Corrective Action Plans

Finding 555110 (2023-001)

Material Weakness 2023

Crosspurpose

CO

Questioned Costs Subrecipient Monitoring Allowable Costs / Cost Principles § 200.4

Effective October 1, 2023, management implemented extensive accounting and documentation controls to ensure full accounting and reporting compliance on direct costs incurred for all federal grants and expenditures. These controls are reviewed and monitored for compliance by management on a periodic ...

Effective October 1, 2023, management implemented extensive accounting and documentation controls to ensure full accounting and reporting compliance on direct costs incurred for all federal grants and expenditures. These controls are reviewed and monitored for compliance by management on a periodic basis during the year.

View Audit 353705 Questioned Costs: $1

Finding 554894 (2023-002)

Material Weakness 2023

Lincoln Hall

NY

Internal Control / Segregation of Duties Questioned Costs Material Weakness

Finding Number: 2023-002 Closing Process – (Material Weakness) Planned Corrective Action: The auditors noted issues related to the timeliness of the financial statement close process, the quantity of entries to close the books, the reconciliation of the beginning trial balance to the prior year aud...

Finding Number: 2023-002 Closing Process – (Material Weakness) Planned Corrective Action: The auditors noted issues related to the timeliness of the financial statement close process, the quantity of entries to close the books, the reconciliation of the beginning trial balance to the prior year audited trial balance, and a lack of segregation of duties which led to journal entries being prepared, reviewed and posted by the same person in the general ledger system. The issues noted were largely the result of significant turnover within the Finance Department, including the departure of the former head of the department without a proper transfer of institutional knowledge to remaining staff or incoming leadership. Since that time, oversight has improved considerably, and key processes have been reviewed, updated, and formally documented. While the current size of the Finance Team necessitates that the same individual generally enters and posts journal entries, we have implemented compensating controls that we believe are appropriate given the assessed levels of risk and materiality. These controls include role-specific responsibilities for journal entries and reconciliations. For example, with respect to cash activity, different team members handle cash receipts, disbursements, and inter-account transfers. A fourth team member is responsible for preparing the monthly bank reconciliations, which are then formally reviewed and signed off by Fiscal Department management, including the CFO. Management remains committed to strengthening internal controls, maintaining adequate segregation of duties to the extent practicable, and continuing to enhance the overall financial close and reporting process. Person Responsible: The Executive Director and Chief Financial Officer Completion Date: April 30, 2025

View Audit 353459

Finding 554893 (2023-001)

Material Weakness 2023

Lincoln Hall

NY

Questioned Costs Allowable Costs / Cost Principles Material Weakness

Finding Number: 2023-001 Cost Allocations – (Material Weakness) Planned Corrective Action: The auditors noted that payroll and the related personnel costs are not being charged directly or allocated to the correct cost center in the Serenic Navigator accounting system monthly. The Finance team perf...

Finding Number: 2023-001 Cost Allocations – (Material Weakness) Planned Corrective Action: The auditors noted that payroll and the related personnel costs are not being charged directly or allocated to the correct cost center in the Serenic Navigator accounting system monthly. The Finance team performed manual calculations of all allocations in Excel at the end of the fiscal year to update the allocations. Beginning in FY 2025, personnel costs are being manually recorded to the correct cost centers in Serenic Navigator each month. A parallel review of employee setups in ADP, our payroll system, led to the reassignment of staff to appropriate cost centers as needed. Going forward, ADP cost center assignments will be reviewed monthly to reflect any departmental changes. These steps are expected to reduce manual adjustments, improve the accuracy of interim financials, and ensure more precise federal and program drawdowns. Person Responsible: The Executive Director and Chief Financial Officer Completion Date: April 30, 2025

View Audit 353459

Finding 554889 (2023-001)

Material Weakness 2023

Arctic Village Tribal Council

AK

Cash Management Questioned Costs Material Weakness § 200.305

Federal Award Findings Finding 2023-001 Lack of Internal Controls Over Cash Management Name of Contact Person: Galen Gilbert, First Chief Corrective Action Plan: AVC staff were unable to complete a drawdown for the HUD grants due to a change in staff. AVC is working with HUD to resolve the matt...

