Corrective Action Plans

Finding #2022-001 ? Material Weakness Condition and context: In June of 2022, the Partnership was awarded a grant from the City of Houston to provide construction funding for an affordable housing project. The City of Houston participated in the closing for the affordable housing project on December 22, 2022, which included approving the grant payment for acquisition costs of $2,250,000. At the time of the commencement of the contract period, procedures were not in place to identify allowable acquisition costs. While allowable costs were subsequently identified for the contract period that met the definition of allowable acquisition costs under the Uniform Guidance, the Partnership nor its co-developer, who is responsible for the accounting for the development of the affordable housing, had put in place internal controls related to the submission and approval of the costs being reimbursed under the grant. Recommendation: The Partnership in coordination with the project co-developer should develop procedures for approving and identifying allowable costs. Planned corrective action: Management has adopted policies and procedures for the approval and review of all draws on the grant and the supporting documentation for allowable expenditures. Responsible officer: Michele Marvin, Vice President of Finance and Administration Estimated completion date: September 1, 2023

2022-002 Provider Relief Funds ? Assistance Listing No. 93.498 Recommendation: We recommend that management review all expenditures for direct support. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will review the policies around reporting to ensure the amounts reported are supported with directly identified expenses. Name of the contact person responsible for corrective action: Nick Harshfield, CFO Planned completion date for corrective action plan: December 2023 DocuSign Envelope ID: 6E78E0EA-0BF9-4E13-9C19-A77345D98A84

2022-001 Provider Relief Funds ? Assistance Listing No. 93.498 Recommendation: We recommend that management review all expenditures for direct support. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will review and update their policies and procedures to ensure the accuracy of reporting. Name of the contact person responsible for corrective action: Nick Harshfield, CFO Planned completion date for corrective action plan: December 2023

Finding 2022-004 Federal Agency Names: Department of Agriculture and Department of Health and Human Services Program Names: Community Facilities Loans and Grants and Covid-19 Provider Relief Fund and American Rescue Plan Rural Distribution Federal Financial Assistance Listings: 1110.766 and 1193.498 Repeat Finding: No Finding Summary: Eide Bailly LLP assisted in the preparation of our draft consolidated schedule of expenditures and federal awards and accompanying notes to the consolidated schedule of expenditures and federal awards. Status: Ongoing - Management has determined to accept the associated risk due to a cost benefit analysis of hiring additional staff. Responsibility of: Kelly VanderVorste, Administrator, and Kathy Morrow, Business Office Manager Anticipated Completion Date: Ongoing

I agree to this finding. Because of a shortfall last fiscal year into the replacement reserves due to lack of funds, HUD did allow us to transfer funds from the residual reserves back into the replacemnt reserves to make up the difference. The amount was 3406.00, the same amount that was placed into the residuals from that fiscal year, plus 594.00 from operating funds. Those totals added up to 4000.00 that we were short. That issue has been resolved and occurred on June 22, 2022. This fiscal year, we also were too short on operating funds to make the full replacement funds as required by HUD into the replacement. Management was not aware that HUD could suspend the amounts required. Now that the back subsidies have been received, management will try to get transfers caught up or request a suspension of deposits as soon as possible.

