Corrective Action Plans

Finding 397487 (2023-035)

None 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Allowable Costs / Cost Principles § 200.1 § 200.410

Finding: The Office of Superintendent of Public Instruction improperly charged $42,265 to the Special Education Cluster. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 84.173 COVID-19 Amount $42,265 Status: Corrective action complete Corrective Action: As stated in...

Finding: The Office of Superintendent of Public Instruction improperly charged $42,265 to the Special Education Cluster. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 84.173 COVID-19 Amount $42,265 Status: Corrective action complete Corrective Action: As stated in the finding, the Office has adequate internal controls to comply with period of performance requirements. To address the allowable periods for journal vouchers (corrections), the Office will ensure the correction cycle will align with federally established liquidation periods. In response to the finding, the Office has updated procedures to strengthen internal controls, as follows: • Monitor monthly expenditures to ensure the Office stays within the allowable pre-determined threshold and grant award limit. • Complete expenditure corrections within the grant liquidation period. • Liquidate obligations charged to the grant on the last business day of January (or 120 days after the budget period ends). • Request prior approval of late liquidations from the federal grantor as needed. The Office will communicate the corrective action plan with internal stakeholders to ensure compliance with updated process/procedures. The Office will consult with the federal grantor to discuss whether the questioned costs identified in the audit should be repaid. Completion Date: January 2024 Agency Contact: Amy Kollar Director of Agency Financial Services PO Box 47200 Olympia, WA 98504-7200 (360) 725-6283 Amy.kollar@k12.wa.us

View Audit 306534 Questioned Costs: $1

Finding 397486 (2023-034)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Allowable Costs / Cost Principles Subrecipient Monitoring § 200.1 § 200.410

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with requirements to ensure it met the earmarking requirements for the Special Education program. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 8...

Finding: The Office of Superintendent of Public Instruction did not have adequate internal controls over and did not comply with requirements to ensure it met the earmarking requirements for the Special Education program. Questioned Costs: Assistance Listing # 84.027 84.027 COVID-19 84.173 84.173 COVID-19 Amount $378,206 Status: Corrective action complete Corrective Action: When the Special Education program underwent a fiscal leadership transition in 2021, the incoming director identified necessary changes in agency procedures for closing out fiscal year (FY) 2021. The director and budget analyst have been maintaining weekly check-ins since May 2022 to discuss the implementation of proper internal controls. Beginning in FY 2023, the Office has fully implemented processes to ensure spending plans do not exceed the maximum allowable amounts earmarked for administration and other state-level activities. The updated procedures require the director of Operations and the budget analyst to perform the following: • Review criteria for spending plans at the beginning of the fiscal year. • Review the Grant Award Notice and Grants to States Summary Table and Preschool Grants to States Summary Table. • Review spending plans and update the maximum allowable amounts earmarked for administration and other state-level activities in the spending plan throughout the fiscal year. • Meet weekly to review spending plans and update plans as requests are received. • Review monthly expenditure reports during weekly meetings. These updated procedures have contributed to increased communication and partnership between the director of Operations and the budget analyst. These internal controls provide assurance that the Office will meet earmarking requirements and compliance with federal rules. The Office will consult with the federal grantor to discuss whether the questioned costs identified in the audit should be repaid. The conditions noted in this finding were previously reported in finding 2022-025. Completion Date: March 2024 Agency Contact: Tania May Assistant Superintendent, Special Education PO Box 47200 Olympia, WA 98504-7200 (360) 725-6075 Tania.may@k12.wa.us

View Audit 306534 Questioned Costs: $1

Finding 397462 (2023-084)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Reporting Subrecipient Monitoring

Finding: The Health Care Authority did not have adequate internal controls to ensure payments to providers for the Block Grants for Prevention and Treatment of Substance Abuse program were allowable and met period of performance requirements. Questioned Costs: Assistance Listing # 93.959 93....

