy and adherence to established policies with each new academic year. The loan processing team will have annual refresher training at the beginning of each academic year. Confirmation of employees, date of training, and current training process will be documented.

View Audit 354902

Corrective Action Plans

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