December 12, 2022 Re: FY22 CORRECTIVE ACTION PLAN AUDIT FINDINGS Federal Assistance Listing Number 21.026 Pass-Through Entity ID: HAF0174 Financial Statement Findings A. Internal Control over Financial Reporting 2022-001: Reporting of Expenditures of Federal Awards ? Material Weakness Condition: Cash received from a federal grant funded the Homeowner Assistance Fund (HAF) program, expenditures were recorded on the Statement of Net Position as a reduction in cash and a corresponding entry to unearned revenue for the year ended June 30, 2022. Management took the position that MHP was acting as contractor and therefore the program should not be presented on the Statement of Revenues, Expenses and Changes in Net Position, but rather disclosed in summary form in the footnotes to the financial statements and Management?s Discussion and Analysis. As a result of MHP?s subrecipient relationship with the Commonwealth of Massachusetts?s HAF program, an adjustment was posted subsequent to year end to reflet the gross revenue and expense from the program transactions on an accrual basis in the Statement of Revenues, Expenses and Changes in Net Position as required by generally accepted accounting principles (GAAP). CORRECTIVE ACTION PLAN: Management will report the HAF funds on a gross basis consistent with the recommendation of RSM to follow GAAP guidance. Management?s controls over financial reporting include internal consultation over the appropriate basis of presentation at the time the program was implemented. Controls also include management review of the related decision. This process for considering and concluding the appropriate basis of presentation is appropriate and will continue. MHP will strengthen its financial reporting controls to address this condition, as follows: ? Increased resources in financial reporting and operations: o New position of Director of Finance (as of 7/1/22) o New general ledger and financial reporting system currently being implemented (target date for rollover to SAGE accounting system is 4/1/23) o Review of staffing needs on the finance team currently under discussion, target date for completion by 12/31/22. When approved by senior management, the new staffing plan will be implemented in calendar year 2023 based on the needs of the team, hiring and budget priorities. ? Finance team CPA?s will focus their CPE credits on financial reporting in the upcoming year. ? MHP will document its accounting and financial presentation for new programs and request audit consideration of the financial presentation conclusions at the time interim audit procedures are completed. CONTACT PERSONS: Charleen Tyson, Chief Financial and Administrative Officer Karen English, Director of Finance Massachusetts Housing Partnership Fund Board Charleen Tyson Chief Financial & Administrative Officer

2022-005 Housing Choice Voucher Cluster ? Assistance Listing No. 14.871 and 14.879 Recommendation: We recommend that the Authority review its system of internal control related to the policies and procedures in place to mitigate the risk of noncompliance with the requirements of the stated criteria. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: In order to remedy and mitigate audit findings that we have seen building over the past several years, PHA is in the process of moving from a traditional caseload model to a functional task-based model. We will be using SharePoint trackers for transparency, a QC system including running completed HUD-50058?s through an Excel QC Tool to monitor for complete and accurate files, and using software deficiency reports and HUD SEMAP reports to monitor program compliance. Name of the contact person responsible for corrective action: Deborah Madsen, Executive Director Planned completion date for corrective action plan: 12/31/2023

2022-003 Housing Choice Voucher Cluster ? Assistance Listing No. 14.871 and 14.879 Recommendation: We recommend that the Authority review its system of internal control related to the policies and procedures in place to mitigate the risk of noncompliance with the requirements of the stated criteria. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: In order to remedy and mitigate audit findings that we have seen building over the past several years, PHA is in the process of moving from a traditional caseload model to a functional task-based model. We will be using SharePoint trackers for transparency, a QC system including running completed HUD-50058?s through an Excel QC Tool to monitor for complete and accurate files, and using software deficiency reports and HUD SEMAP reports to monitor program compliance. Name of the contact person responsible for corrective action: Deborah Madsen, Executive Director Planned completion date for corrective action plan: 12/31/2023

2022-002 Housing Choice Voucher Cluster ? All Programs Recommendation: We recommend that the Authority?s management reviews the accounting information which is the best means of preventing and detecting errors and irregularities.. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: In order to remedy and mitigate audit findings that we have seen building over the past several years, PHA is in the process of moving from a traditional caseload model to a functional task-based model. We will be using SharePoint trackers for transparency, a QC system including running completed HUD-50058?s through an Excel QC Tool to monitor for complete and accurate files, and using software deficiency reports and HUD SEMAP reports to monitor program compliance. Name of the contact person responsible for corrective action: Deborah Madsen, Executive Director Planned completion date for corrective action plan: 12/31/2023

