Corrective Action Plans

Condition: During testing of the IDEA flowthrough grant, it was noted that expenditures were reported in an incorrect quarter to the Illinois State Board of Education. Recommendation: The District should report expenditures to the Illinois State Board of Education in the quarter that the expenditure is incurred. Management Response: The District will continue to monitor reporting by grant coordinators to ensure accurate reporting. Anticipated Date of Completion: June 30, 2025

Finding 2024-004 Period of Performance Finding Summary: During the course of the engagement, one instance was noted of a fiscal year 2023 expenditure recorded during fiscal year 2024 and therefore not allowable under the terms of the grant. Responsible Individuals: Michelle Bethke-Kaliher, Director Corrective Action Plan: A thorough review of expenditures should be performed to ensure expenditures are being properly recorded in the appropriate grant periods. Anticipated Completion Date: June 30, 2025

Finding 2024-003 Planned corrective action: The Housing Agency has limited funds for additional staff hires. Internal controls will be implemented by building them into what the Board reviews monthly. This will provide additional oversight and aid in elimination of errors. Estimated completion date: The HA’s plan is to have this corrected at 2025’s audit. A new checklist of items for monthly Board review will be established within 30 days and followed.

This finding is due to the Village not having control procedures in place to submit the annual Project and Expenditure Report for the reporting period ended March 31, 2024, accurately or within 30 days of the close of the reporting period. In the future, the Village will have controls in place to ensure accurate and timely filing of the report. The person responsible for the corrective action is the Village Manager. The anticipated completion date of the corrective action plan is before the end of the 2025 fiscal year. The plan for adherence is the Council will build a timeline for preparation and completion of the report to ensure timely and accurate filing.

Finding 2023-001 – Special Education Cluster – AL No.’s 84.027 & 84.173 Department of Education Massachusetts Department of Elementary and Secondary Education Noncompliance and Significant Deficiency Related to Internal Control over Compliance of the Major Programs Criteria: The Period of Availability for the SPED PL 94-142 Grant was September 22, 2022 through September 30, 2024. Condition: During our test of controls over compliance it was noted that there are expenditures charged to the SPED PL 94-142 Grant (September 22, 2022 through September 30, 2024) for services outside of the period of performance as set forth by the Massachusetts Department of Elementary and Secondary Education. Context: During our test of expenditures and review of the general ledger against the SPED PL 94-142 Grant as it is related to compliance it was noted that 8 expenditures charged to the grant had service periods that were completely or partially for services prior to the grant start date of September 22, 2022 and thus would be outside the period of performance and thus would not be allowable costs. Effect: The School Department was not in compliance with the period of performance requirement as set forth by the Massachusetts Department of Elementary and Secondary Education. Questioned Costs: Questioned costs for the expenditures charged to the grant whose service period was completely or partially for services prior to the grant start date of September 22, 2022 was $31,948.58. Cause: A journal entry to charge costs to the grant included invoices that were outside of the grant award start. Recommendation: We recommend the School Department follow procedures to ensure that expenditures charged to the grant are within the period of performance as set forth by the Massachusetts Department of Elementary and Secondary Education. Responsible for Corrective Plan: Kathleen Grant Estimated Completion Date: Immediately Action Taken: Updated our procedures to ensure that expenditures charged to grants are within the period of performance as set forth by the Massachusetts Department of Elementary and Secondary Education.

Reporting The College partially agrees with the finding. While the College disagrees with the auditors’ conclusions regarding the calculation of cost of attendance and Pell award amounts for the students tested, the College acknowledges the need to strengthen its review and documentation procedures over origination records and COD submissions to ensure consistency and completeness of reporting records.

Response: Management concurs with the finding. Corrective Action Plan: NewSpace Nexus will comply with federal employment eligibility requirements by ensuring a Form I-9 is completed for every employee within three business days of their start date. Employees must provide acceptable documentation as required, and completed forms will be securely maintained and retained for the required period. The Financial Analyst will periodically review personnel files to confirm compliance, and any missing or incomplete forms will be addressed promptly with documentation of corrective actions retained. Designation of Employee Position Responsible for Meeting Deadline: Financial Analyst by: January 31st, 2024

Finding Reference Number: 2023-009 Description of Finding: Utility assistance was provided to an applicant that included costs incurred prior to the period of performance. Response/Corrective Action: The County outsourced the administration of the Emergency Rental Assistance Program to several third parties over the duration of the Federally-funded program, and the third party inadvertently approved assistance payment that included amounts prior to the effective period of qualifying expenditures. For any future programs outsources for administration, the County will ensure the third parties clearly understand all program guidelines and requirements that must be maintained, and will assign County staff to oversee the programs to ensure material compliance with the contract guidelines.

