Corrective Action Plans

The Board of County Commissioners will work with all County Officials to go over all grants and federal monies that the County receives to ensure that proper internal controls are implemented.

We concur with this finding and have implemented measures to mitigate the repetition or additional occurrences. We mplemented an electronic system to more efficiently collect and store expenditures and supporting documentation, eliminating a paper filing system. We updated our fiscal policies and procedures in 2022 to document a standardized process for documenting expenditures and retaining receipts. For instance, invoices cannot be processed without adequate documentation. Additionally, credit card holders are responsible for submitting electronic credit card receipts to the fiscal office monthly. In 2022, an updated credit card policy was provided to all employees. The adherence to the credit card policy is monitored by the Fiscal Office and CEO. Responsible person(s): Jemea Dorsey, CEO and Jeanetta Johnson, Fiscal Manager Anticipated Completion Date: FY 2022

In response to finding number 2021-SA2, management agrees with the finding and will design, implement, and maintain internal controls over all direct and material compliance areas (other than eligibility). Additionally, management will ensure that the Organization’s internal controls comply with the Comptroller General of the United States’s “Standards for Internal Control in the Federal Government” or COSO’s “Internal Control Integrated Framework”.

County Judge/Executive’s Response: The Breathitt County Fiscal Court has hired a new County Treasurer since the completion of the 2021 audit who will ensure stronger internal controls are maintained in her official capacity and will be working with additional staff members, such as the Finance Officer and Occupational Tax Administrator, to segregate duties in a more controlled method. The newly hired County Treasurer will work to resolve the following issues by the end of the calendar year in the following manner. Failure to perform accurate reconciliations - the new Treasurer has already begun to perform accurate reconciliations at the end of each month. Tax obligations not paid timely - the new Treasurer has already implemented a system for paying obligations by the deadline. Failure to maintain accounting records - the Former Treasurer began the process of reporting & record maintenance for the Justice Center Corporation Fund and the new Treasurer is continuing with this reporting method. This was implemented at the end of 2022. Failure to prepare financial statements timely - the new Treasurer will complete the annual statement in accordance with KRS 68.020 in a timely manner. Failure to prepare an accurate Schedule of Expenditures of Federal Awards (SEFA) - the new Treasurer will complete SEFA's accurately. Disbursements issues: o Segregation of duties is currently being reviewed and the new Treasurer is establishing a process for review and approval of disbursements that will allow for stronger internal controls. New system will be in place by the end of the calendar year. The Breathitt County Fiscal Court has also begun utilizing [software name redacted] as the primary accounting software which will allow for more consistent tracking of purchase orders and permit better tracking of obligated expenses. Supporting documentation will be kept for all transactions, including credit card transactions. Invoices will be paid in a timely manner - great strides have already been made in this area with the hiring of the new Treasurer but will continue to improve during the remainder of the calendar year 2023. The Breathitt County Fiscal Court adopted the KY Model Procurement code in August 2023. With the hiring of a new Applicant Agent in January 2023 and a new Treasurer in July 2023 proper bid documentation is already being maintained and procurement policies are being followed. An encumbrance list will be maintained by the new Treasurer. Payroll issues: o Annual pay rate lists will be maintained & approved at the first regular meeting of the Breathitt County Fiscal Court each January. New County Treasurer will ensure that payments moving forward do not exceed statutory maximums. All lump sum payments made to employees will be issued using W2's, moving forward, beginning in November 2023.

In the future, we will only use actual amounts for items that have been purchased. In addition, amounts will be reviewed against the funding guidance to make sure they are within the period of availability.

In May 2022, a new CFO was hired and new procedures put in place. Both the CFO and Accounting Manager both have reviewed eligible expenditures and loss revenue to ensure entity does indeed qualify for the full amount of funding, regardless of the information that was submitted on the respective reports.

In May 2022, a new CFO was hired and new procedures put in place. Both the CFO and Accounting Manager both have reviewed eligible expenditures and loss revenue to ensure entity does indeed qualify for the full amount of funding, regardless of the information that was submitted on the respective reports.

