Corrective Action Plans

Finding 2023-034 – Corrective Action Plan The auditee does concur with the few exceptions found; however, the auditee feels that these exceptions are not the result of a lack in compensating controls. These exceptions are de minimis in the full scope of the UI program. Nonetheless, future enhancement and modernization of technical systems will reduce instances of these exceptions even further. Furthermore, under the UI PERFORMS Core Measures, the acceptable level of performance for improper payments is 10% or less. The above percentages are well within this ALP. Anticipated Completion Date: Not Applicable Contact Person: Philip D’Ambra, Director, Income Support, Department of Labor & Training philip.l.dambra@dlt.ri.gov

2023-003 Allowable Cost- Payroll Recommendation We recommend that the schools develop internal controls and procedures to ensure the documentation is consistently maintained and readily available to support compliance with grantor’s requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: 1. Requirements to support documentation of payroll expenditures will be reviewed with school staff annually as part of grant support visits, resource materials provided and other technical assistance sessions. 2. As part of Spring 2024 site visits to be completed prior to June 30, 2024, Title I specialists will review with school staff requirements for documentation to support payroll expenditures using Title I funds. Documentation of stipend and temporary staff payroll will be collected and saved in the school’s grant monitoring folder. This activity will also occur in September 2024 for summer stipend/temp staff payments. 3. Charter schools utilizing Title II and/or Title IV funds will continue to participate in twice annual monitoring by the Office of Data Monitoring and Compliance to review support documentation for any stipend/temporary staff payments. 4. Schools leveraging ESSER funds in SY23/24 for stipend/temporary staff payments will be requested to upload support documentation to a district established SharePoint site prior to June 30, 2024. 5. By April 30, 2024 requirements for payroll expenditure documentation will be reviewed with district offices implementing grant funded district initiatives. These meetings include Title I, Title II, Title III, Title IV, Perkins and COVID relief grant funds. All district offices will be required to save support documentation for stipend and temporary staff payments for district level and/or district coordinated activities to a SharePoint folder to ensure accessibility for future monitoring activities. The district staff person from the Office of Data Monitoring and Compliance assigned to support the federal grant will review uploaded materials to ensure the documentation supports payroll expenditures. Name(s) of the contact person(s) responsible for corrective action: Kimberly Hoffmann Planned completion date for corrective action plan: June 2024.

U.S. Department of Housing and Urban Development (“HUD”) Norwood Life Society respectfully submits the following corrective action plan for the year ended December 31, 2023. Audit period: January 1, 2023 – December 31, 2023 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—FEDERAL AWARD PROGRAMS AUDITS Department of Housing and Urban Development 2023-001 Mortgage Insurance_Nursing Homes, Intermediate Care Facilities, Board and Care Homes and Assisted Living Facilities – Assistance Listing No. 14.129 Recommendation: We recommended to Management that they continue to monitor related party transactions and request prior approval before any advances are made or considered to be made in support of other related parties in the future. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Rick Steffens, the CFO, will oversee this plan, and the plan has been implemented and fully resolved. The unauthorized loan was due to an increasing intercompany balance due from an affiliated nursing home (“Bethesda”) who was losing money and unable to reimburse Norwood Crossing for shared bills for items including benefits and insurance. Due to the size of the losses, we realized this issue was unable to be resolved without disposing of Bethesda and began working on selling Bethesda in the second quarter of 2022. Bethesda was supposed to close on the sale on November 30, 2022, which would have solved the intercompany issue during the 2022 audit year, which was our plan. However, the sale was continuously delayed due to numerous serious issues pushing the actual sale date all the way back to July 1, 2023. The audit finding for the unauthorized intercompany loan was for $1,724,731.69, and was a finding on the 2022 audit. However, the intercompany balance continued to grow in 2023 and had an additional $574,583.86 of expenses that built up in 2023 before the sale occurred. This made a grand total of $2,299,315.55 that needed to be repaid from Bethesda to Norwood Crossing for the unauthorized intercompany loans through the sale date. Bethesda worked to repay the intercompany loans the best it could during 2023 before the sale occurred, and completely paid down the remaining balance on the unauthorized intercompany loans shortly after the sale of Bethesda occurred. The following payments were made from Bethesda to Norwood Crossing: Payment Dates Payment Amounts 5/8/2023 $675,000.00 5/23/2023 $350,000.00 7/17/2023 $1,274,315.55 Total $2,299,315.55 These repayments above fully resolved the unauthorized intercompany loans that were 1) in the 2022 Audit as a finding, 2) increases that occurred in 2023 after the 2022 year end, and 3) the resolutions occurred before the 2022 audit was issued and only are a finding in the 2023 audit because the loans were not fully paid off as of 2022. Furthermore, Bethesda has officially been sold as of July 1, 2023 and is no longer causing this issue to continue to occur going forward. Name(s) of the contact person(s) responsible for corrective action: Rick Steffens Planned completion date for corrective action plan: July 17, 2023 If the Oversight Agency for Audit has questions regarding this plan, please call Rick Steffens at 773-577-5334.