Finding: The Health Care Authority did not have adequate internal controls to ensure payments to providers for the Block Grants for Prevention and Treatment of Substance Abuse program were allowable and met period of performance requirements. Questioned Costs: Assistance Listing # 93.959 93.959 COVID-19 Amount $3,447,346 Status: Corrective action not taken Corrective Action: The Authority does not concur with the finding. The Authority maintains that its internal controls are effective, and procedures are compliant with grant requirements. No corrective action will be implemented. The costs questioned by the auditor do not reflect funds that have been paid or drawn from the grantor. As a result, there are no funds to return to the grantor. The conditions noted in this finding were previously reported in findings 2022-067, 2021-057, and 2020-059. Completion Date: Not applicable Agency Contact: William Sogge, CPA, CIA External Audit Liaison PO Box 45502 Olympia, WA 98504-5502 (360) 725-5110 william.sogge@hca.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397448 (2023-071)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Cash Management Matching / Level of Effort / Earmarking

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure cash draws for the Social Services Block Grant were properly supported. Questioned Costs: Assistance Listing # 93.667 Amount $1,504,566 Statu...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure cash draws for the Social Services Block Grant were properly supported. Questioned Costs: Assistance Listing # 93.667 Amount $1,504,566 Status: Corrective action in progress Corrective Action: The Department maintains that funds were not improperly charged to the Social Service Block Grant (SSBG) program. This is a two-year grant that the Department spends down in one fiscal year. The expenditures drawn were allowable and within the period of performance and the one exception identified was due to the timing of expenditure transfers. The Department utilizes grant-level management for all federal funds, including the SSBG program. This process consists of making grant-level adjustments between allowable grant sources to properly spend grant dollars within the allowable period of performance and ensure level of effort and matching requirements are met. The Department allocated the SSBG funds to eligible clients and allowable activities in compliance with 45 CFR 98.67 but did not include the level of data recommended by the State Auditor’s Office (SAO) for some transfers. The Department is committed to collaborating with SAO to determine an appropriate methodology which identifies a sampling unit that can be used to accurately test compliance. In response to the auditor’s recommendations, the Department will develop and maintain a business process that would allow adjustments to include transaction level data. Completion Date: Estimated December 2025 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397447 (2023-070)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to providers were allowable and properly supported for the Social Services Block Grant. Questioned Costs: Assistance Listing # 93.667 ...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to providers were allowable and properly supported for the Social Services Block Grant. Questioned Costs: Assistance Listing # 93.667 Amount $8,518,020 Status: Corrective action in progress Corrective Action: The Department maintains that funds were not improperly charged to the Social Services Block Grant (SSBG) program. The Department utilizes grant-level management for all federal funds, including the SSBG program. This process consists of making grant-level adjustments between allowable grant sources to properly spend grant funds within the allowable period of performance and ensure level of effort and matching requirements are met. The Department allocated the SSBG funds to eligible clients and allowable activities in compliance with 45 CFR 98.67 but did not include the level of data recommended by the State Auditor’s Office (SAO) for some transfers. Cost objectives within the accounting system are used to track SSBG funding. Expenditures eligible for the SSBG program are transferred at the cost objective level and not the transaction level. The SAO tested a sample of 16,006 payments which totaled 94% of total provider payments charged to the grant. SAO found that all payments were for activities that were supported, allowable, authorized, and accurate. SAO is questioning the costs of the remaining payments because the transfer of expenditures was not completed at the transaction level. Those remaining payments were transferred from eligible and allowable expenditures for the SSBG program. The Department is committed to collaborating with SAO to determine an appropriate methodology which identifies a sampling unit that can be used to accurately test compliance. In response to the auditor’s recommendations, the Department will develop and maintain a business process that would allow adjustments to include transaction level data. Completion Date: Agency Contact: Estimated December 2025 Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397413 (2023-051)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Matching / Level of Effort / Earmarking Subrecipient Monitoring § 200.303 § 200.403 § 200.410 § 200.53

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and property supported. Questioned Costs: A...

