Corrective Action Plans

Solvista Health management agrees with the auditor’s finding. In conjunction with the shared services agreement, the Group will design and implement a system of internal controls which includes a review process to ensure accurate use of approved fringe benefit rates in all federal reporting. The Group will reconcile budgeted and actual fringe benefit costs regularly to ensure continued compliance.

Finding: 2024-037 - A review of 16 FY 24 Disaster Grants program subrecipients’ obligating award documents found seven did not include all federally required information and one was also missing a completed assurances and agreement form. Questioned Costs: None Assistance Listing Number: 97.036 Assistance Listing Title: Disaster Grants Public Assistance (Presidentially Declared Disasters) Views of Responsible Officials (state whether your agency agrees or disagrees with the finding; if you disagree, briefly explain why): DMVA concurs with the finding. Corrective Action (corrective action planned): OAD, Assurance, and Agreement Forms: The Finance Officer in coordination with the Homeland Security Director will conduct a thorough review of the OAD, assurance, and agreement forms to comply with 2 CFR 200.332. Necessary updates to the pertinent forms will be made to reflect federal requirements and clearly identify the funding is a subaward to the subreceipient. Revision of Internal Procedures: The Finance Officer will revise and document internal procedures to ensure that: • Employees and contract support consistently validate the information contained in sam.gov against data provided by subrecipients • When applicable Homeland Security employees will review, validate, and certify work completed by a contractor prior to the issuance of a subaward Completion Date (list anticipated completion date): October 31, 2025 Agency Contact (name of person responsible for corrective action): Bryan Fisher

Finding: 2024-083 - One of 40 sampled transactions were coded incorrectly to the wrong grant. Questioned Costs: None Assistance Listing Number: 47.076 Assistance Listing Title: RDC Views of Responsible Officials (state whether your agency agrees or disagrees with the finding; if you disagree, briefly explain why): There is no disagreement with the audit finding. Corrective Action (corrective action planned): The expenditure with issue was charged to a ‘Closed’ grant and UAF Office of Grants & Contracts Administration (OGCA) was not aware of this until it showed up on the aged receivable report so it was not corrected in time before year-end. OGCA will develop a plan to detect and correct these inappropriate expenditures charged on closed grants timely. Completion Date (list anticipated completion date): June 2025 Agency Contact (name of person responsible for corrective action): Michelle Bunch, Office of Grants and Contracts Associate Director, 907-474-6173

Finding: 2024-035 -Six of seven award extensions for the NGMOMP program were untimely. Additionally, one award was not closed timely. Questioned Costs: None Assistance Listing Number: 12.401 Assistance Listing Title: NGMOMP Views of Responsible Officials (state whether your agency agrees or disagrees with the finding if you disagree, briefly explain why): DMVA concurs with the finding. Corrective Action (corrective action planned): Administrative Services has consistently provided notification and set clear deadlines to the Federal and State Program Managers of an expiring award under the Cooperative Agreement (CA). This notification has included a financial report detailing posted expenses and open obligations and when applicable, a copy of the most resent approved extension for reference. Due to inconsistent and untimely responses, the Finance officer in conjunction with the Administrative Services Director will update and strengthen written procedures, elevating responsibility for follow-up when responses are not received to ensure timely submission of extension requests and award closeouts following 2 CFR 200.303(a), 2 CFR 200.308(e), and 2 CFR 200.344. Updated documented procedures and training will be provided to the components under the CA. Completion Date (list anticipated completion date): 06/30/2025 Agency Contact (name of person responsible for corrective action): Bob Ernisse Pamela Wiederspohn