Finding 2021-006 Reporting - Timely Submission of Financial Reports – Material Weakness in Internal Control over Compliance and Noncompliance Name of Contact Person: James Wilson, Borough Manager Corrective Action Plan: The Borough is currently in process of catching up on audits with the goal of completing the FY 2023 audit timely. Completion Date: March 2024

Finding 2021-005 Activities Allowed and Unallowed, Allowable Costs, Period of Performance – Material Weakness in Internal Control over Compliance and Noncompliance Name of Contact Person: James Wilson, Borough Manager Corrective Action Plan: The Borough is currently undergoing an upgrade in record retention policies and procedures. Completion Date: December 2023

Title 97.036 – Disaster Grants – Public Assistance (Presidentially Declared Disasters), Officials and employees tasked with the responsibility of expending federal FEMA funds will attend training and seminars offered by OSAI, OEM, and Muskogee Creek Nation to better understand the guidelines. Information received will be communicated to the other officials at the quarterly meetings, Anticipated Completion Date 6/30/23, Responsible Contact Person Board of County Commission Chairman - James Yandell

Tile 97.036 – Disaster Grants – Public Assistance (Presidentially Declared Disasters), Planned Corrective Action Officials and employees tasked with the responsibility of expending any federal funds will attend training and to better understand the guidelines. Information received will be communicated to the other officials at the quarterly meetings, Anticipated Completion Date 6/30/23, Responsible Contact Person Board of County Commissioner Chairman - James Yandell

Deficiencies in Activities Allowed, Allowable Costs, and Period of Performance Controls over compliance with Payroll - Significant Deficiency Recommendation: The auditor recommends that the Entity implement controls for documenting and retaining information to indicate the Entity follows the requirements over 2 CFR section 200.430(i), and that alll pay rates be reviewed for approval and propriety. Action Taken: EPHCC will implement additional controls to ensure the following: 1. All employees must submit an approved timesheet or time and effort for each pay period. 2. All payroll transactions for staff from staffing agencies need to be reviewed by the accounting manager to ensure invoice has correct rate and that staff is paid for all hours worked on timesheet. 3. Upon hiring staff from staffing agencies, EPHCC shall document and retain information that all pay rates are reviewed byt the CEO for approval and propriety. Responsible Official: Chief Financial Officer, Lizabeth Romero Timeline for Implementation: Effective by May 2023

Finding Reference Number: MW2020-009 Statement of Concurrence or Nonconcurrence: CUAHSI agrees with the finding and recommendation. CUAHSI Corrective Action: Action by CUAHSI impacting audit year 2020: CUAHSI uses a single payment gateway for registration on CUAHSI events and was able to accurately document and produce grant-specific totals for audit year 2020 program income. Corrective actions to processes and responsibilities impacting subsequent years: CUAHSI uses a single payment gateway to segregate payments appropriately per event and per grant. Program income for subsequent years has been reported to NSF annually and appropriate staff and policies are in place to ensure future compliance. Name of Contact Person: 􀁸 Maureen S. Ako, Director of Finance 􀁸 Telephone: (339)221-5400 􀁸 Email: msabino@cuahsi.org Projected Completion Date: NA; is complete

Statement of Concurrence or Nonconcurrence: CUAHSI agrees with the finding and recommendation. CUAHSI Corrective Action: Action by CUAHSI impacting audit year 2020: CUAHSI uses a single payment gateway for registration on CUAHSI events and was able to accurately document and produce grant-specific totals for audit year 2020 program income. Corrective actions to processes and responsibilities impacting subsequent years: CUAHSI uses a single payment gateway to segregate payments appropriately per event and per grant. Program income for subsequent years has been reported to NSF annually and appropriate staff and policies are in place to ensure future compliance. Name of Contact Person: 􀁸 Maureen S. Ako, Director of Finance 􀁸 Telephone: (339)221-5400 􀁸 Email: msabino@cuahsi.org Projected Completion Date: NA; is complete