Identifying Number: Finding No. 2023-003: Documentation of Internal Controls Internal Control over Compliance Material Weakness Finding: Audit procedures noted controls identified by management over material compliance requirements lacked sufficient documentation to conclude application of controls is in place. Corrective Actions Taken or Planned: Responsible Official: T.J. Snowden (Director of Financial Aid), Walter Brown (CFO) Anticipated Completion Date: 05/30/2024 View of Responsible Individuals: Management agrees with the assessment and the finding. Management will identify what controls need to be in place to ensure federal compliance requirements for Student Financial Aid are in place. These controls will include manual or electronic signoff to exhibit proper execution of controls.

Identifying Number: Finding No. 2023-002: Special Tests – Enrollment Reporting and Gramm-Leach-Bliley Act Compliance/Material Weakness Finding: Instances of noncompliance have been identified around major compliance requirements Enrollment Reporting and Gramm-Bleach-Bliley Act, which are both part of special tests identified in the 2023 Compliance Supplement. ¬ Corrective Actions Taken or Planned: Responsible Official: Iman Riddick, Registrar, Dean Lane, Chief Information Officer (CIO) Anticipated Completion Date: 06/30/2024 View of Responsible Individuals: Management agrees with the assessment and finding. Dean Lane, CIO, will review the annual updates to the Student Financial Assistance Cluster within the OMB Compliance Supplement to ensure the Institute has policies, procedures, and controls in place for all required compliance requirements. For the noncompliance identified around the Gramm-Leach Bliley Act, the Institute will ensure compliance by establishing a formal written policy that will be created by Dean Lane, CIO, that addresses all required elements for a written information security program listed in the OMB Compliance Supplement. The CFO will review the policy once completed to ensure all required elements within the Compliance Supplement are included. For the noncompliance identified around the Enrollment Reporting special test, the Institute plans to have the Registrar attend comprehensive trainings around enrollment reporting offered by the National Student Clearinghouse (NSC) to further educate and enhance their understanding around the enrollment reporting compliance requirement. In addition, the Institute will have each month’s enrollment data submission by the Registrar to the National Student Clearinghouse reviewed by the Director of Financial Aid to verify completeness, accuracy, and timeliness of reporting. This will allow the Institute to correct any inaccurate reporting and verify timely submissions.

This finding is related to activities on our VOCA grants. As was the case in Finding #004, the majority of the exceptions were related to either finding #2 above or were related to the process in place prior to May 2023. Again, in May 2023 FRLS added an electronic transaction approval process via teams, that documents approvals for all our AP, AR and other transactions initiated by our accounting staff. These are reviewed and approved by the CFO before being posted into the GL. It was also noted that our process of allocating costs from our overhead cost centers to our various grants, was not fully documented. The CFO will undertake a review of this process to ensure that we are in compliance with allowable cost documentation requirements. We will also review and update our documentation of allocations and ensure that each month’s allocation is properly approved. This review will be completed within the next 90 days.