Finding 2024-002 – Activities Allowed/Unallowed, Costs Principles and Period of Performance (Internal Controls Over Compliance) (Repeat Finding 2023-001) Condition: During our review of the Coalition’s disbursements related to the Title V major program, we examined 68 transactions for internal controls over compliance. 7 of the 68 transactions examined did not contain sufficient evidence that a review and approval process was completed prior to payment being processed. Corrective Action Plan: In response to the finding regarding insufficient internal controls over compliance for disbursements related to the Title V major program, the Nebraska Urban Indian Health Coalition (NUIHC) has previously taken several corrective actions to strengthen compliance, including: 1. Review and Revision of Policies and Procedures: NUIHC conducted a comprehensive review of internal control policies and procedures related to disbursements. Updates were made to ensure alignment with 2 CFR §200.313(a), and clear guidelines for review and approval processes were established. 2. Staff Training and Education: Training was provided to procurement and finance staff to ensure understanding of the revised procedures and federal compliance requirements, emphasizing the importance of proper approvals prior to disbursement. 3. Implementation of Standardized Approval Controls: A formal approval process and checklist system were implemented to ensure all disbursements are reviewed and approved by designated authorities before payment, with documentation retained for compliance. 4. Ongoing Monitoring and Internal Reviews: NUIHC began conducting quarterly internal compliance checks to verify adherence to updated procedures. Update and Continuation Plan: While these corrective actions were successfully implemented, the retirement of the former CEO temporarily stalled consistent oversight and reinforcement of these procedures. With new leadership in place, NUIHC is recommitting to the continued execution and monitoring of these corrective actions. Refresher training will be incorporated into ongoing professional development and onboarding for new staff, and quarterly internal audits will resume as scheduled. Timeline for Implementation: Corrective actions were initially implemented in 2024, and reinforcement activities—including staff refreshers and compliance monitoring—will continue a rolling basis starting July 2025. Responsible Party: Chief Financial Officer, Carlett Gregory Anticipated Completion Date: Ongoing; reinforcement begins July 2025

Finding Reference Number: 2024-001 Description of Finding: Expenditures totaling $273,298 were incorrectly charged to the 93.464 program for a fiscal year in which the costs were not actually incurred. This misclassification resulted from recording expenses based on the purchase order date (September 30) rather than the actual service date, leading to overbilling for the grant year. Statement of Concurrence or Nonconcurrence: We concur with the audit finding regarding the misclassification of expenditures totaling $273,298 to the 93.464 program after the fiscal year-end. We acknowledge that these costs were recorded in the incorrect accounting period, resulting in an overstatement of grant expenditures for the fiscal year. Corrective Action: 1. Policy Update: CFILC will revise expense recognition policies to require that costs be recorded in the period matching the actual service date. 2. Year-End Review Process: CFILC will implement a formal review process at fiscal year-end to confirm expenses are attributed to the correct fiscal year. 3. Staff Training: CFILC will provide training for financial reporting and grant billing staff on the expense recognition policy and year-end review process. 4. Monitoring & Compliance: CFILC will establish periodic internal audits or reviews to ensure ongoing compliance with the updated procedures. 5. Finance Committee Oversight: Executive Director will report to the Finance Committee on the status of this corrective action plan by the completion date of December 31, 2025. Name of Contact Person: Kathrine Crowley, Acting Executive Director, kathrine@cfilc.org, (916) 232-1985 Projected Completion Date: December 31, 2025

2. Finding 2024-002 Section 1A of the grant agreement requires that the Credit Union expend its CDFI ERP Award in eligible activities including providing financial products in low-or moderate-income majority minority census tracts that are also ERP-Eligible geographies. a. Action(s) Taken or Planned on the Finding Management agrees with the finding and has established procedures to identify eligible loans deployed in the eligible ERP-Eligible geographies. These loans will be reconciled to the underlying loan servicing systems. b. Implementation Date: Procedures were developed and implemented in June 2025.

Condition: The county did not update their federal policies and procedures to be in full compliance with Uniform Guidance. Corrective Action Plan: The county f ill adopt needed policies per Uniform Guidance Responsible Official: Austin Hazelti,re, County Coordinator Expected Date of Completion: Dec mber 31, 2025

Finding Number: 2024-001 Condition: The City lacked adequate controls to verify that expenditures charged to the grant were incurred within the proper period of performance. Transactions were processed without sufficient review or procedures around the period of performance, resulting in expenditures being charged from outside the allowable timeframe. Planned Corrective Action: The City has worked with the State to identify expenses outside the period of performance. The City has sent the money back to the State that was before the performance start date. All balances are properly stated as of November 30. 2024. Contact person responsible for corrective action: Connie Kumpula Anticipated Completion Date: 5/23/2025