Finding: The Department of Children, Youth, and Families did not have adequate internal controls over and did not comply with requirements to ensure payments to child care providers paid with Temporary Assistance for Needy Families funds were allowable and property supported. Questioned Costs: Assistance Listing # 93.558 Amount $107,338,725 Status: Corrective action in progress Corrective Action: The Working Connections Child Care (WCCC) program was previously managed by the Department of Social and Health Services (DSHS) and the Department of Early Learning. Since the program transitioned in 2019, the Department has been making efforts to strengthen internal controls over payments to child care providers and other grant requirements. The Department implemented grant-level management of all federal funds, including the Temporary Assistance for Needy Families grant. This consisted of making significant grant level adjustments between allowable grant sources to properly spend grant dollars within the allowable period of performance and ensure level of effort and matching requirements were met. The Department’s grant adjustments were processed based on eligible clients and allowable activities. The Department does not currently have the staff to develop and maintain the business process redesign, as well as the information technology initiatives necessary to meet the level of assurance recommended by the State Auditor’s Office. In response to the auditor’s recommendations, the Department submitted a budget request for the 2024 supplemental budget. Funding was provided to develop and maintain the business process that would allow adjustments to include child-level data beginning July 2024. The conditions noted in this finding were previously reported in findings 2022-035 and 2021-028. Completion Date: Estimated December 2025 Agency Contact: Stefanie Niemela Audit Liaison PO Box 40970 Olympia, WA 98504-0970 (360) 725-4402 stefanie.niemela@dcyf.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397403 (2023-046)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.516

Finding: The Department of Health did not have adequate internal controls to ensure payments to subrecipients were allowable, met cost principles, and were within the period of performance for the Epidemiology and Laboratory Capacity for Infectious Diseases program. Questioned Costs: Assistance ...

Finding: The Department of Health did not have adequate internal controls to ensure payments to subrecipients were allowable, met cost principles, and were within the period of performance for the Epidemiology and Laboratory Capacity for Infectious Diseases program. Questioned Costs: Assistance Listing # 93.323 93.323 COVID-19 Amount $1,735 Status: Corrective action not taken Corrective Action: The Department does not concur with the finding. The Department disagrees with the State Auditor’s Office (SAO) assessment of a material weakness in internal controls over the consolidated contract provider payment process for the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program. The Department has established processes in place to ensure payments are allowable and meet cost principles for the program. These include: • Perform annual review and approval of detailed subrecipient budgets. • Compare invoice amounts to budgeted amounts for reasonableness before payment approval. • Provide subrecipients with regular technical assistance and training on applicable policies related to fiscal and programmatic processes. • Conduct biennial program and fiscal monitoring visits to subrecipients as part of the Department’s monitoring procedures. In addition, the ELC program has monitoring controls in place and evidence of review at the program level. Program staff maintain a detailed spreadsheet that documents review and approval and includes any amounts that need to be withheld until issues with invoice support are resolved. These reviews are to be completed within the 10-day period before payment is released. The Department is planning on meeting with federal grantors to work through the exceptions and questioned costs identified in the finding. The conditions noted in this finding were previously reported in finding 2022-033. Completion Date: Not applicable Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397397 (2023-044)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.516

Finding: The Department of Health did not have adequate internal controls to ensure payments to subrecipients were allowable, met cost principles, and were within the period of performance for the Immunization Cooperative Agreements program. Questioned Costs: Assistance Listing # 93.268 93.2...

Finding: The Department of Health did not have adequate internal controls to ensure payments to subrecipients were allowable, met cost principles, and were within the period of performance for the Immunization Cooperative Agreements program. Questioned Costs: Assistance Listing # 93.268 93.268 COVID-19 Amount $416,027 Status: Corrective action not taken Corrective Action: The Department does not concur with the finding. The Department disagrees with the State Auditor’s Office (SAO) assessment of a material weakness in internal controls over the consolidated contract provider payment process for the Immunizations Cooperative Agreements program. The level of documentation received from the subrecipient accounting system provided assurance that the exceptions questioned by SAO met federal cost principles for allowability and period of performance. The Department has established processes in place to ensure payments are allowable and meet cost principles for the program. These include: • Program staff maintain detailed budget information for each subrecipient by project area, and as A-19s are submitted, program and accounting staff update budget spreadsheets. When reviewing the support provided by the subrecipient, staff ensure amounts submitted by project are reasonable and align with expectations for the budget period submitted. • Program staff refer to the federal Immunization Program Operations Manual to determine procedures related to allowable costs, purchases, and procurement. • The Fiscal Monitoring Unit provides technical assistance and training to program staff and subrecipients while onsite and at the request of the entities receiving funding. • Program staff provides policy guidance, technical assistance, and training to subrecipients related to program compliance requirements. The program has continued to strengthen processes to ensure supporting documentation aligns with the agency’s documentation matrix for subrecipients in accordance with assigned risk level. The Department is planning on meeting with federal grantors to work through the exceptions and questioned costs identified in the finding. The conditions noted in this finding were previously reported in finding 2022-031. Completion Date: Not applicable Agency Contact: Jeff Arbuckle External Audit Manager PO Box 47890 Olympia, WA 98504-7890 (360) 701-0798 Jeff.Arbuckle@doh.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397219 (2023-029)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.1 § 200.403 § 200.410

Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements for monitoring subrecipients to ensure payments were allowable, properly supported and met period of performance requirements for the Coronavirus State and Local F...