This finding is related to activities in our Legal Services Basic Field Grant. In reviewing the testing for this finding, the majority of the exceptions were related to either finding #2 above or were related to the process in place prior to May 2023. Again, in May 2023 FRLS added an electronic transaction approval process via teams, that documents approvals for all our AP, AR and other transactions initiated by our accounting staff. These are reviewed and approved by the CFO before being posted into the GL. The CFO will undertake a review of this process to ensure that we are in compliance with allowable cost documentation requirements. This review will be completed within the next 90 days.

2023-004 Proper Approval of Expenditures We have implemented a new electronic timesheet system. Our Director of Finance will review system reports monthly to ensure proper supervisory review and sign-offs have occurred.

Corrective Action: The University has contracted with Grant Works to review current internal controls and develop a comprehensive plan to strengthen compliance and identify gaps in current policies and procedures. The firm will conduct an extensive review of awarded grants and regulations as outlined in 2 CFR 200, providing recommendations and a week-long training for all grant staff, financial management staff, and identified administrators. Contact Person: Austen Powell, Director of Sponsored Projects Administration Completion Date: In progress, contract signed, and services started 3/19/24

Reference Number: 2023-001 Prior Year Finding: 2022-002 Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grants/Entitlement Grants Assistance Listing Number: 14.218 Award Number and Year: B-19-UC-24-0002 (7/31/2019 – 9/1/2027), B-20-UC-24- 0002 (8/17/2020 – 9/1/2028), B-21-UC-24-0002 (10/27/2021 – 9/1/2029), B-22-UC-24-002 (7/1/2022 – 9/1/2029) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend that the County develop internal controls and procedures to ensure that FFATA reporting requirements are met. We further recommend the County develop controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: DHCD will review and update procedures to ensure the department is in full compliance with the FFATA guidelines. In addition, DHCD will review all remaining balances from prior year grant awards and record the awards in FSRS. Name(s) of the contact person(s) responsible for corrective action: Edren Lewis, Chief Budget, Accounting and Loan Servicing Manager Planned completion date for corrective action plan: June 30, 2024 Any questions concerning the findings or corrective action plan can be directed to Aspasia Xypolia, Director, DHCD at 301-883- 5531.

Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Period 4 TIN #370645239 Reporting Finding Summary: The Organization included a lost revenues in the Department of Health and Human Services (HHS) special report for Period 4 that were incorrectly calculated which caused the report to be inaccurate. Responible Individuals: Paul Courtney, CFO Corrective Action Plan: Management will enhance internal controls to ensure the lost revenue calculation reported on the HHS special report meet the requirements of the federal program. Anticipated Completion Date: June 30, 2024

Department of Housing and Urban Development Federal Financial Assistance Listing #14.128 Section 242 – Mortgage Insurance ‐ Hospitals Reporting Finding Summary: The Section 242 – Mortgage Insurance ‐ Hospitals Program requires quarterly reports and certain annual reports. For the year ended July 31, 2023, the Organization failed to file the annual budget prior to the start of the year. Responsible Individuals: Paul Courtney, CFO Corrective Action Plan: Management will enhance internal controls to ensure that required reports under the Section 242 Program are submitted timely and accurately. Anticipated Completion Date: June 30, 2024

Department of Housing and Urban Development Federal Financial Assistance Listing #14.128 Section 242 – Mortgage Insurance – Hospitals Department of Health and Human Services Federal Financial Assistance Listing #93.498 COVID‐19 Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Applicable Federal Award Number and Year – Period 4 TIN #370645239 Preparation of Schedule of Expenditures of Federal Awards - Other Finding Summary: Eide Bailly LLP prepated the consolidated schedule of expenditures of federal awards ("Schedule") and the accompanying notes to the Schedule as the Organization does not have a system of internal control adequate for its preparation. Responsible Individuals: Paul Courtney, CFO Corrective Action Plan: Given the size of the Organization and its limited staffing, it will be necessary for the entity to continue its reliance on Eide Bailly LLP for completion of future Schedules. Anticipated Completion Date: Ongoing