Finding 2024-056 Disaster Grants - Public Assistance (Presidentially Declared Disasters), ALN 97.036 - EM Grants Manager Security Management and Access Controls Management Views MSP agrees with the finding. MSP implemented the EM Grants Manager system in November 2023 and did not fully establish procedures for maintaining documentation of user access forms, reviewing privileged access, and disabling inactive users due to the number of current disasters and limited staff. Planned Corrective Action For part a., MSP implemented an access approval process in November 2023 to maintain documentation of access request forms within the EM Grants Manager system. For parts b. and c., MSP will create procedures to help ensure the timely completion of privileged user reviews and inactive user deactivation. MSP will perform the required user reviews and deactivate applicable accounts by September 30, 2025. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Penny Burger, MSP

Finding 2024-049 Refugee and Entrant Assistance State/Replacement Designee Administered Programs, ALN 93.566 - Salesforce Security Management and Access Controls Management Views LEO agrees with the finding. Planned Corrective Action The LEO Office of Global Michigan (OGM) will improve established procedures and tracking logs to help ensure compliance with SOM Technical Standard 1340.00.020.01 (Access Control Standard). Specifically, LEO OGM will review user access semiannually for privileged accounts and annually for all other accounts. Also, LEO-IC is in the process of establishing a compliance team that will perform validation of the ongoing reviews. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Ben Cabinaw, LEO Allen Williams, LEO

Finding 2024-025 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027 - Insufficient Respite Payment Controls Management Views MDHHS agrees with the finding. Planned Corrective Action During fiscal year 2024, MDHHS improved the payment review process prior to manual input into the Medical Services Administration Manual Payment System (MSAPay) to help ensure there are no improper payments, as demonstrated by no improper payments identified for fiscal year 2024. MDHHS will develop and implement a post payment review process for the final respite payments that were entered into MSAPay during December 2024 and anticipates completion by September 30, 2025. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Crystal Kline, MDHHS Jessica Bowen, MDHHS Elaina Brown, MDHHS

Finding 2024-024 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027 - Grant Reimbursement Approval Procedures Management Views EGLE agrees with the finding. Planned Corrective Action The EGLE Water Resources Division’s (WRD) administration staff adjusted their review process in April 2024 to comply with overall EGLE guidance that all reimbursement requests should be reviewed by a program representative and financial representative to ensure payments are made for activities authorized by the grant agreement. However, WRD had not fully completed the retroactive review of payments for fiscal year 2024. This has since been corrected and all retroactive reviews to ensure compliance with program technical specifications were completed as of May 1, 2025. Anticipated Completion Date Completed Responsible Individual(s) Phil Argiroff, EGLE Amy Hicks, EGLE

Finding 2024-023 Coronavirus State and Local Fiscal Recovery Funds, ALN 21.027 - PTMS Security Management and Access Controls Management Views MDOT agrees with the finding. Planned Corrective Action MDOT EIM and Office of Passenger Transportation will collaborate and provide oversight to ensure that Public Transportation Management System (PTMS) user access is reviewed semiannually for privileged accounts and annually for all other accounts. MDOT will implement an improved process which will include obtaining, verifying, and documenting the written approval for all identified users by the designated System Security Administrators. Access will be modified/removed, as appropriate, based on responses or removed for non-responders prior to the end of each six-month period for privileged users and each fiscal year for all other users. Anticipated Completion Date September 30, 2025 Responsible Individual(s) Sandy Lovell, MDOT Gina Huhn, MDOT Jean Ruestman, MDOT Kyle Nelson, MDOT Andy Esch, MDOT

Finding 2024-021 National Guard Military Operations and Maintenance (O&M) Projects, ALN 12.401 - Extension Procedures Management Views DMVA agrees with the finding. Planned Corrective Action DMVA will set annual recurring calendar appointments to review program activities with the program managers one month before the end of the period of performance to ensure a joint understanding of extension requirements, allowing sufficient time to prepare and submit period of performance extension requests timely, if needed. Anticipated Completion Date September 1, 2025 Responsible Individual(s) Rachelle Breeden, DMVA