The County will engage in competent consulting services to advise prior to audit findings of any deficiencies in the County's policies, procedures or recording keeping required of the federal funds.

Adopt procedures to ensure program expenditures are reported accurately.

Name of Contact Person Lillian Harrison, Executive Director Management’s Response/Corrective Action The Organization will develop and implement formal written policies and procedures to strengthen internal controls over monitoring the period of performance for all federal awards. In addition, management will provide training to relevant staff on federal grant compliance requirements related to allowable costs and period of performance to ensure expenditures are incurred within the authorized timeframe.

Summary of Findings Testing identified one expenditure out of seven sampled (14.3%) totaling $3,300 that was not recorded in the proper fiscal year. This was determined to be an instance of noncompliance in internal control over compliance related to Period of Performance requirements. The finding is not considered a repeated finding. Statement of Concurrence or Nonconcurrence MNADV concurs with the finding and recommendation labeled 2023-008. The organization failed to accurately review an expenditure that was billed in the audited fiscal year but was actually a prepay for services in the following fiscal year. The expenditure did appropriately fall within the correct grant award period as the grant spanned both fiscal years. This oversight was due to human error. Corrective Action A. Immediate Corrective Action Taken 1.Management reviewed the transaction in question and verified the correct period of performance. 2.The expenditure was reclassified to the appropriate fiscal year. 3.A review of expenditures recorded near the fiscal year-end for all federal awards was conducted to identify any additional cutoff errors. 4.Supporting documentation for corrections was retained. Completion Date: Completed prior to issuance of audited financial statements. B. Long-Term Corrective Actions The organization will implement enhanced year-end closing procedures that will include review of all invoices for the period of service to ensure that expenditures recorded near the start or end of a fiscal year are aligned with the proper fiscal year. Prepaid service expenditures will be recorded as accruals. Responsible Party: Executive Director and Contractual Bookkeeper Implementation Date: Beginning current fiscal year-end and ongoing.

FINDING 2023-003 Finding Subject: COVID-19 Emergency Rental Assistance Program - Period of Performance Contact Person Responsible for Corrective Action: Timothy A. Brown Contact Phone Number and Email Address: 219-755-3225 brownta@lakecountyin.org Views of Responsible Officials: We concur with the finding with reservations on a portion of the Finding. Description of Corrective Action Plan: \ This program is completed and the period of performance is over therefore there is not a need to formally adopt any Corrective Action Plan. The Subrecipient Contractor that administered the program has agreed that this finding was due to their internal error in submitting administration invoices too late to be properly processed and approved by the County. They will be reimbursing the ERA1 fund for the error in the amount of $154,812.56 that will be sent back to the US Treasury. Reservation: The US Treasury required the local grant recipient to prosecute ERA1 fraud activities. There were two fraud cases that were prosecuted by our local attorney. His fees were then deducted from the ERA1 fund as administration costs. The grant recipient should not be penalized for doing as directed to prosecute fraud cases without being able to pay for the services rendered. We do not control the timelines of the local courts nor the responses/actions of the defendants delaying the actions beyond the Period of Performance. Anticipated Completion Date: None, no corrective action plan is necessary.