Federal Award Findings Finding 2023-001 Lack of Internal Controls Over Cash Management Name of Contact Person: Galen Gilbert, First Chief Corrective Action Plan: AVC staff were unable to complete a drawdown for the HUD grants due to a change in staff. AVC is working with HUD to resolve the matter. AVC staff is currently drawing down all other funds in a timely matter. AVC has limited unrestricted cash. AVC is currently looking for opportunities to increase unrestricted cash, such as increasing prices for gas and electric. Proposed Completion Date: July 31, 2024

View Audit 353454 Questioned Costs: $1

Finding 554823 (2023-007)

Material Weakness 2023

City of Cortland

NY

Questioned Costs Allowable Costs / Cost Principles Reporting

Financial Statement Finding: 2023-007 Noncompliance with Uniform Guidance Late Filing of Single Audit Reporting Package Criteria: Under the Single Audit Act of 1996 and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements f...

Financial Statement Finding: 2023-007 Noncompliance with Uniform Guidance Late Filing of Single Audit Reporting Package Criteria: Under the Single Audit Act of 1996 and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), §200.512, Report Submission, the Single audit reporting package is required to be filed within the earlier of 30 calendar days after receipt of the auditors' report, or 9 months after the end of the audit period. Cause/Condition: Staffing shortages caused the delays in financial reporting. This deadline was not met on a timely basis for the year ended December 31, 2023. Effect: As a result, the entity is not incompliance with §200.512 of the Uniform Guidance. Recommendation: We recommend the requirements of §200.512 of the Uniform guidance be adhered to by striving to have all information required for the audit available on a timely basis. This will help to ensure timely audit report issuance and compliance with the filing deadline. Response: The City is still facing staffing shortages and is working to get the subsequent financial statements completed. It is expected the 2024 reporting package will be filed on time. Corrective Action Plan: The City has hired a full complement of staff in the Finance department, and anticipates timely filings going forward. Anticipated Completed Date: September 30, 2025. Responsible Contact Person: Elizabeth Greenwood, Director of Administration & Finance

View Audit 353407

Finding 554782 (2023-003)

Material Weakness 2023

East Central Missouri Behavioral Health Services D/b/a Arthur Center

MO

Special Tests & Provisions Questioned Costs

Views of Responsible Officials and Planned Corrective Actions: A new Sliding Discount Fee Policy was approved by the board in March 2025 and will be trained to staff and published publicly in all sites. Ongoing, errors in the sliding fee will be addressed by training staff involved in the process a...

Views of Responsible Officials and Planned Corrective Actions: A new Sliding Discount Fee Policy was approved by the board in March 2025 and will be trained to staff and published publicly in all sites. Ongoing, errors in the sliding fee will be addressed by training staff involved in the process and updating our procedures to include periodic audits of the sliding fee discounts.

View Audit 353362

Finding 554774 (2023-003)

None 2023

Tri-County Opportunities Industrialization Center, Inc.

PA

Questioned Costs Subrecipient Monitoring Reporting § 200.512

Recommendation: We recommend that the Center implement procedures to ensure that the audit reports are ﬁled within the regulatory deadlines. Action Taken: Tri-County OIC has taken the following steps to ensure timely submission of audit reports: Created a Compliance Calendar that...

Recommendation: We recommend that the Center implement procedures to ensure that the audit reports are ﬁled within the regulatory deadlines. Action Taken: Tri-County OIC has taken the following steps to ensure timely submission of audit reports: Created a Compliance Calendar that includes all major reporting deadlines, including audit report submission due dates. Assigned Responsibility to the Finance Administrator and Executive Director to monitor deadlines and coordinate with the external auditors in a timely manner. Established a 90-Day Pre-Deadline Notification System to ensure ail audit preparation materials are compiled and submitted to auditors well in advance. Incorporated Audit Timeline Planning into the organization's annual ﬁnancial closeout procedures. Scheduled Regular Check-ins between the Finance Team and auditors to track progress and address delays proactively. These steps are desitzned to improve internal coordination and accountabiiity, ensuring that all future audits are submitted within the reguired timeframe. Anticipated Completion Date: April 15, 2025 Contact Person Responsible: Christina Johnson, Executive Director

View Audit 353355

Finding 554485 (2023-002)

Material Weakness 2023

Holbrook Housing Authority

MA

HUD Housing Programs Internal Control / Segregation of Duties Questioned Costs

2023-002 - Reporting Auditee’s Response and Planned Corrective Action The Authority is now under the management of the Quincy Housing Authority and all controls and processes have been updated to account for the needs of the Holbrook Housing Authority, including internal controls over financial re...