Finding 2024-002 Federal Agency Name: Department of Housing and Urban Development Pass‐Through Entity: Passed through Hearth Connections and Passed through Dakota County, Continuum of Care. Assistance Listing Number: Federal Financial Assistance Listing #14.267 Program Name: Continuum of Care Program Finding Summary: Guild’s controls did not operate as designed, which resulted in rent reasonableness tests not being performed timely and/or reviewed before the rent being paid. Corrective Action Plan: This clinical program is now under new leadership and is enhancing its controls and oversight. In addition to requiring a monthly rent checklist to be reviewed and signed off by the responsible official, an additional layer of control will be implemented by involving Finance in verifying that proper documentation is in place before rent checks are issued. The program, in collaboration with Finance, will also continue enhancing the approach to standardized documentation. Responsible Individuals: Keith Rachey - Chief Financial Officer, Tiffany Yang – Controller, Diana Harris – Director of Clinical Services Anticipated Completion Date: Completed by September 2025

Finding 2024-001 – Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Period of Performance Federal Grantor: United States Department of Homeland Security Assistance Listing No.: Assistance Listing 97.036, COVID-19 Disaster Grants – Public Assistance (Presidentially Declared Disasters) (FEMA) Pass-Through Grantor: Indiana Department of Homeland Security Federal Award Period of Performance: March 1, 2020 – May 11, 2023 A material weakness was identified related to internal controls over payroll expenses charged to FEMA funds, subject to the Uniform Guidance (UG) audit. This guidance requires internal controls to comply with the terms of the federal award as well as with the "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 COSO. The finding was a compliance matter and did not result in any questioned costs. Community Foundation of Northwest Indiana, Inc. and Subsidiaries (CFNI) acknowledges the finding related to the lack of documented review and approval of all timecards for payroll expenses charged to federally funded programs. In line with industry standards, CFNI prioritizes timely payroll processing and does not delay payroll for outstanding timecard approvals. While this is not a recurring issue and did not result in any questioned costs, CFNI recognizes the importance of ensuring compliance with all federal requirements. To address this finding and prevent recurrence, CFNI is implementing a comprehensive policy that mandates timely review and approval of all timecards associated with payroll expenses charged to federal grants. Additionally, CFNI is establishing a formal process to monitor adherence to this policy, including regular audits and detailed documentation of the review process. CFNI is committed to strengthening internal controls, improving oversight, and ensuring full compliance with federal grant requirements. Responsible Official: Pamela Pokropinski, VP Finance Status of finding: Completion expected June 2025

Finding 2024-004 Federal Agency Name: Department of Health and Human Services Program Name: Rural Health Care Services Outreach, Rural Health Network Development and Small Health Care Provider Quality Improvement Federal Financial Assistance Listing #93.912 Compliance Requirement: Activities Allowed or Unallowed and Allowable Costs/Costs Principles and Period of Performance Finding Summary: Some expenditures were not fully supported by underlying documentation. In addition, some of the expenditures tested did not have documentation of the review and approval of the allocation of the expenditure to the federal program. The Clinic also calculated their indirect cost rate based on the total grant budget and claimed an equal amount of indirect costs per month instead of calculating the indirect cost rate per direct expenditures for each month. Responsible Individuals: Kayla Trent, Finance Director Corrective Action Plan: Management agrees with the finding and has reviewed the operating procedures of Robert C. Byrd Clinic. Furthermore, we have implemented procedures to retain expenditure listings and other support for federal awards as well as the related review. The Clinic began retaining expense reconciliations for all Grants. Anticipated Completion Date: July 1, 2024

Block Grants for Prevention and Treatment of Substance Abuse – Assistance Listing No. 93.959 Recommendation: We recommend the County to conduct training with its various departments to instruct them on how to compile expenditures based on the accrual basis of accounting (when the expenditures were incurred). Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Auditor’s Controllers office provides training on accrual basis of accounting at year-end training. All personnel related to recording the expenditures related to this program will be required to attend the meeting. In addition, the Auditor’s office will require all department heads and chief fiscal officers to sign off on the accuracy and completeness of their revenue and expenditures prior to closing each fiscal year going forward. Names of the contact persons responsible for corrective action: Aimee Espinoza, Auditor-Controller and Alonzo Solis, AC Senior Accountant. Planned completion date for corrective action plan: June 30, 2025, is not feasible due to the issuance date so expected completion date to June 30, 2026.