Corrective action the auditee plans to take in response to the finding: Finding ref number: 2022-001 Finding caption: The District did not have adequate internal controls for ensuring compliance with wage rate requirements Name, address, and telephone of District contact person: Barbara Cenci, Business Manager 304 S. Adams St South Bend, WA 98586 (360) 875-6041 Corrective action the auditee plans to take in response to the finding: The district acknowledges the finding and concurs with those details, however the district also would like to point out we have already corrected the issue and implemented the plan below last June, 2022. There have been no issues related to this current finding since the issuing of the previous finding, and internal controls are in place. The district has taken corrective measures to ensure compliance with the Davis-Bacon Act requirements on all contracts moving forward. Specifically, please note the following actions: 1. The district business manager, accounts payable assistant, and Superintendent have each been trained on the Davis-Bacon Act and the required federal requirements related to contracts; 2. All contracts in excess of $2,000 entered into for construction, alteration and/or repair, including painting and decorating, of a public building or public work, or building or work financed in whole or in part with federal funds, will contain the required contract provisions; 3. Contracts utilizing federal funds will be identified as such during the procurement process; 4. The superintendent, prior to approving related contracts, will ensure required contract provisions are included. Anticipated date to complete the corrective action: June 2022

2022-005 Special Education Cluster ? Assistance Listing No. 84.027 & 84.173 Recommendation: We recommend the District reviews its procedures for charging wages and benefits to federal grants to ensure all are properly supported by time and effort documentation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The District will work to ensure proper time and effort documentation is retained for all employees with wages or benefits coded to a federal program going forward. Name of the contact person responsible for corrective action: Shari Thompson Planned completion date for corrective action plan: June 30, 2023.

Reporting to the Pennsylvania Department of Aging (PDA) is required within thirty (30) days after the report month, as noted. Area Agencies on Aging (AAAs) do not report to the US Department of Health and Human Services (DHHS), although federal funds from DHHS are passed through to AAAs.

Agency Administrator and Accountant 2 will develop and implement a comprehensive procedure that clearly defines submission process to include detailed description of everything that needs submitted and a defined deadline for submission which at this time is the 10th day of the following month for monthly ERAP reports and the PHP report is the 10th day after quarter ends for submission.

Finding ref number: 2022-001 Finding caption: The District did not have adequate internal controls for ensuring compliance with wage rate requirements. Name, address, and telephone of District contact person: Ashley Petersen, Business Manager PO Box 20 Joyce, WA 98343 (360) 928-3311 ext 1005 Corrective action the auditee plans to take in response to the finding: The following corrective action has been applied to the finding below: Our audit found the District did not have adequate internal controls for ensuring compliance with federal prevailing wage rate requirements. Specifically, the District did not: ? Include the required prevailing wage rate clauses in the contracts with two contractors o The Crescent School District contract used for all public works will be updated with the appropriate language. The school is utilizing information from SAO, OSPI, WASBO, and Business Manager peers to compile a contract that complies with state and federal requirements. ? Collect weekly certified payroll reports from the contractors to confirm they paid laborers proper prevailing wages o Crescent School District will use the LNI Contractor Awards Portal for tracking all public works projects. The portal will help track all necessary documents for the project. A checklist provided by OSPI will be referenced for each project and calendar reminders will be set to follow up on weekly prevailing wage for projects as needed. In addition, more training for public works will be strongly encouraged for the Business Office. Anticipated date to complete the corrective action: ASAP

2022-003 Cash Management Material Noncompliance Cash Management Material Weakness in Internal Control over Compliance U.S. Department of Health and Human Services Passed-through the Arizona Department of Economic Security Refugee and Entrant Assistance State Administered Federal Financial Assistance Listing/CFDA #93.566; ADES18-191650; October 1, 2020 to September 30, 2021 and October 1, 2021 to September 30, 2022 Condition: Eide Bailly LLP (EB) noted that four out of four draw requests did not have adequate support for the class hours included. Management?s Response and Corrective Action Plan: ? Monthly Attendance Report are completed by data specialist using individual teachers? daily rosters. ? The Monthly Attendance Reports are verified by the program manager and corrected if any mistakes are identified. ? Monthly invoices are reviewed, prior to submission, with the Department Manager for additional verification and approval. ? After the student attendance has been reviewed by Program Manager and verified by the Department Manager, a review log is signed off by both the Program Manager and the Department Manager. ? Any changes to either the attendance logs or monthly student attendance will only be made with the authorization of the department manager after data has been verified, with an explanation of why that was needed. ? After the appropriate verifications have taken place, the Program Manager creates the monthly invoice, they will maintain and verify documentation for the student attendance hours reflected on the invoice. ? Management will continue to discuss and explore ways to strengthen our current internal controls, including, purchasing tracking software and/or the creation of a google form/document. ? Management will routinely review and consider any needed modifications to or implementation of new policies and procedures that would strengthen internal controls surrounding the invoicing process, record-keeping, and the management thereof. Contact Person: Jose J. Vaquera, VP of Client Services Anticipated Completion Date: May 15, 2023