2023-002 - Reporting Auditee’s Response and Planned Corrective Action The Authority is now under the management of the Quincy Housing Authority and all controls and processes have been updated to account for the needs of the Holbrook Housing Authority, including internal controls over financial reporting, documentation retention, and timeliness of reporting. Planned Implementation Date of Corrective Action: June 30, 2024 Person Responsible for Corrective Action: James Marathas, Executive Director

View Audit 353119

Finding 554473 (2023-003)

Significant Deficiency 2023

Meals on Wheels of Middle Georgia, Inc.

GA

Questioned Costs Internal Control / Segregation of Duties Special Tests & Provisions

Views of Responsible Officials and Planned Corrective Actions: See Comment 2023-001 and 002. Date to be implemented: See Comment 2023-001 and 002. Persons responsible: See Comment 2023-001 and 002

View Audit 353107

Finding 554450 (2023-008)

Significant Deficiency 2023

Leech Lake Tribal College

AZ

Questioned Costs Allowable Costs / Cost Principles § 200.405

The Department will enforce policies and procedures to ensure that the calculated rates are in agreement with the approved indirect cost rate.

View Audit 353088 Questioned Costs: $1

Finding 554444 (2023-007)

Significant Deficiency 2023

Leech Lake Tribal College

AZ

Questioned Costs Reporting Significant Deficiency § 200.328

The Department has ramped up recruiting efforts by advertising positions on external websites such as indeed. The accounting department has recently increased the wages of existing staff and the starting wages of all positions in an effort to attract and retain qualified staff.

View Audit 353088

Finding 554432 (2023-005)

Material Weakness 2023

Leech Lake Tribal College

AZ

Questioned Costs Material Weakness Reporting § 200.512

The Department has hired a new audit firm that specializes in the audits of Tribes. Our new audit firm has demonstrated a commitment to allocating the necessary resources to complete our audits in a timely manner.

View Audit 353088

Finding 554426 (2023-004)

Material Weakness 2023

Leech Lake Tribal College

AZ

Internal Control / Segregation of Duties Questioned Costs Material Weakness

The College is in the process of establishing journal entry controls including an independent review and approval process for all entries and ensuring sufficient documentation is maintained for each entry.

View Audit 353088

Finding 554420 (2023-003)

Material Weakness 2023

Leech Lake Tribal College

AZ

Internal Control / Segregation of Duties Questioned Costs Material Weakness

The College has spent a significant amount of time in FY 2025 evaluating their IT controls and policies and procedures. New internal controls are expected to be implemented to address these findings.

View Audit 353088

Finding 554398 (2023-002)

Material Weakness 2023

Island County Economic Development Council

WA

Allowable Costs / Cost Principles Internal Control / Segregation of Duties Questioned Costs § 200.303

Material Weakness in Compliance and Internal Control over Compliance Recommendation: CLA recommends that additional emphasis of documentary evidence of approvals be made, and such evidence is retained by ICEDC as proof of oversight of expenditure of federal funds. Additionally, we recommend adding ...

Material Weakness in Compliance and Internal Control over Compliance Recommendation: CLA recommends that additional emphasis of documentary evidence of approvals be made, and such evidence is retained by ICEDC as proof of oversight of expenditure of federal funds. Additionally, we recommend adding a review and approval process for the ED’s timesheets. There is no disagreement with the audit finding. Action taken in response to finding: ICEDC appreciates CLA’s recommendation to enhance processes concerning the retention of documentary evidence of approvals and importance of maintaining strong oversight of expenditures, especially when handling federal funds. ICEDC will place greater emphasis on obtaining and retaining documentation of approvals related to the expenditure of funds. This documentation will serve as proof of oversight, ensuring compliance with federal regulations and enhancing transparency in fund management. A formal review and approval process will be established for the Executive Director's (ED’s) timesheets. This process will involve periodic reviews by a designated authority and documentation will be retained to maintain a clear audit trail. Name(s) of the contact person(s) responsible for corrective action: Kristina Hines Planned completion date for corrective action plan: 8/31/2025