Block Grants for Community Mental Health Services - Assistance Listing No. 93.958 Recommendation: We recommend the County to conduct training with its various departments to instruct them on how to compile expenditures based on the accrual basis of accounting (when the expenditures were incurred). Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Auditor’s Controllers office provides training on accrual basis of accounting at year-end training. All personnel related to recording the expenditures related to this program will be required to attend the meeting. In addition, the Auditor’s office will require all department heads and chief fiscal officers to sign off on the accuracy and completeness of their revenue and expenditures prior to closing each fiscal year going forward. Names of the contact persons responsible for corrective action: Aimee Espinoza, Auditor-Controller and Alonzo Solis, AC Senior Accountant. Planned completion date for corrective action plan: June 30, 2025, is not feasible due to the issuance date so expected completion date to June 30, 2026.

Finding 2024-027 U.S. Department of Health and Human Services AL No. 93.940 HIV Prevention Activities Health Department Based Programs Material Weakness in Internal Controls and Noncompliance over Reporting Repeat Finding: Yes; 2023-023 Auditee’s Corrective Action Plan: BCHD fiscal department continues to revise its internal processes to strengthen capacity and to ensure compliance with 2 CFR 200 by implementing the following: A. Comprehensive staff training, supported by documented Standard Operating Procedures, training guides and updated policies which will include processes for timely submission of grant reports with required fiscal approvals. B. Create a standard reconciliation process that will ensure expenditures reported on required grantor reports are properly reflected in the general ledger in addition to clearly identifying variances from the SEFA due to timing. C. Created an internal comprehensive grants tracker via Smartsheet which includes all grant award periods, reporting requirements, due dates and other pertinent grant award data. D. Established a Contract and Compliance Unit responsible for overseeing the filing of the FFATA report. Contact Person: Unyime Ekpa, Chief Financial Officer, Baltimore City Health Department Completion Date: September 30, 2025

The Institution acknowledges the finding regarding the late submission of the No Cost Extension (NCE) for HEERF Student Aid funds, which resulted in the ED not approving the extension and subsequently categorizing the $41,146 in distributions to 13 students as unallowed activities. The delay in submitting the NCE request was due to limited guidance and a lack of awareness regarding the June 30, 2023, filing deadline. The Institution relied heavily on the Program Management Analyst for HEERF-related guidance, and amid the evolving nature of HEERF regulations, the deadline was not effectively communicated or acted upon in time. We accept responsibility for this oversight and are committed to ensuring full compliance with all future grant-related requirements. 1. Coordination with ED for Resolution & Fund Return Process: The Institution will proactively engage with the U.S. Department of Education (ED) to determine the proper process for returning the $41,146 in overdistributed HEERF Student Aid funds. We will promptly comply with any official request from ED regarding the return of funds, ensuring timely resolution of this issue. A designated financial aid compliance officer will oversee communication with ED to track all requirements and submission deadlines. 2. Strengthening Grant Compliance Procedures: A compliance checklist will be introduced for all future grant performance period extensions to ensure deadlines are met well in advance. The Institution will implement a Grant Compliance Tracking System to monitor: a. Key deadlines for grant extensions, reporting, and compliance filings. b. Required actions for all active federal grant awards to ensure timely submissions. 3. Enhanced Staff Training & Internal Oversight: The Institution will provide training to financial aid and grant management staff on: a. Federal grant regulations and performance period compliance. b. How to track and process NCE filings in a timely manner. c. Best practices for engaging with ED to ensure compliance and funding oversight. Staff will also undergo annual refresher training on Title IV and HEERF grant compliance. 4. Improved External Communication & Regulatory Monitoring a. The Institution will establish direct communication channels with ED representatives and external regulatory advisors to ensure awareness of any changes in grant policies, extensions, and reporting requirements. b. Monthly compliance review meetings will be held internally to verify that all federal grant deadlines are on track. By implementing these corrective actions, the Institution is confident that future federal grant extensions and reporting requirements will be met on time, ensuring continued compliance with all federal funding regulations. We appreciate the recommendations provided and are committed to maintaining strong financial oversight and accountability. Personnel Responsible for Implementation: Danielle Skinner Position of Responsible Personnel: President Expected Date of Implementation: Immediate