FINDING 2022-001- U.S. DEPARTMENT OF HOUSING AND DEVELOPMENT- ELIGIBILITY MATERIAL WEAKNESS Federal Assistance Listing Number: 14.239 HOME Investment Partnerships Program Grant Number: Various Grant Period: Various We are implementing the following procedures to address the auditing finding 2022-001: Prior to the recent internal audit of PH3, we were still rebounding from the effects COVID 19 had on our procedures at Pinellas Hope Apartments. We went through a period of significant staff turnover which resulted in falling behind on a procedure of reviewing files on a regular basis. We have subsequently hired new staff with Property Management experience and have reviewed and corrected all the current files. We also have restarted our procedure of Monthly peer reviewed audits of files for new move-ins.

Finding Number: 2022-004 Condition: The schedule of expenditures of federal awards (SEFA) initially presented for audit was not complete and accurate. Planned Corrective Action: A new report in Workday is being created to ensure all expenditures for federal awards are included. Contact person responsible for corrective action: Laura Randall Anticipated Completion Date: 10/31/2023

Finding: 2022-003? Cash Management (repeat) Auditor Description of Condition and Effect: During our audit procedures over the District?s cash management process, we noted that one of the claim requests selected for testing did not agree to the District?s actual meal counts. As a result of this condition, the District does not have proper controls in place over its procedures for submission of claim requests. Auditor Recommendation: The District should establish procedures to ensure that the number of meals being submitted for reimbursement agrees to the actual meal counts. Corrective Action: The District implemented review and approval changes in March 2022 to correct this prior year finding. The process that the District uses currently allows for the correction of errors on meal claims before submission. Responsible Person: Shelbi Frayer, Contracted Finance Director Anticipated Completion Date: June 30, 2022

Finding: 2022-002? Budgetary Control Auditor Description of Condition and Effect: During our audit, we noted that multiple departments had material actual expenditures in excess of the amounts appropriated. As a result of this condition, the District?s general fund budget amendments were not sufficient to cover the actual expenditures. Auditor Recommendation: The District should perform a detailed analysis of actual expenditures for the general fund and each special revenue fund, at a minimum by department, throughout the year and, as it becomes known that budgeted expenditures are no longer realistic, that the Board take action to amend the budget(s) accordingly. Corrective Action: The District continues to evaluate and improve it?s budget process and will evaluate the cost benefits of more budget amendments throughout the year. Responsible Person: Shelbi Frayer, Contracted Finance Director Anticipated Completion Date: June 30, 2022

Finding: 2022-001 ? Segregation of Duties Auditor Description of Condition and Effect: During our audit, we noted the following areas in which the District should improve segregation of duties: The District does not have procedures in place to allow for an independent review of payroll registers when payroll disbursements are made and recorded in the accounting records. The District currently does not have procedures in place to allow for an independent review of manual journal entries As a result of this condition, the District is exposed to increased risk that misstatements, whether caused by error or fraud, could occur and not be detected by management on a timely basis. Auditor Recommendation: The District should evaluate its processes and procedures to ensure that a sufficient segregation of incompatible duties exists. Corrective Action: The District will implement a review and approval process for payroll; manual journal entries are entered by one employee and approved and posted by a separate employee, which allows for segregation of duties. The Business office will continue to evaluate the cost benefits of additional segregation of duty procedures on an ongoing basis. Responsible Person: Shelbi Frayer, Contracted Finance Director Anticipated Completion Date: June 30, 2022