View Audit 353072 Questioned Costs: $1

Finding 554358 (2023-007)

Significant Deficiency 2023

Exeter Township School District

PA

Reporting Questioned Costs School Nutrition Programs § 200.510

Federal Program Child Nutrition Cluster - Passed through the Pennsylvania Department of Education and Pennsylvania Department of Agriculture ALNs 10.555 and 10.553 Education Stabilization Fund - Passed through the Pennsylvania Department of Education ALN 84.425 Criteria Per the Uniform Guidance 2 C...

Federal Program Child Nutrition Cluster - Passed through the Pennsylvania Department of Education and Pennsylvania Department of Agriculture ALNs 10.555 and 10.553 Education Stabilization Fund - Passed through the Pennsylvania Department of Education ALN 84.425 Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The District prepared a SEFA and provided information relating to the federal programs including grant agreements and other supporting documentation. However, the SEFA prepared by the auditee required material adjustments as a result of audit procedures. Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the SEFA provided by the auditee were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context A SEFA was prepared by management; however, several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding Yes. See finding 2022-003. Recommendation In order to meet Uniform Guidance requirements, the District should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response The new Assistant Business Manager has been trained in Uniform Guidance requirements as well as Federal program guidelines. This should not happen in the future.

View Audit 352972

Finding 554357 (2023-006)

Significant Deficiency 2023

Exeter Township School District

PA

Questioned Costs Subrecipient Monitoring Reporting

Federal Program Education Stabilization Fund - Passed through the Pennsylvania Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund (ARP ESSER) ALN 84.425U; Contract #223-21-0141; Grant Period 03/13/20 - 09/30/24 COVID-19 - ARP ESSER Learning Loss Set Aside ALN 84...

Federal Program Education Stabilization Fund - Passed through the Pennsylvania Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund (ARP ESSER) ALN 84.425U; Contract #223-21-0141; Grant Period 03/13/20 - 09/30/24 COVID-19 - ARP ESSER Learning Loss Set Aside ALN 84.425U; Contract #225-21-0141; Grant Period 03/13/20 - 09/30/24 Criteria The District is required to submit an annual performance report to the Commonwealth of Pennsylvania (the “State”) with data on expenditures, planned expenditures, subrecipients, and uses of funds, including for mandatory reservations. Condition During the year ended June 30, 2023, the District submitted a report for the funds used during the year ended June 30, 2022. The report submitted by the District contained expenditure amounts that did not agree to the amounts reported on the schedule of expenditures of federal awards for the year ended June 30, 2022. Cause When the information was entered into the performance report in the Pennsylvania Information Management System (PIMS), errors were made in the expenditure numbers input in the system. The review process in place did not detect the errors. Effect The information submitted, which will be used in the State’s report to the Department of Education, was not accurate for the key line items that we tested based on the Compliance Supplement published by the Office of Management and Budget. Questioned Costs None. Context The District is required to submit the performance report on an annual basis. The required report was submitted timely. The expenditures reported did not agree to expenditures on the June 30, 2022 schedule of expenditures of federal awards. Repeat Finding No. Recommendation We recommend the District update its report filing procedures to include comparing the expenditures entered on the annual performance report to the audited schedule of expenditures of federal awards. Management Response The District had a finding in the 2021 - 2022 audit that had non-allowable expenses. When the district received the audit, the 2023 federal reports were already submitted. The District made the adjustments for non-allowable expenses in the 2023 SEFA and took out the non-allowable in the 2024 State reports.

View Audit 352972

Finding 554356 (2023-005)

Significant Deficiency 2023

Exeter Township School District

PA

Questioned Costs Procurement, Suspension & Debarment Allowable Costs / Cost Principles

Federal Program Education Stabilization Fund - Passed through the Pennsylvania Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund (ARP ESSER) ALN 84.425U; Contract #223-21-0141; Grant Period 03/13/20 - 09/30/24 COVID-19 - ARP ESSER Learning Loss Set Aside ALN 84...