1. Corrections to NSLDS Program-Level and Campus-Level Data Reporting: The Institution has conducted a full review of its NSLDS records and is correcting all program-level data discrepancies, including the published program length for the Machine Tool Technology/Machinist program. We are updating the "Weeks in Title IV Academic Year" field to ensure that NSLDS correctly calculates program length. A dedicated NSLDS Compliance Checklist will be implemented to ensure that all program-level and campus-level data is aligned with institutional records before submission. 2. Strengthening Accuracy in Campus-Level Enrollment Reporting: A mandatory second-level review process will be implemented for all graduation and withdrawal status updates to prevent misreported enrollment dates or statuses. NSLDS data will be cross-checked monthly against the Institution’s internal student records to proactively detect and correct any discrepancies. 3. Improving Timeliness in Certification of Enrollment Status: The Institution will implement a structured 60-day certification schedule to ensure that all enrollment changes are reported to NSLDS within federal timeframes. A compliance tracking system will be introduced to flag students requiring enrollment status updates, allowing for proactive monitoring and timely submission 4. Staff Training and Process Improvement: The Institution will train financial aid and student records personnel on NSLDS reporting standards, including: a) Accurate program length calculations and Title IV academic year reporting. b) Timely certification of enrollment changes to remain within the 60-day requirement. c) Common reporting errors and best practices for NSLDS data management. Annual refresher training sessions will be held to ensure staff remain up to date on NSLDS reporting regulations and procedural improvements. 5. Internal Compliance Monitoring & Quality Assurance: A quarterly audit of NSLDS reporting will be conducted by a designated compliance officer to identify and correct discrepancies before regulatory deadlines. The Institution will establish internal controls and reporting checklists to ensure consistency, accuracy, and compliance with federal requirements. Personnel Responsible for Implementation: Danielle Skinner Position of Responsible Personnel: President Expected Date of Implementation: Immediate

2024-001 Reporting (Financial) Student Financial Assistance Cluster: U.S. Department of Education Federal Direct Student Loans (ALN 84.268) Federal Grant Numbers and Years: P268K240460, (9/1/2023-8/31/2024) Finding Type: Material Weakness and Noncompliance Responsible personnel: Alyssa Timko, Director of Financial Aid, act2156@tc.columbia.edu, 212 678-3654 Corrective Action Plan: In September 2023, the College identified a technical issue with the manual reporting process for student loan disbursements to COD and determined the existing solution was only partially functioning at that time. While some loan activity was timely and properly reported to COD, other student disbursement transactions were stalled and reported after the 15-calendar day requirement. At that time, the College’s ERP, Banner, job submission process for disbursement reporting to COD was manually initiated by the Office of Financial Aid. The resulting reports were then uploaded through the DOE’s EDconnect, a Windows based software application, using WinSCP file transfer (the same process was used for return files from COD). After an evaluation, it was determined that a new solution and process was required to ensure proper, complete and timely reporting under the regulations. The reporting process was redesigned in October 2023 as part of a plan to automate loan origination and now functions through Automic, a workload automation software. Instead of manually generated files and upload / receipt through EDconnect, student loan disbursement records are now automated to/from COD using TDClient, which is a command software for sending and receiving student aid related information through the DOE’s Student Aid Internet Gateway (SAIG). The new process regularly transfers loan disbursement data to COD. However, the College also determined that a prescheduled pause in the Automic loan origination process at the end of the fiscal year 2024 academic year (in August 2024), which was established in accordance with the regulations, also inadvertently paused loan disbursement reporting and resulted in late submissions. The Office of Financial Aid has also remedied this issue by adding non-standard reporting days to the standard calendar. Along with more frequent and recurring reconciliations of Banner to COD loan disbursement data and ensuring the continuation of disbursement reporting after loan originations are paused at the end the academic year, the College does not anticipate any further late reporting matters and expects all future disbursement data to be reported within 15 calendar days.