Finding: The Department of Social and Health Services did not have adequate internal controls over and did not comply with requirements for monitoring subrecipients to ensure payments were allowable, properly supported and met period of performance requirements for the Coronavirus State and Local Fiscal Recovery Funds. Questioned Costs: Assistance Listing # 21.027 COVID-19 Amount $312,659,850 Status: Corrective action in progress Corrective Action: The Department partially concurs with the finding. The Department’s Office of Refugee and Immigrant Assistance (ORIA) administered this funding through the Washington COVID-19 Immigrant Relief Fund program and contracted with a subrecipient organization to conduct eligibility determinations to approve and disburse funds to undocumented immigrants. This program is now closed, with all subrecipient contracts ended and the final payments sent in early 2023. The Department is taking action to strengthen internal controls over subrecipient monitoring for ORIA’s contracts. By July 2024, the Department will: • Complete a review of all active contracts utilizing federal funding to ensure subrecipients are accurately identified. • Explore the feasibility of increasing ORIA and Economic Services Administration accounting staff resources to support the workload increase associated with monitoring subrecipients. By October 2024, the Department will convene a work group with contracts and accounting staff to create effective internal controls and written procedures for fiscal and program monitoring of ORIA’s subrecipient contracts. This will include the following: • Verify the subrecipient status for each contract is correctly determined and recorded in the Agency Contracts Database. • Include the required subrecipient language in the contract. • Obtain a copy of the indirect rate certification or cost allocation plan from the subrecipient. • Complete risk assessments. • Create appropriate monitoring plans for each subrecipient. • Conduct fiscal monitoring of each subrecipient to obtain assurance that the use of federal funds complies with federal laws and regulations. • Create corrective action plans when required. By January 2025, the Department will ensure all ORIA program staff responsible for monitoring receive training on the updated procedures. In addition, the Office of the Secretary will request the Department’s Internal Audit and Consultation office conduct an internal audit of ORIA to ensure the program implements strong internal controls, properly accounts for federal funds, and materially complies with federal requirements. The Department does not concur with the questioned costs. The funds were used to assist Washington workers/families who were affected by the COVID-19 pandemic but were unable to access federal stimulus programs and other social support due to their immigration status. Repayment of these funds would only hinder the state’s ability to provide critical services to our clients. If the grantor contacts the Department regarding the questioned costs, the Department will discuss this with the Department of Health & Human Services and will take additional action as appropriate. Completion Date: Estimated January 2025 Agency Contact: Richard Meyer External Audit Compliance Manager PO Box 45804 Olympia, WA 98504-5804 (360) 664-6027 Richard.Meyer@dshs.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397218 (2023-028)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.1 § 200.410

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements to monitor subrecipients and to ensure payments were allowable, properly supported, and met period of performance requirements for the Coronavirus State and Local Fiscal Recovery Fu...

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements to monitor subrecipients and to ensure payments were allowable, properly supported, and met period of performance requirements for the Coronavirus State and Local Fiscal Recovery Funds. Questioned Costs: Assistance Listing # 21.027 COVID-19 Amount $75,251,225 Status: Corrective action in progress Corrective Action: Completion Date: Agency Contact: The Legislature appropriated Coronavirus State and Local Fiscal Recovery Funds (SLFRF) to the Department’s Energy Division to award assistance to utility service providers to eliminate customer account arrearages. Payments for the program ended in 2022 and the program is no longer funded by the Department. The Department will implement procedures to strengthen internal controls for future programs managed by the Energy Division to ensure payments to subrecipients are adequately supported, allowable, and only reimburse costs incurred during the grant period of performance. As part of the audit resolution process, the Department will: • Work with utilities to obtain official client arrearage reports to verify the amounts paid and the period in which they were incurred. • Verify all households served were eligible per U.S. Treasury guidance. • Reconcile all allowable and unallowable expenditures. • Consult with the grantor to discuss the resolution of any questioned costs identified. Estimated July 2024 Gena Allen, CFE Internal Control Officer PO Box 42525 Olympia, WA 98504-2525 (360) 480-5149 Gena.Allen@Commerce.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397217 (2023-027)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.1 § 200.410 § 200.516

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements for monitoring subrecipients to ensure payments were allowable, properly supported and met period of performance requirements for the Coronavirus State and Local Fiscal Recovery Fun...