Finding Number: 2023-005 Assistance Listing, Federal Agency, and Program Name 10.558, U.S. Department of Agriculture, Child Care and Adult Food Program Federal Award Identification Number and Year 15-016-271P-00 Pass through Entity Illinois State Board of Education Finding Type Material weakness Repeat Finding No Criteria Per 2 CFR 200.303(a), the nonfederal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with guidance in "Standards for Internal Control in the Federal Government," issued by the Comptroller General of the United States, or the "Internal Control Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Other requirements include: a) Per 7 CFR 226.10(c)(1), prior to submitting its consolidated monthly claim to the State agency, each sponsoring organization must perform edit checks on each facility's meal claim; per 7 CFR sections 226.16(g) and (h), a sponsoring organization must disburse advance and meal reimbursement payments to centers and day care homes under its sponsorship within five working days of receiving them from its state agency. b) Per 7 CFR 226.15(f), each sponsoring organization of day care homes shall determine which of the day care homes under its sponsorship are eligible as tier I day care homes c) Communication from the passthrough entity to return to pre COVID 19 monitoring, as required under 7 CFR 226.16(d)(4)(iii), effective October 1, 2022, where sponsoring organizations are required to perform onsite monitoring of each of its facilities three times every year, which includes requirements to ensure the amount of time between reviews does not exceed six months (unless review average is used). Condition A lack of documented controls as evidence of supervisory review and segregation of duties to ensure compliance with Federal program requirements, specifically over: a) monthly expenditure reports submitted to the passthrough entity b) tier (day care home eligibility) determinations c) subrecipient monitoring Questioned Costs None Identification of How Questioned Costs Were Computed N/A no instances of material noncompliance noted that would result in questioned costs Context a) During testing a sample of 5 monthly expenditure submissions, we noted no formally documented supervisory review in place. Additionally, during testing of 40 disbursements to providers, we noted no formally documented supervisory review to ensure disbursements to providers are made within 5 working days of receipt from the State passthrough entity. b) While gaining an understanding of controls over tier (day care home eligibility) determinations, we noted no controls established to ensure supervisory review of these determinations. c) While testing a sample 40 provider monitoring visits, we noted 3 visits without evidence of supervisory review and 6 visits where the visit was completed and validated in the software by the same individual. Additionally, we noted 16 day care homes and 2 day care centers with less than the required 3 annual on site monitoring visits for the year, and 15 day care homes and 2 day care centers where onsite monitoring performed were more than the required 6 months apart. Cause and Effect A lack of effectively designed, implemented, and operating controls in any of these areas could result in a material noncompliance with program requirements or Uniform Guidance. Recommendation We recommend management formalize documentation of a supervisory review of: a) monthly expenditure submissions before submitting to the passthrough entity, including documented supervisory controls to ensure disbursement timeliness is met within 5 working days as part of this review; b) of data used in making tier/eligibility determinations for accuracy and completeness; and c) of subrecipient monitoring. Additionally, we recommend management work with its passthrough entities to confirm compliance requirements, especially when compliance requirements change as the result of ending or expiring waivers and flexibilities. Planned Corrective Action Plan –Organization will document process that is used for second review of the monthly expenditure submissions by 04/30/2024. There are no instances of the Organization not providing funds to provider within the mandated 5 days, however, the Organization will document the process for provider payments within 5 days by 04/30/2024. The software required to be used by the funder for management of the program does have limitations on how the data input for making tier/eligibility determinations second review is documented. Organization will design process to document this second review has occurred by 04/30/2024. Staffing shortages coming out the COVID-19 waivers resulted in the inability to perform all required Subrecipient monitoring. This staffing shortage was rectified by 08/31/2023. Contact person responsible for corrective action: Loukisha Pennex, Chief of Youth and Family Potential, Anjanette Brown, CFO and Teresa Rodriguez, Senior Director of Grants and Contracts. Anticipated Completion Date: April 2024