Finding #2024-004 – Significant Deficiency and Other Noncompliance. Applicable federal programs: U. S. Department of Health and Human Services, Direct Federal Funding, HIV Prevention Activities Non-Governmental Organizational Based, Assistance Listing #93.939, Contract #6NU62PS924649-03-03, Contract year: 07/01/23 – 06/30/24, Contract #5NU62PS924649-04-00, Contract year: 07/01/24 – 06/30/25. U. S. Department of Health and Human Services, Direct Federal Funding, Cooperative Agreement to Support Navigators in Federally-Facilitated Exchanges, Assistance Listing #93.332, Contract #NAVCA210403-03-03, Contract year: 08/27/23 – 08/26/24, Contract #NAVCA240482-01-00, Contract year: 08/27/24 – 08/26/25. U. S. Department of Health and Human Services, Direct Federal Funding, Children’s Health Insurance Program, Assistance Listing #93.767, Contract #2Y2CMS331859-02-05, Contract year: 07/01/23 – 06/30/25. U. S. Department of Health and Human Services, Passed through Texas Health and Human Services Commission, Block Grants for Prevention and Treatment of Substance Abuse, Assistance Listing #93.959, Contract #HHS000539700204 YPI, Contract year: 09/01/23 – 08/31/24, Contract #HHS000539700204 YPS, Contract year: 09/01/23 – 08/31/24, Contract #HHS000539700204 YPU, Contract year: 09/01/23 – 08/31/24. Condition and context: During our testing of payroll, non-payroll and indirect cost pool transactions, we identified the following exceptions: Controls over allowable cost compliance – all major programs. In a sample of 59 non-payroll transactions tested for internal controls over compliance: One instance of annual advertising contract charged in full rather than establishing a prepaid expense for the eleven months after Civic Heart’s year-end of August 31, 2024. The applicable grant period is July 1, 2023 through June 30, 2025 and thus, only one month, or approximately $417, was outside the period of performance (AL #93.767 Children’s Health Insurance Program). One instance of $2,700 charged to wrong program. Allowable costs of the Navigator program were charged to Connecting Kids program due to coding to the wrong class code in the general ledger. (AL#93.767 Children’s Health Insurance Program (Connecting Kids). In a sample of 135 payroll transactions tested for internal controls over compliance: Four instances of errors in the amount of costs charged to class code due to a clerical error in the payroll allocation spreadsheet. (AL #93.959 Block Grants for Prevention and Treatment of Substance Abuse and AL #93.939 HIV Prevention Activities Non-Governmental Organizational Based). Other non-compliance: AL #93.767 Children’s Health Insurance Program: In a sample of 40 payroll or vendor charges, one instance of non-compliance with allowable cost compliance ($417). AL #93.332 Cooperative Agreement to Support Navigators in Federally-Facilitated Exchanges: In a sample of 42 payroll or vendor charges, one instance of non-compliance with allowable cost compliance ($2,700). AL #93.939 HIV Prevention Activities Non-Governmental Organizational Based: In a sample of 40 payroll or vendor charges, two instances of non-compliance with allowable costs due to charge to the wrong program. Controls over period of performance – all major programs. In a sample of 56 vendor transactions and 4 pay periods with grant beginning or ending dates during the audit period, we found: 13 instances of charging vendor costs to the wrong grant period. One instance of charging payroll costs to the wrong grant period. Other non-compliance: AL #93.332 Cooperative Agreement to Support Navigators in Federally-Facilitated Exchanges: In a sample of 14 vendor charges tested, we found 4 exceptions for charging to the wrong grant period (approximately $3,120). AL #93.939 HIV Prevention Activities Non-Governmental Organizational Based. In a sample of 27 vendor charges tested, we found 4 exceptions for charging to the wrong grant period (approximately $480). In a sample of four pay periods tested, we found one exception for charging costs to the wrong grant period (approximately $5,350). AL# 93.959 Block Grants for Prevention and Treatment of Substance Abuse. In a sample of 25 vendor charges tested, we found 5 exceptions for charging to the wrong grant period (approximately $660). Recommendation: Emphasize adherence to established policies and procedures to ensure maintenance of payroll spreadsheets and reviews of coding for all transactions. Planned corrective action: Adherence to established policies and procedures will be strengthened by providing additional training when onboarding accounting staff, as well as additional oversight to the disbursement and payroll process. New accounting staff will be more thoroughly trained on established policies and procedures, including accruals, proper financial statement period recognition, grant award period of performance, tracking of grant activities using class codes, and allowable cost requirements. In addition, the CFO will ensure sufficient time is dedicated to reconciling payroll spreadsheets, payroll allocations, period of performance, and payroll accruals. Salaries and wages charged to the grant are now based on actual work performed determined by hours submitted by employee and approved by the applicable supervisor; this new control should assist in mitigating posting errors related to incorrect grants and grant periods. Responsible officer: Angelica Castillo, CFO. Estimated completion date: June 30, 2025.