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements for monitoring subrecipients to ensure payments were allowable, properly supported and met period of performance requirements for the Coronavirus State and Local Fiscal Recovery Funds. Questioned Costs: Assistance Listing # 21.027 COVID-19 Amount $95,560 Status: Corrective action complete Corrective Action: The Department’s Eviction Rental Assistance program which was funded with the Coronavirus State and Local Fiscal Recovery Funds ended in June 2023. During the audit period, the Department implemented procedures to strengthen internal controls to ensure expenditures were allowable, properly supported, and in compliance with the subrecipient fiscal monitoring requirements. The Department’s Homelessness Assistance Unit implemented the following corrective actions: · Updated unit reimbursement procedures to include a requirement for supporting documentation that details transaction level expenditure information for direct expenses that reconciles to payment requests. · Provided training to staff on reviewing transaction level supporting documentation to ensure expenditures reconcile with reimbursement requests and are within the period of performance. · Added a review note to each reimbursement request to document the grant coordinator’s review of documentation and reconciliation to payment requests. · Worked with the Department’s internal control officer for review and feedback of the updated procedures. The Department is currently working to standardize a reimbursement documentation process that is in compliance with federal requirements. The Department will discuss any repayment of questioned costs through the normal audit resolution process with the Department of Treasury. The conditions noted in this finding were previously reported in finding 2022-019. Completion Date: April 2024 Agency Contact: Gena Allen, CFE Internal Control Officer PO Box 42525 Olympia, WA 98504-2525 (360) 480-5149 Gena.Allen@Commerce.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397216 (2023-026)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Allowable Costs / Cost Principles Subrecipient Monitoring § 200.334 § 200.335 § 200.336 § 200.337

Finding: The Office of Financial Management did not have adequate internal controls over and did not comply with requirements to ensure Coronavirus State and Local Fiscal Recovery Funds were used for only allowable activities. Questioned Costs: Assistance Listing # 21.027 COVID-19 Amount $30...

Finding: The Office of Financial Management did not have adequate internal controls over and did not comply with requirements to ensure Coronavirus State and Local Fiscal Recovery Funds were used for only allowable activities. Questioned Costs: Assistance Listing # 21.027 COVID-19 Amount $300,000,000 Status: Corrective action not taken Corrective Action: The Office does not concur with the audit finding. The state of Washington implemented internal controls and created Fund 706 to track the Coronavirus State and Local Fiscal Recovery Fund (SLFRF) expenditures. The state, through legislation, approved the transfer of $300 million from the SLFRF account to various state transportation accounts under the revenue loss provision. The Office reaffirms that all expenditures from the transportation accounts that received the SLFRF funds were used to maintain government services. The State Administrative and Accounting Manual requires all state agencies to establish internal controls over payments for goods and services, including ensuring payments are lawful and for proper purposes, reviewing payments to ensure they are supported, as well as documenting the review of all payments. State agencies continued to follow their established internal controls to ensure expenditures from the transportation accounts were proper and allowable for both non-SLFRF and SLFRF funds. The Office will continue to: • Work with the U.S. Treasury, through the audit resolution and management decision process, to ensure no questioned costs are required to be repaid. • Document all correspondence with the grantor during the audit resolution process. The conditions noted in this finding were previously reported in finding 2022-018. Completion Date: Not applicable Agency Contact: Sara Rupe Deputy Statewide Accounting Director PO Box 43127 Olympia, WA 98504-3127 (360) 974-9252 sara.rupe@ofm.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397203 (2023-017)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.1 § 200.403 § 200.410 § 200.516

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements to ensure payments to subrecipients of the Emergency Rental Assistance program were allowable and properly supported. Questioned Costs: Assistance Listing # 21.023 COVID-19 A...