FINDING 2023-007 Compliance Requirement(s): Non-Profit School Food Service Accounts Audit Findings: Material Weakness, Other Matters Summary of Finding: There was no documented control in place over the receipt of monthly meal reimbursements. One individual received notification of deposit, received funds into accounting software, and prepared bank reconciliations. There was no documented review of the receipt of monthly meal reimbursements by a second individual not involved in the original receipt process. Views of Responsible Officials: We Concur with this finding. Description of Corrective Action Plan: The Business Manager and Cafeteria Manager will meet monthly to review the deposit statement from the bank to verify all deposits are accurate and accounted for the Food Service Fund. The bank statement will be initialed by both parties and retained on file in the business office. Anticipated Completion Date: Immediately

FINDING 2023-006 Compliance Requirement(s): Reporting Audit Findings: Material Weakness, Other Matters Summary of Finding: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting There was no documented control in place over the review of monthly reimbursement claims. Claims were prepared and submitted by one individual without documentation that they were being reviewed by a second person not involved in the original process. The lack of controls resulted in overstatements in the number of meal counts used for reimbursement purposes when compared to School Corporation supporting documentation. Views of Responsible Officials: We Concur with this finding. Description of Corrective Action Plan: The food service director will enter the claims into CNPWeb Claim reimbursement site using the information from the Point of Sale system reports for reimbursable meals. The Business Manager will then confirm the meal counts before submitting the Claims. The FSMC food service director meets with the Superintendent monthly to review all claims and food service financials. A meeting agenda will be signed by all parties involved and retained on file in the business office. Anticipated Completion Date: Immediately

FINDING 2023-004 Compliance Requirement(s): Reporting Audit Finding(s): Material Weakness and Other Matters Summary of Finding: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements: Reporting The Unit has not separated incompatible activities within the managing of the federal award programs. The failure to establish these controls could enable material misstatements and noncompliance to be undetected. Management reviews award agreements, contracts and DOE reporting dates and requirements and submits the Annual report to IDOE. Management reviews report for accuracy between the Treasurer and Grant Manager (Asst. Superintendent). A second approval could not be verified. Segregation of duties during the process of entering, approving, and submitting the Annual Reports failed. Views of Responsible Officials: We Concur with this finding. Description of Corrective Action Plan: In the future, the Required DOE Reports will be prepared by the assistant superintendent, who oversees all grant management. Then, the Business Manager will review the prepared reports; upon review, both the business manager and the assistant superintendent will sign/initial the signifying their review of the documents. The report will also be shared with the Superintendent, who will sign off as well. Anticipated Completion Date: Effective Immediately

The  Hospital  has  identified  additional  expenditures  that  occurred  during  Period  4  to  prevent, prepare for, and respond to coronavirus that were not reimbursed by other sources or that other sources were  obligated  to  reimburse  that  were  omitted  from  the  original  submission.   In  the  future,  the  Hospital  will  maintain adequate financial records and supporting documentation for the federal awards. The tracking mechanism will include denoting if the expenditures have been reimbursed by another source or are obligated to be  reimbursed  by  other  sources.  In  addition,  the  Hospital  will  be  proactive  in  getting  necessary  training  and  education regarding the allowable uses of federal funding received in future years. Responsible Individuals: Stephani Tipton, Accountant and Ken Fisher, CFO Anticipated Completion Date: Ongoing

The Hospital has recalculated lost revenues to incorporate the audit adjusting journal  entries for the fiscal year ended July 31, 2022, for quarters impacted, incorporate the cost report settlement impact across all quarters impacted, and to include an estimated impact of the cost report settlement for quarters impacted  for  the  fiscal  year  ended  July  31,  2023.   In  addition,  the  revised  calculation  includes  the  correction  needed to remove the 340(b) drug program expenses as noted in finding 2023‐006 and to reconcile to supporting documentation  as  noted  in  finding  2023‐005.   In  the  future,  the  Hospital  will  maintain  adequate  supporting  documentation for the calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported  by  reconciling  to  the  audited  financial  statements,  internal  financial  statements,  and  other  source  documentation. The Hospital will be cognizant of items that are posted in one period that apply to multiple periods and accurately including those items in the calculation. In addition, the Hospital will be proactive in getting necessary training and education regarding the allowable uses of federal funding received in future years. Responsible Individuals: Stephani Tipton, Accountant and Ken Fisher, CFO Anticipated Completion Date: Ongoing