Corrective Action Plan Action Item Responsible Party Monitoring Require that federal grant expenditures be tracked by program and period of performance to ensure costs are incurred within approved timeframes. CFO / Grants Accounting Monthly review Maintain supporting documentation to substantiate the timing of costs incurred and the liquidation of obligations in accordance with federal requirements. CFO / Accounting Staff Periodic internal review Reconcile grant expense records to the SEFA to ensure a complete and reliable population for compliance testing. CFO Documented reconciliation In FY 2026, management developed and implemented a formal Records Retention Policy to ensure that accounting records, supporting documentation, and organizational records are properly maintained and retained in accordance with applicable regulatory and audit requirements. CFO Management oversight Implement supervisory review of grant expenditures to confirm compliance with performance requirements. CFO / Board Finance Committee Quarterly review ________________________________________ Management Response Management notes that no additional federal grants, other than the HRSA Section 330 program grant (Assistance Listing 93.224), were received in FY2025 or FY2026. Prior management did not provide a reconciled SEFA schedule for earlier reporting periods, which contributed to the documentation limitations identified during the audit. Beginning in FY2026, management has developed a detailed SEFA tracking schedule for the HRSA Section 330 grant that identifies the date federal funds were drawn down, the amount received, the related expenditures, and the corresponding disbursement dates. This schedule is maintained to improve reconciliation between drawdowns, expenditures, and the general ledger and to ensure documentation is readily available for audit and compliance purposes. In FY2026, management implemented an updated and comprehensive set of policies and procedures designed to strengthen internal controls and promote consistent, standardized accounting and administrative practices. These updates establish clearer documentation requirements, defined responsibilities, and improved oversight to ensure compliance with applicable regulations and the safeguarding of organizational records and financial information. ________________________________________ Responsible Official: Chief Financial Officer Expected Completion Date: FY 2026

Colfax County agreed to be the fiscal agent for a collaborative project involving several state and federal agencies within NM, CO, and KS along with private corporations including BNSF and AMTRAK. Colfax County did not have the staffing or cash flow necessary to facilitate such a large project. County Manager and Financial Specialist were not trained in Railroad project management. Changes in staff within the County Manager’s Office and private corporations as well as state and federal agencies resulted in change in requirements, poor communication, and delay in reporting ultimately resulting in disruption of reimbursement to the County. Colfax County worked with NM Department of Transportation and Federal Railroad Administration to collect project status information and submit all outstanding progress reports. To date Colfax County has been successful in maintaining open communication and receiving support from NMDOT and FRA. All reporting requirements are current and reimbursement has been issued to the County.

Finding 2023-008 – Eligibility – Material Weakness in Internal Controls over Compliance and Instance of Noncompliance Low-Income Home Energy Assistance ALN# 93.568 (Repeat 2022-015) US Department of Health and Human Services Passed through Oregon Housing and Community Services Federal Grant/Contract Number: 2302ORLIEA, 2202ORLIEA Grant period – 2022 & 2023 ORCCA is aware of lack of documentation and internal control during the audit period due to various reasons, mainly short staffing and staff turnover and has been working hard to prevent such occurrences. The Finance staff (Finance Director, Accounting Manager, Program Fiscal Compliance Coordinator) have already started communicating with program directors if any such issues are observed. The Energy program has been current on the required reporting since the referenced audit period. The program is aware of the grants’ requirements now. Additionally, ORCCA plans to utilize grant tracker system with the ability to send reminders for important dates to avoid future delinquent reporting that was experienced during the audit period. The system will be utilized by the program directors as well as finance team (Finance Director, Accounting Manager, Program Fiscal Compliance Coordinator) working with grants/directors. The estimated date of completion of this process is January 31, 2026. ORCCA’s current process at the Energy program level has already improved to ensure proper documentation of eligibility. The Energy program director and staff are implementing this internal control at the program level to review the supporting documents and information and proper coding to the correct period.

Finding Number: 2023-002 Planned Corrective Action: City Auditor has confirmed the ARPA 3/31/24 and 3/31/25 Project and Expenditure Reports submitted agree to City Accounting records. Anticipated Completion Date: July 3, 2025 Responsible Contact Person: City Auditor Sherri Hess

2023 – 003: Activities Allowed and Unallowed, Allowable Costs, Period of Performance (Compliance; Internal Controls Over Compliance) (Repeat Finding: 2021-003 and 2022-003) Material Weakness – 93.U01 Title V Condition: The Organization’s general ledger did not allow for sufficient identification of transactions related to the major program, Title V. Title V expenditures were recorded through journal entries without supporting transaction-level detail. Because of this, the population of expenditures could not be tied to individual transactions, and pulling samples from this population would not provide a reasonable basis for drawing conclusions about the population tested. As a result, we were unable to select transactions for testing or perform the necessary audit procedures to assess compliance with federal requirements. Corrective Action Plan: As of October 1, 2024, the start of FY25, QuickBooks has been the only software used, and Revenue and Disbursements are being classed by Fund. General ledgers are reconciled monthly. Management is strengthening documentation and recordkeeping procedures to ensure compliance with federal record retention requirements, including improved tracking of Title V expenditures and retention of transaction-level support.