Finding: The Department of Commerce did not have adequate internal controls over and did not comply with requirements to ensure payments to subrecipients of the Emergency Rental Assistance program were allowable and properly supported. Questioned Costs: Assistance Listing # 21.023 COVID-19 Amount $4,123,486 Status: Corrective action complete Corrective Action: The funding for the Emergency Rental Assistance program ended on June 30, 2023. The Department is no longer funding this program. To address the control deficiencies reported in the prior year’s finding, the Department improved internal control processes, resulting in improved compliance. The Department strives to meet all federal requirements and any repayment of questioned costs will be determined through the normal audit resolution process with the U.S. Treasury. The conditions noted in this finding were previously reported in finding 2022-016. Completion Date: July 2023 Agency Contact: Gena Allen, CFE Internal Control Officer PO Box 42525 Olympia, WA 98504-2525 (360) 480-5149 Gena.Allen@Commerce.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397201 (2023-015)

Material Weakness 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Subrecipient Monitoring Cash Management § 200.1 § 200.410 § 200.516

Finding: The Washington State Department of Transportation did not have adequate internal controls over and did not comply with cash management requirements for the Formula Grants for Rural Areas program. Questioned Costs: Assistance Listing # 20.509 Amount $41,555 Status: Corrective action com...

Finding: The Washington State Department of Transportation did not have adequate internal controls over and did not comply with cash management requirements for the Formula Grants for Rural Areas program. Questioned Costs: Assistance Listing # 20.509 Amount $41,555 Status: Corrective action complete Corrective Action: The audit identified a payment that was entered into the Electronic Clearing House Operation (ECHO) system with incorrect project information. The Department has since implemented additional controls to help ensure the draws of program funds are timely and accurate and are drawn for the correct program. To address the audit recommendations, the Department: • Assigned Project Support and Receivable (PS&R) staff to submit Public Transportation ECHO draws. Two additional staff have been identified as backup in this process to ensure draws are processed timely. • Rescheduled the entry of draw information into the ECHO system to the morning to allow for timely corrections as needed. • Updated the ECHO system to allow automatic confirmation email for payments entered into the system. Additionally, • The PS&R Manager will automatically receive draw confirmation emails and conduct a review and check as the draws are being submitted. • Additional checks and balances will be performed by the person entering information into the ECHO system. • The Public Transportation division has a validation process in place for staff to check the amounts with the project. The Department will continue to review procedures regularly and update as required to ensure compliance. The questioned costs identified in the audit have been reimbursed to the incorrectly charged federal program. Completion Date: October 2023 Agency Contact: Jesse Daniels External Audit Liaison PO Box 47320 Olympia, WA 98504-7320 (360) 705-7035 danielje@wsdot.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397185 (2023-006)

None 2023

State of Washington C/o Office of Financial Management

WA

Questioned Costs Allowable Costs / Cost Principles Eligibility § 200.1 § 200.410 § 200.516

Finding: The Employment Security Department made improper payments to ineligible beneficiaries of the Unemployment Insurance program. Questioned Costs: Assistance Listing # 17.225 17.225 COVID-19 Amount $603 Status: Corrective action not taken Corrective Action: The Department does not ...

Finding: The Employment Security Department made improper payments to ineligible beneficiaries of the Unemployment Insurance program. Questioned Costs: Assistance Listing # 17.225 17.225 COVID-19 Amount $603 Status: Corrective action not taken Corrective Action: The Department does not concur with the finding. The State Auditor’s Office (SAO) made the assertion that the Department incorrectly interpreted guidance in the Unemployment Insurance Program Letter (UIPL) No. 16-20 requiring claimants to provide proof of employment to receive Pandemic Unemployment Assistance (PUA) payments. However, the section cited by SAO was paragraph b(ii) which only lays out the requirements for establishing the respond-by dates for providing documentation for review. The deadline for responses is different depending on whether the PUA claim was filed before January 31, 2021, or on/after that date. This paragraph does not establish the requirements for payment or non-payment of PUA weeks. In our finding response, the Department cited section C.2 of the UIPL, which states: If, in that timeframe, the individual fails to provide documentation or fails to show good cause to have the deadline extended, an overpayment must be established for all of the weeks paid beginning with the week ending January 2, 2021. This is because the individual cannot be deemed ineligible for a week of unemployment ending before the date of enactment solely for failure to submit documentation. Therefore, the three cases identified by SAO should not be exceptions under this guidance. Further, the Department received guidance from the U.S. Department of Labor on January 11, 2021, which confirmed the proper methodology used by the Department. Completion Date: Not Applicable Agency Contact: Jay Summers External Audit Manager PO Box 9046 Olympia, WA 98507-9046 (360) 529-6718 Joshua.Summers@esd.wa.gov