In  the  future,  the  Hospital  will  maintain  adequate  supporting  documentation  for  the  calculation of lost revenues and will ensure the accuracy and completeness of the amounts reported by reconciling to the audited financial statements, internal financial statements, and other source documentation. The Hospital will be cognizant of only including revenue in the calculation and that the periods being compared are calculated using  the  same  methodology.   In  addition,  the  Hospital  will  be  proactive  in  getting  necessary  training  and  education regarding the allowable uses of federal funding received in future years. The Hospital has recalculated lost  revenues  for  the  quarters  covered  by  Period  4  to  exclude  the  340(b)  drug  program  expenses  from  the  calculation, in addition to taking into consideration corrections needed for items noted in finding 2023‐007. Responsible Individuals: Stephani Tipton, Accountant and Ken Fisher, CFO Anticipated Completion Date: Ongoing

In  the  future,  the  Hospital  will  maintain  adequate  financial  records  and  supporting  documentation for federal awards. The Hospital will use a spreadsheet to track all federal awards. The spreadsheet will be prepared by the accountant and reviewed by the Chief Financial Officer. The spreadsheet will be included in the monthly financial information provided to the Board of Directors for review and approval. Responsible Individuals: Stephani Tipton, Accountant and Ken Fisher, CFO Anticipated Completion Date: Ongoing

The Hospital recognizes the importance of having a methodology in place for estimating  the allowance for contractual adjustments in accounts receivable and the estimate for third‐party payor settlements.   The  Hospital  will  work  on  strengthening  procedures  for  the  allowance  for  contractual  adjustment  estimate and develop an estimate for the Medicaid lump sum payments. Our goal will be to use our Medicare cost report model to estimate the Medicare cost report settlement on a quarterly basis. In addition, our goal is to have the model tested against the most recently submitted Medicare cost report on an annual basis. An accountant was hired on February 13, 2024, to assist the Chief Financial Officer (CFO)   in the monthly accounting duties. The accountant immediately began reconciling cash accounts and is caught up on  all  prior  month  reconciliations.   The  accountant  is  working  with  CFO  to  post  activity  and  corrections  to  the  general ledger. The accountant will ensure that cash and investment accounts are reconciled monthly in a timely manner going forward. Now that the cash reconciliations are caught up, the accountant will begin reconciling all other balance sheet accounts. Responsible Individuals: Stephani Tipton, Accountant and Ken Fisher, CFO Anticipated Completion Date: Ongoing

Finding Number: 2023-015 Federal Program: 14.218 – U.S. Department of Housing and Urban Development (HUD) – Community Development Block Grant (CDBG) – Entitlement Grants Cluster 93.563 – Title IV-D, U.S. Department of Health and Human Service - Child Support Enforcement (CSE) 10.557, U.S. Department of Agriculture – WIC Special Supplemental Nutrition Program for Women, Infants, and Children Condition Per Auditor: Controls in place were not adequate to ensure compliance with 2 CFR 200 Appendix V submission requirements for the County’s self insurance cost allocation process and annual chargeback plan. Planned Corrective Action: Management communicated with the cognizant agency which confirmed in November 2021, OMB issued guidance relating to CARES Act funding and its effect on indirect cost. Part of this guidance stated that “CARES Act funding should not be included toward the threshold amount for indirect cost submission required in 2 C.F.R. part 200, Appendix VII, paragraph D.1.b”. Therefore, County governments that met the $100 million threshold as a result of CARES Act funding are not required to submit their Central Service Cost Allocation Plan for approval. The CARES Act funding would have increased the County’s funding in excess of $100 million, which should not have been a part of the determination for the original finding. However, since CSLFRF funds were also received increasing the County’s funding in excess of $100 million the annual chargeback plans were submitted to the cognizant agency and U.S. Treasury in 2023 for implementation in FY 24 and will continue to submit subsequent plans to federal cognizant agency, as required by 2 CFR 200 Appendix V. Anticipated Completion Date: 9/30/24 Responsible Contact Person: Shauntika Bullard and Michael Bridges