Federal Program Education Stabilization Fund - Passed through the Pennsylvania Department of Education COVID-19 - Elementary and Secondary School Emergency Relief Fund (ARP ESSER) ALN 84.425U; Contract #223-21-0141; Grant Period 03/13/20 - 09/30/24 COVID-19 - ARP ESSER Learning Loss Set Aside ALN 84.425U; Contract #225-21-0141; Grant Period 03/13/20 - 09/30/24 Criteria In accordance with Uniform Guidance Post Federal Award Requirements, the District must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition The District did not maintain effective internal controls over the Federal awards. Two invoices were coded to the grants that were paid without documented approval. Cause The District did not follow documented internal control procedures which require all disbursements to have an approved purchase order or invoice signed by an administrator. Effect By paying invoices coded to Federal grants without approval, the District is not verifying the allowability of invoices. This increases the risk that unallowable activities and costs can be charged to the Federal grants and go undetected. Questioned Costs None. Context The Education Stabilization Fund grant nonpayroll costs were made up of 23 invoices. We tested three individually significant and five sampled invoices. Of the five sampled invoices, we found that two invoices were paid without approval. However, no discrepancies were identified in the allowability of the invoices. Repeat Finding No. Recommendation We recommend the District follow documented internal control procedures requiring all disbursements have an approved purchase order or signed invoice. This will ensure that invoices coded to Federal grants are reviewed for allowability before they are applied to the grants. Management Response This has been rectified. The district had a vacancy in the Federal Program Coordinator. Either the new Federal program Coordinator or the Business Administrator will approve and initial the invoices prior to payment.

View Audit 352972

Finding 554298 (2023-005)

None 2023

Solutions for Change, Inc.

CA

Questioned Costs

Finding 2023-005 - Replacement Reserve Withdrawals – Neighborhood Stabilization Program, Assistance Listing Number 14.256: Statement of Condition Withdrawals in the amount of $26,000 were made from the replacement reserve account for the Projects acquired with Neighborhood Stabilization Program fund...

Finding 2023-005 - Replacement Reserve Withdrawals – Neighborhood Stabilization Program, Assistance Listing Number 14.256: Statement of Condition Withdrawals in the amount of $26,000 were made from the replacement reserve account for the Projects acquired with Neighborhood Stabilization Program funds were used to cover operating cash flow needs during the year ended December 31, 2023. Criteria According to the County of San Diego Department of Housing and Community Development (the “County”) Regulatory Agreements, disbursements from the replacement reserve accounts may only be made to fund Project expenses with the approval of the County. Effect Solutions for Change was not in compliance with the terms of the County Regulatory Agreements during the year and the replacement reserve accounts had a deficient balance of $30,693 at December 31, 2023. Cause Solutions for Change used funds from the replacement reserve account to cover operating cash flow needs. Recommendation Replacement reserves should be repaid. Future withdrawals should not be used without the approval of the County. Management Response Acknowledgment of Findings: Management acknowledges and agrees with this audit finding. Withdrawals totaling $26,000 were made from the Replacement Reserve Account to support the Project. For over 15 years, Solutions for Change has consistently met this obligation through private-sector donations. However, extraordinary challenges beyond our control limited our ability to do so in this period, necessitating the use of reserve funds. Cause Analysis: Management has conducted an in-depth analysis of the factors leading to this finding and determined that the primary cause is directly related to California’s Housing First mandate. This state-imposed approach significantly reduces funding opportunities for nonprofits that operate accountability-based, self-sufficiency-driven housing models. Under Housing First, funding is restricted to programs that do not require job placement, sobriety, or self-improvement interventions, which are essential elements of Solutions for Change’s proven approach. This policy shift has resulted in decreased access to public funding, forcing a greater reliance on private donations. In response, we made the strategic decision to uphold our core values despite financial uncertainties. Corrective Action Plan: To restore the Replacement Reserve Account, the Board of Directors has approved a comprehensive divestment strategy, including the sale of privately owned real estate controlled by the nonprofit. The proceeds from this sale will fully replenish the Replacement Reserve Account in the amount of $30,693. • Planned Sale Timeline: Between June and November 2025 • Full Restoration of Replacement Reserve: By December 1, 2025 This restoration effort is part of a multi-year strategic recovery plan that incorporates a private-sector initiative called “Bridge to Freedom.” In addition, the Board is exploring alternative funding streams to ensure financial stability while maintaining program integrity. Commitment to Financial Responsibility: Solutions for Change remains fully committed to responsible financial management and long-term sustainability. We will continue to implement strategic measures to secure financial stability while staying true to our mission of solving family homelessness through transformative, self-sustaining solutions.