2020 ‐ 001: Material Weaknesses in Internal Controls over Compliance— Activities Allowed and Allowable Costs for Non-payroll expenses, Period of Performance, Reporting, and Special Test and Provisions. Compliance requirement Corrective Action Activities Allowed/Allowable Costs and Period of Performance Microsoft D365 was implemented in 2022 as the ERP system for Dairyland Power. Microsoft D365 will allow for project tracking ensuring appropriate approval workflows specific to federal assistance programs. Workflows will be set to ensure costs are routed to personnel who have authority to approve and also have knowledge of cost allowability as stipulated by the federal award. The system also supports historical data requirements by allowing retention of documents withing the system at the transaction level. The use of the Microsoft D365 ERP will ensure the evidence of approval for non-payroll expenses would be appropriately logged and retained within the system. This corrective action is currently in place. Reporting and Special Test and Provision Dairyland Power has recently established Grant Policies to ensure that internal processes are managed in compliance with federal awards. An Allowable Cost Policy was created to clearly define roles and responsibilities for the management of federal awards and also identifies the review and approval process of reimbursement requests/reports. A multi-layer approval process for the approval of reimbursement exists. The Project manager, in coordination with the Grant Specialist and the Compliance Team, will review federal project costs and prepare reimbursement reports per the instructions. The reimbursement request/report will then be submitted to the Grant Manager, who will review the reimbursement request/report for cost allowability and completeness. Upon approval from the Grant Manager, the reimbursement request will be forwarded to the Treasury Manager who will review, approve, and submit the request through the proper submission channel by the deadline. Evidence of review will be saved for documentation purposes. Dairyland Management will conduct an annual review of the established Grant Policies or reassess them when necessary. Employees at Dairyland who participate in the federal award process will be provided with training on the Grant Policies. This corrective action is currently in place. In addition to the above corrective action, Dairyland Power has also engaged an external audit service to conduct a review of the design and operating effectiveness of Dairyland’s grant process internal controls. The purpose is to provide Dairyland with a comprehensive assessment of the existing Dairyland internal control processes and policies related to federal awards. Expected completion of this audit is January 2025. Anticipated Completion Date — January 2025 Responsible Party — Tim Lightfoot, Controller

Finding 2020-003: Reconciliation of Accounts Federal Program: Research and Development Cluster (Education and Human Resources) Assistance Listing Number and Title: 47.076 STEM Education Name of Federal Agency, Pass Through Entity (when applicable), Award Number and Year: National Science Foundation: 1812860 (9/1/2018 – 8/31/2020), 1940925 (1/15/2020 – 12/31/2023) Condition: The year-end schedules for federal grants receivable, for net assets, and for vacation payable were not reconciled and needed to be revised and updated. Views of Responsible Officials and Planned Corrective Actions: The outstanding liability due to NSF of $73,057 will be reimbursed when AAPT files the next drawn down request. Anticipated date of drawn down will be by April, 30,2024 The remaining balance was earned in 2021. The senior accountant will be trained to prepare entries previously prepared by the CFO The senior accountant will reconcile accounts, and provide updated current schedules. The CFO will review and approve the entries and schedules prepared by the Senior accountant. Anticipated Completion Date: October 15, 2024 Responsible Official: Michael Brosnan, CFO

Finding 2020-006: Subrecipient Monitoring Federal Program: Research and Development Cluster (Education and Human Resources) Assistance Listing Number and Title: 47.076 STEM Education Name of Federal Agency, Pass Through Entity (when applicable), Award Number and Year: National Science Foundation: 1640791 (9/15/2016 – 8/31/2022)Cause: AAPT's internal policies and procedures governing risk assessment on subrecipient was not performed. Views of Responsible Officials and Planned Corrective Actions: Management will continue to perform risk assessment procedures and will thoroughly document the processes and evaluations. Anticipated Completion Date: 12/31/2022 Responsible Official: Michael Brosnan CFO

Hyde Leadership Charter School – Brooklyn will implement procedures to track and manage expenditures reimbursable by federal awards. The accounting system will be updated to track and capture federal expenditures separately from general expenditures. Management and Hyde Leadership Charter School – Brooklyn’s financial service provider will review federal expenses incurred prior to submitting for reimbursement.