View Audit 306534 Questioned Costs: $1

Finding 397027 (2023-006)

Material Weakness 2023

George Washington Carver Academy

MI

Questioned Costs Allowable Costs / Cost Principles Material Weakness

Corrective Action Plan: The Academy along with its new management company are reviewing, revising, and developing internal controls as necessary in order to comply with compliance requirements relevant to federal programs. Responsible Department: School Leadership Responsible Person: Laura Carp...

Corrective Action Plan: The Academy along with its new management company are reviewing, revising, and developing internal controls as necessary in order to comply with compliance requirements relevant to federal programs. Responsible Department: School Leadership Responsible Person: Laura Carpenter, CS Partners Planned Completion Date: Immediate

View Audit 306409 Questioned Costs: $1

Finding 397026 (2023-005)

Material Weakness 2023

George Washington Carver Academy

MI

Questioned Costs Allowable Costs / Cost Principles

Corrective Action Plan: The Academy along with its new management company are reviewing, revising, and developing internal controls as necessary in order to comply with compliance requirements relevant to federal programs. Responsible Department: School Leadership and Board and Financial Service ...

Corrective Action Plan: The Academy along with its new management company are reviewing, revising, and developing internal controls as necessary in order to comply with compliance requirements relevant to federal programs. Responsible Department: School Leadership and Board and Financial Service Provider together with which includes the bookkeeping, payroll, grants management, and purchasing functions. Responsible Person: Laura Carpenter, Comptroller, CS Partners Planned Completion Date: Immediate

View Audit 306409 Questioned Costs: $1

Finding 396712 (2023-002)

Significant Deficiency 2023

Aids Taskforce of Greater Cleveland, Inc.

OH

Questioned Costs Cash Management Allowable Costs / Cost Principles

Housing Opportunities for Persons with AIDS – Assistance Listing No. 14.241 Recommendation: We recommend the Organization designs controls to ensure the general ledger detail for each grant is reconciled to the monthly draw requests before they are submitted to the grantor for reimbursement. Explana...

Housing Opportunities for Persons with AIDS – Assistance Listing No. 14.241 Recommendation: We recommend the Organization designs controls to ensure the general ledger detail for each grant is reconciled to the monthly draw requests before they are submitted to the grantor for reimbursement. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: ATGC will delay the billing of any expense reimbursements until the general ledger activity has been reconciled ensuring all related expenses properly allocated within the ATGC General Ledger. Name(s) of the contact person(s) responsible for corrective action: Simpson Huggins Planned completion date for corrective action plan: June 30, 2024

View Audit 306347 Questioned Costs: $1

Finding 396709 (2023-001)

None 2023

Unlimited Housing for the Elderly Inc.

PA

Questioned Costs Reporting

Those charged with governance agree with the finding and will deposit the funds in the RFR account as soon as possible.

View Audit 306344 Questioned Costs: $1

Finding 396708 (2023-001)

None 2023

Parker Presbyterian Senior Housing Inc.

PA

Questioned Costs HUD Housing Programs Reporting

Those charged with governance have requested a waiver of deposits to the reserve for replacements account from HUD that would apply retroactively to the outstanding deposits for prior years. The Project has made the required monthly deposits for the year ending December 31, 2023.

View Audit 306343 Questioned Costs: $1

Finding 396694 (2023-001)

Significant Deficiency 2023

Swope Health Services and Subsidiaries

MO

Questioned Costs Period of Performance Reporting

Identifying Number: 2023-001 Finding: Swope Health Services and Subsidiaries expended federal funding on an invoice with a service period outside of the Period of Availability for Period 5 of the Provider Relief Fund. Corrective Actions Taken or Planned: Management will evaluate and alter the ac...