Finding Number: 2023-014 Federal Program: 10.557, U.S. Department of Agriculture – WIC Special Supplemental Nutrition Program for Women, Infants, and Children Condition Per Auditor: Controls in place were not adequate to ensure the County maintained responsibility for compliance with eligibility standards when eligibility determinations are made by the contractor. Planned Corrective Action: Management has fully implemented a process, as of January 2024, by which a county representee preforms review of contractor eligibility determinations. Anticipated Completion Date: 1/31/24 Responsible Contact Person: Nataline Dean-Woods

Finding Number: 2023-013 Federal Program: 21.027, US Department of Treasury, COVID-19 – Coronavirus State and Local Fiscal Recovery Fund (CSLFRF) Condition Per Auditor: The County entered into intergovernmental agreements with local communities using the revenue loss provision of the County’s CSLFRF award. Those contracts contained subrecipient language/provisions. The County did not have adequate controls in place to ensure that the form and substance of these agreements were in compliance with the intended nature of the relationship and/or the requirements of the federal award. Planned Corrective Action: Management does not agree with this finding. As noted in the Condition of this finding itself, the agreements in question are intergovernmental agreements, clearly labeled as such. They specifically state they are funding each project with SLFRF funds under the Revenue Replacement Category (Category 6.1). Section 4.01 states “Project Funds must be used for eligible activities for revenue replacement funds as described in the SLFRF final rules, regulations, and guidance.” As Management informed the auditor before auditor edited its preliminary finding to reflect this, “as described in the SLFRF final rules, regulations, and guidance” under 6.1 there are no subrecipients by definition as the County itself is the beneficiary. The County is being "made whole" for calculated revenue loss due to the pandemic under this category; therefore, once the funds are obligated and spent by the County the purpose has been satisfied. The entity receiving those funds would not have subrecipient obligations. FAQ 13.14 confirms this understanding. The communities enter into subrecipient agreements on an annual basis with the County and are very familiar with the format of such agreements. Those agreements always state clearly that they are subrecipient agreements in the title and the introductory paragraph. The communities also enter into intergovernmental agreements with the County on an annual basis. Therefore, they are aware that these two types of agreement are distinct. In this case the agreements are clearly labeled as intergovernmental agreements in the title and the introductory paragraph and there is no mention of subrecipient status in the body of the agreement. In fact, Section 4.05, Relationship of Parties, states “Relationship of the Community to the County is, and will continue to be, that of an independent contractor.” In the subrecipient agreements the County enters into with these communities on an annual basis this clause says the relationship is that of a subrecipient. Therefore, the agreement is clear on the relationship and the communities would know to consult the County if there is any question of compliance requirements. Any language requiring compliance with provisions applicable to subrecipients was paired with the qualifier "applicable". For example Article IX requires compliance with laws only “as applicable”. This is catch-all language and is good legal practice to include for contingencies. In this case, the program being a new federal program, the County intentionally included this catch-all language referencing compliance with 2 CFR 200 (Uniform Guidance) “as applicable” and required the community to “provide any disclosures required by law.” to allow itself the ability to enforce should the laws, rules, or regulations be interpreted in a certain manner to be applicable or even changed. This is based on experience with programs such as the Neighborhood Stabilization Program through HUD where such occurrences were noted. Consequently; the County believes it would actually be irresponsible not to include such language. As far as the recommendation of increased guidance to contracted communities, given the increased guidance available now the County has provided such guidance as needed. Auditor seems to indicate that the communities “may improperly conclude they are subject to certain compliance requirements, including but not limited to incorrectly concluding they are required to report expenditures incurred under the agreements on their schedule of expenditures of federal awards, which could further lead to those communities incorrectly concluding they are subject to the requirement to obtain a single audit and/or incorrect major program determinations being made in conjunction with their single audit engagements.” The finding is essentially noting that if these communities conclude that they have a subrecipient relationship and that the Uniform Guidance is applicable to them as subrecipients it is an improper conclusion. Given the wide availability of FAQs and guidance on this topic, Management agrees it would be an improper conclusion. Anticipated Completion Date: 9/30/23 Responsible Contact Person: Haaris Ahmad