Management acknowledges the findings and has implemented a corrective action plan to enhance compliance with Federal awards. This plan includes developing Standard Operating Procedures (SOPs) for grant management activities, identifying and documenting existing internal controls, and maintaining constant communication with stakeholders to prevent material non-compliance. Additionally, PREPA will provide training to staff on the new SOPs and establish a monitoring mechanism to continuously assess and improve the effectiveness of these controls. The corrective action plan, supervised by Mr. Ezequiel Nieves from the PREPA Disaster Funding Management Office, is expected to be completed by July 2025. Management is committed to addressing deficiencies, ensuring that processes and controls are robust and effective, and that Federal awards are managed transparently and in full compliance with all regulatory requirements. Effective June 1, 2021, the Authority transitioned the management and operation of its transmission and distribution network as well as certain back- office functions, including billing, collections and accounting, to a third party. The third-party operator is reviewing operating procedures and controls within its responsibilities to make the necessary improvements. Management will work to address these findings with the assistance of the third-party operators, where applicable. Also, effective July 1, 2023, the Authority transitioned the management and operation of its generation assets as well as certain back- office functions to a third party. The third-party operator is reviewing operating procedures and controls within its responsibilities to make the necessary improvements. In addition, the Authority will also be implementing and monitoring corrective actions taken by the new generation segment operator. Mr. Ezequiel Nieves - PREPA Disaster Funding Management Office July 2025

Finding 2020-006: Subrecipient Monitoring Federal Programs: Research and Development Cluster: Stem +C Cause: AAPT's internal policies and procedures governing risk assessment on subrecipient was not performed. Views of Responsible Officials and Planned Corrective Actions: Management will continue to perform risk assessment procedures and will thoroughly document the processes and evaluations. Anticipated Completion Date: December 17, 2021 Responsible Official: Michael Brosnan CFO

During the audit period through 2022, there was a transition of fiscal and administrative personnel at the City of Williamsport. Due to findings of an internal financial investigation, the City communicated with appropriate parties and a grand jury was convened. The City has been an continues to be under state and federal criminal investigations since February of 2020. Numerous financial records, extending over a 10-year period, have been provided to investigators. In June of 2022, the City hired a consultant to provide fiscal oversight on an ongoing basis and reconcile, to the extent possible prior financial records. Since that time, the City has enhanced internal control and implemented policies to assure accurate financial reporting and compliance. The City anticipates a similar finding for the December 31, 2021, and 2022 audits, but with the exception of the results of the criminal investigations, expects to resolve this finding for the December 31, 2023 audit.

Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding No Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and fall within the period of performance • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that it is within the grant period • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system • Conduct regular review of expenditures to ensure compliance with the grant period and maintain audit trail • Review these procedures annually to ensure the ongoing compliance with the grant’s period of performance

Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding No Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and fall within the period of performance • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that it is within the grant period • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system • Conduct regular review of expenditures to ensure compliance with the grant period and maintain audit trail • Review these procedures annually to ensure the ongoing compliance with the grant’s period of performance

2020-108 Lack of Controls over Costs Submitted for Reimbursement Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Corrective Action Planned: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation. Person Responsible for Corrective Action: Robert Thompson, Chief Operating Officer Anticipated Completion Date: March 1, 2023

2020-107 Lack of ACH Payment Review and Approval Condition: Payments are not reviewed prior to ACH payments. The Organization has no documented policies and procedures for handling the processing and review of ACH payments. Corrective Action Planned: : The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation. Person Responsible for Corrective Action: Robert Thompson, Chief Operating Officer Anticipated Completion Date: March 1, 2023