Identifying Number: 2023-001 Finding: Swope Health Services and Subsidiaries expended federal funding on an invoice with a service period outside of the Period of Availability for Period 5 of the Provider Relief Fund. Corrective Actions Taken or Planned: Management will evaluate and alter the accounts payable invoice review process as necessary to mitigate the risk of inaccurate recording of prepaid expenditures, as was the case in this finding. Management will consider the need to reorganize the assignment of duties as they pertain to the processing and review of invoices and vendor payments to ensure a sufficient level of review of material transactions to ensure accurate accounting of vendor payments. Person Responsible: Naimish Patel, CFO Anticipated Completion Date: Plan to be completed by December 31, 2024

View Audit 306320 Questioned Costs: $1

Finding 396627 (2023-002)

Significant Deficiency 2023

Midmichigan Health Services

MI

Questioned Costs HUD Housing Programs Significant Deficiency

Finding Number: 2023-002 Condition: Not all patients received updated adjustments based on the new schedule. Planned Corrective Action: Previously the sliding fee scale/medical care discount applications and adjustments were performed by billing department staff. Unfortunately, billing department d...

Finding Number: 2023-002 Condition: Not all patients received updated adjustments based on the new schedule. Planned Corrective Action: Previously the sliding fee scale/medical care discount applications and adjustments were performed by billing department staff. Unfortunately, billing department did not follow the policies implemented by Management that were in place to manage the sliding fee scale/medical care discount program. Moving forward the sliding fee scale/medical care discount program will be managed and processed by the finance department. The finance department will ensure that the original policies to manage this program will be followed going forward. Contact person responsible for corrective action: Financial Analyst, Courtney Miller Anticipated Completion Date: 6/1/2024

View Audit 306236 Questioned Costs: $1

Finding 396610 (2023-004)

Significant Deficiency 2023

Urban College of Boston

MA

Questioned Costs Student Financial Aid

Corrective Action Plan: Urban College of Boston (UCB) has contracted with Global Financial Aid Services (Global FAS) effective for the 2023/2024 Award Year. In addition, Urban College has hired a new Director of Financial Aid who started on January 1, 2024 who is familiar with the rules around calcu...

Corrective Action Plan: Urban College of Boston (UCB) has contracted with Global Financial Aid Services (Global FAS) effective for the 2023/2024 Award Year. In addition, Urban College has hired a new Director of Financial Aid who started on January 1, 2024 who is familiar with the rules around calculating R2T4s. Going forward, Global FAS will be processing all Exits and Return to Title IV (R2T4) calculations as of the Fall semester of the 2023/2024 award year. The Director of Financial Aid at UCB has confirmed with Global FAS that our school profile is accurately, and the number of days being used in the R2T4 calculation is accurate based on the current Academic Calendar. Timeline for Implementation of Corrective Action Plan: The corrective action plan has been implemented as of September 2023. Contact Person: Stacy Broadus, Director of Financial Aid, stacy.broadus@urbancollege.edu

View Audit 306231 Questioned Costs: $1

Finding 396608 (2023-003)

Significant Deficiency 2023

Urban College of Boston

MA

Questioned Costs Student Financial Aid

Corrective Action Plan: The Business Office will review uncashed checks every 30 days as part of the ledger/billing reconciliation process to ensure these are addressed prior to the 240-day regulation. This process is being updated in the Business Office Cash Management operating procedure. The Bus...

Corrective Action Plan: The Business Office will review uncashed checks every 30 days as part of the ledger/billing reconciliation process to ensure these are addressed prior to the 240-day regulation. This process is being updated in the Business Office Cash Management operating procedure. The Business Office and the Director of Financial Aid will review monthly any uncashed checks to ensure that UCB is meeting the required timeline. Timeline for Implementation of Corrective Action Plan: This corrective action plan will be implemented by May 2024. Contact Person: Karen Lucas, Manager of Business Office, karen.lucas@urbancollege.edu

View Audit 306231 Questioned Costs: $1

Finding 396569 (2023-004)

None 2023

Keppel Union School District

CA

Questioned Costs Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking § 200.303 § 200.430

The District will require a PAR form from any employee covering a shift in Child Nutrition whose main job is not in the Child Nutrition Department. • The Director of Child Nutrition, Syed Zaidi, will identify and provide a PAR form for those employees providing services to the Child Nutrition Depart...

The District will require a PAR form from any employee covering a shift in Child Nutrition whose main job is not in the Child Nutrition Department. • The Director of Child Nutrition, Syed Zaidi, will identify and provide a PAR form for those employees providing services to the Child Nutrition Department in a substitute situation. To be established as of 6/30/2024.

View Audit 306138 Questioned Costs: $1

Corrective Action Plans

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