Type of Finding: Noncompliance, material weakness Condition/Context: The District did not ensure that monies spent on equipment were properly budgeted within the grant agreement and that ADE had prior approval of equipment purchases. Action planned in response to finding: The District will establish proper internal controls over property and equipment to ensure all equipment purchases are budgeted for within the grant agreement. Planned completion date for corrective action plan: For the period ending June 30, 2023. Name of the contact person responsible for corrective action: Aaron Whittle, Business Manager

Condition/Context: The District spent $12,772 of federal funding on video conferencing, COVID-19 testing, charging stations, fire and alarm testing, palm tree trimming, ADEQ monitoring, and a printer. These expenditures were not explicitly authorized within the budget approved by the passthrough agency for the related grant. In addition, the District expended $31,500 in payroll for retention stipends that were not explicitly written into the budget approved by the passthrough agency. Lastly, for eleven of 25 general disbursements tested, an approved purchase order or requisition was not maintained to support the authorization of the purchase. Among those eleven purchases, five did not have invoices approved for payment. Action planned in response to finding: The District will establish proper internal controls over processing expenditures to ensure that only those expenditures that are allowed and approved within the budget be spent out of grant funds. Those expenditures should be approved within a purchase order and requisition and the related invoices should be approved for payment. Planned completion date for corrective action plan: For the period ending June 30, 2023.

In October 2021, the Organization created a full-time staff position whose primary responsibilities were to collect, review, and track invoices and receipts. The individual was instructed to use the Journal Ledger Spreadsheet provided by MDE. However, the spreadsheet does not include a cross-check to verify that the receipts and invoices entered into the spreadsheet have associated images or scans of receipts. The Organization will begin utilizing the My Food Program software to enter invoices and receipts to track the nonprofit food service. The software will be configured to require the upload of a photo or scan of the actual receipt or invoice in order to create the expense, thus guaranteeing that documentation of the expense exists and is appropriately maintained. This procedure will also resolve any issues with corrupted files as the reports can be generated from the cloud-based software. The Organization abruptly ceased operations in January 2022. It is our understanding that sponsored sites must prove that they expended all program funds on approved program-related expenses, but are not required to do so in the month the funds were received. In other words, sponsored sites would have had all of fiscal year 2022 to document the expenditures of all funds received in fiscal year 2022. It is reasonable to assume that sites with an excessive balance in their food service account would have been able to document appropriate expenditures if given sufficient time. The Organization is confident that the systems in place in fiscal year 2022 would have allowed the Organization to monitor the appropriate use of excessive nonprofit food service program balances in future periods; most notably through the Organization?s policies and procedures contained in the Management Plan and approved by MDE. The Organization holds future claims if the balance in the food service account exceeds a three-month average of expenditures. Monitoring forms were completed on paper during fiscal year 2022. Staff were instructed to scan and save an electronic copy of the monitoring form on the Organization?s cloud-based storage system. In some cases, staff failed to save an electronic copy and the only verification of the monitoring visit is contained in paper files that are currently in off-site storage. The Organization believes that staff adhered to the monitoring requirements, despite the documentation of those visits not being readily available. Going forward, all monitoring staff will be required to complete site visits electronically using the My Food Program software. The software will store the monitoring form electronically on the cloud, inclusive of sponsor and site staff signatures with date-time stamps. There are also comprehensive monitor tracking reports available to assist with monitoring frequency compliance. In the event of a loss of internet service, the monitors will be required to complete the visit on paper and upload a copy to the My Food Program software. The Organization agrees that the retained administrative fee should reflect the administrative fee percentage stated in the Sponsor Agreement. However, the Organization would like to note that the USDA Guidance for Management Plans & Budgets states that, ?A sponsoring organization may retain a portion of the reimbursement for costs associated with administering the CACFP. It may retain up to 15 percent of the total CACFP reimbursement received, or the actual net administrative costs incurred, whichever is less.? Further in the same document, it states, ?There is a concern that sponsoring organizations of centers may spend more on administrative costs than on food. The state agency?s review should investigate how reimbursements are disbursed and whether the food service is supported appropriately.? The Organization would like to emphasize that additional funds, in a miniscule amount, were spent on operating costs, such as food, and it did not retain additional administrative funds. The Organization?s policy in fiscal year 2022 was to track the administrative fee percentage in the claims tracking spreadsheet in lieu of referencing a signed agreement each month. This is supported by the Organization?s disbursement allocation policy, which is included in the fiscal year 2022 Management Plan and approved by MDE. In fiscal 2022, the claims staff would alter the administrative fee percentage upon the written direction of the Executive Director or Director of Operations based on their verbal or written interactions with the site. Going forward, claims staff will not be allowed to change the administrative fee percentage in the claims tracking spreadsheet unless a revised Sponsor Agreement is signed. The Site Information Form was used as a supplement to other operational information about the site. This form is not a federal requirement, nor a form provided by or required by the state agency. During fiscal year 2022, the processing time for the approval of site applications by the state agency was beyond the normal thirty business days. Therefore, sites interested in participating under the sponsorship of the Organization would often complete the Site Information Form as early as possible so that the Organization could submit the site application with MDE. Oftentimes, at the time the Site Information Form was completed, the site may not have finalized site operating times and meal times. The Organization maintained a complete record of all required site information at all times. Contact names and dates of birth of responsible individuals at the sites were documented in the Google sheet used to track information during the intake appointment. In addition, the hours of operation and licensed capacity were maintained in My Food Program software. Lastly, the sites? food preparation methods were also documented on the Google sheet with site information. Catering contracts with vended meal providers are maintained on-file as they are required to be uploaded to the state agency with the site application. Going forward, the Organization will no longer use the Site Information Form or the Google sheet to track required site information. Instead, all data to ensure that the sites are eligible to participate in the CACFP, and the information required to effectively perform subrecipient monitoring procedures, will be retained in the My Food Program software.