2023 – 008: Activities Allowed and Unallowed, Allowable Costs, Period of Performance (Compliance; Internal Controls Over Compliance) (Repeat Finding: 2018-006, 2019-008, 2020-008, 2021-007 and 2022-009) Significant Deficiency ALN 93.441 Indian Self Determination ALN 20.205 Highway Planning & Construction ALN 93.575 Child Care and Development Block Grant Condition: During compliance requirement testing for Activities Allowed and Unallowed, Allowable Costs and Period of Performance for the above noted major programs, the auditors selected 120 transactions for testing from each major program. The following number of transactions were not provided for review during the audit: ALN 93.441 – Indian Self Determination – 18 transactions ALN 20.205 – Highway Planning and Construction – 16 transactions ALN 93.575 – Child Care and Development Block Grant – 7 transactions Corrective Action Plan: The Finance Department will become familiar with the requirements of 2 CFR, Part §200.313(a) and establish appropriate internal control policies and procedures to ensure compliance with the requirements of Uniform Guidance and each major program. In addition, all staff will be trained on those policies and procedures, so they are familiar with the requirements. The Finance Department will not process payment for disbursements that does not contain sufficient, appropriate supporting documentation and necessary approvals. The Finance Department will implement and execute an internal audit, by pulling random vouchers packets to test for compliance mid-year. An internal audit process is being developed and personnel assigned. Forms will be developed to assist with the internal audit process to ensure a timely and consistent process will be followed.

Juel Fairbanks Chemical Dependency Services will implement changes in how we do our day-to-day process of approvals of payments authorized signature for payments prior to being issued.

Condition 1: The new FMIS includes built-in controls to monitor the period of performance, including tracking the last day for encumbrances and payments, ensuring timely and accurate financial management. Condition 2: In FY2025, all invoices with corresponding purchase orders are uploaded into the system by the Procurement & Supply Division. Once uploaded, the Accounting Division reviews and processes payments accordingly. Additionally, Accounting Management reinstated the pre- review of payment request vouchers with corresponding BRVs prior to payment issuance to strengthen controls and ensure compliance. Condition 3: A control process is currently in place whereby each Notice of Award (NOA) is assigned to a single, corresponding SPG account. Condition 4: NOAs and all relevant grant documents are required to be uploaded to Bisan at the time a new SPG account is created.

As part of the close-out process, all open purchase orders are now submitted to the Department of Finance for closure. The grant close-out process has been shifted to the OMB to ensure the grant is no longer available for transaction entries or liquidations. Additionally, a dedicated Fiscal Analyst is being integrated into the workflow to ensure compliance.

The Government concurs with the finding. OTAG enhanced grant setup, expenditure charging, and closeout controls to ensure costs are charged to the correct award and within the approved period of performance, including 90-day liquidation monitoring.

VIDE acknowledges the audit finding regarding the Child Nutrition Cluster Period of Performance and concurs with the recommendation. We recognize that while the cost was incurred during the valid period, the liquidation payment occurred 18 days past the allowable deadline. To prevent recurrence, VIDE will enforce strict protocols for grant closeout and liquidation. To achieve this, VIDE will establish an internal hard stop deadline for invoice submission, requiring that all invoices for expiring grants be submitted to the Fiscal Office no later than 45 days prior to the federal liquidation deadline to provide a necessary buffer to resolve vendor disputes and process payments before the federal cutoff. Additionally, the State Director of Special Nutrition Programs will implement a scheduled notification system to issue closeout alerts to relevant program staff and fiscal support personnel at 90, 60, and 30 days prior to the liquidation deadline, which will trigger the immediate review of open encumbrances and the expediting of pending invoices to ensure the internal hard stop deadline is met. Furthermore, for any valid expenditures remaining unpaid within 30 days of the liquidation deadline, the Fiscal Office will generate a priority payment list and transmit it to the Department of Finance with a high-priority flag to ensure these specific vouchers are processed before the grant period closes. Finally, the Federal Grants Director and the Deputy Commissioner of Fiscal and Administrative Services will review the Grant Expiration Report monthly to identify grants approaching their liquidation deadline and ensure the internal cut-off dates are being adhered to.

The City will work to ensure all reports for grant funding are completed.