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, 2022. Audit period: January 1, 2022 to December 31, 2022 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 2022-001 Mortgage Insurance_Nursing Homes, Intermediate Care Facilities, Board and Care Homes and Assisted Living Facilities ? Assistance Listing No. 14.129 Recommendation: We recommend that the Project work with their Regional HUD representative to discuss the unauthorized loan to result in either approval or a plan for resolution. 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. 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, and 2) increases that occurred in 2023 after the 2022 year end. 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.

Finding 2022-002: Procurement Policy (Material Weakness) Information on the Federal Program: U.S. Department of State ALN 19.040 Criteria or Specific Requirement: 2 CFR Section 200.318 requires that the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in ?? 200.317 through 200.327. Condition: FCE does not have a formal written procurement policy that conforms to the requirements of the Uniform Guidance. As a result, no procurement files were maintained to document FCE's procurement actions. Cause: FCE has no accounting policies and procedures in place to provide guidance to management on the documentary evidence requirements in accordance with proper internal controls and the Uniform Guidance. Effect or Potential Effect: Without either a procurement policy or procurement documentation, there is a risk that FCE did not perform a proper evaluation of each potential vendor whose costs were charged to federal programs. Recommendation: FCE should develop accounting policies and procedures to provide guidance to management regarding the proper internal controls over both financial reporting and compliance with federal awards. Included in those policies and procedures should be a procurement policy that conforms to the requirements of the Uniform Guidance. Furthermore, FCE should maintain documentation in its files to provide evidence to support that it followed the procurement policy. Action Taken: FCE acknowledges the requirements of the Uniform Guidance and the non-compliance implication for Federal awards. FCE is in the process of developing and implementing a procurement policy to ensure proper competitive procedures are followed with respect to its procurements, specifically its vendors. FCE will ensure that proper documentation is maintained in its files in accordance with the policy to be implemented.