View Audit 352898

Finding 554151 (2023-019)

Significant Deficiency 2023

State of California

CA

Allowable Costs / Cost Principles Internal Control / Segregation of Duties Questioned Costs § 200.300 § 200.303 § 200.309 § 200.403

The CDSS’ Disability Determination Services Division (DDSD) has implemented corrective measures to address inaccuracies in the Modernized Integrated Disability Adjudicative System (MIDAS) and Disability Case Processing System (DCPS) invoice review processes. This includes an internal quality control...

The CDSS’ Disability Determination Services Division (DDSD) has implemented corrective measures to address inaccuracies in the Modernized Integrated Disability Adjudicative System (MIDAS) and Disability Case Processing System (DCPS) invoice review processes. This includes an internal quality control process to monitor and review additional invoice samples from Branches after they have been processed and reviewed by Branch Program Technicians and Branch Auditors. Additionally, the DDSD Central Support Services Branch implemented a secondary audit process and created a new Auditor role to routinely sample additional Medical Evidence of Record (MER) and Consultative Examination (CE) contracts. Findings are provided to branches to reinforce accuracy and assure compliance. The DDSD, also transitioned from MIDAS to DCPS, which provides more sophisticated fiscal controls. To remediate any inaccuracies, DDSD’s centralized auditor will assess findings and develop an action plan to prevent erroneous invoices. The CDSS ensures that all necessary controls are in place to verify the accuracy and proper documentation of invoices. The CDSS concludes that the sample size of 15 MER cases does not provide sufficient audit evidence that controls are not operating effectively resulting in a calculated $54,398 in potential costs. However, CDSS agrees with the finding and is committed to the control and mitigation of risk related to the audit recommendation. Estimated Implementation Date: Implemented Contact: Bernice Stanfield, Fiscal and Procurement Section Chief Central Support Services Branch Disability Determination Service Division California Department of Social Services

View Audit 352774 Questioned Costs: $1

Finding 554140 (2023-013)

Material Weakness 2023

State of California

CA

Subrecipient Monitoring Internal Control / Segregation of Duties Questioned Costs § 200.303

The CDSS disagrees with the finding. California’s subsidized child care system is locally operated. The CDSS relies on hundreds of local county offices and nonprofit agencies to administer child care and development programs at the local level, rather than having the State pay subsidized providers d...

The CDSS disagrees with the finding. California’s subsidized child care system is locally operated. The CDSS relies on hundreds of local county offices and nonprofit agencies to administer child care and development programs at the local level, rather than having the State pay subsidized providers directly. As a result, CDSS required Alternative Payment Programs, direct-service contractors that administer Family Child Care Home Education Networks, and fiscal partners to track survey completion as a prerequisite for awarding American Rescue Plan Act (ARPA) subgrants. This local infrastructure and the size of California’s subsidized child care and development system separates California from other states. As a result, CDSS worked very closely with the federal grantor, the Administration for Children and Families, to ensure that the ARPA survey methodology met federal monitoring requirements and tracked data elements required by the federal government. For this reason, CDSS believes it has fulfilled its responsibility and does not need to further establish a monitoring program. Estimated Implementation Date: Will not implement Contact: Jeff Fowler, Staff Services Manager III Child Care and Development Program California Department of Social Services

View Audit 352774 Questioned Costs: $1

Finding 554139 (2023-012)

Material Weakness 2023

State of California

CA

Questioned Costs Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303 § 200.332 § 200.513 § 200.521

The CDSS agrees with the finding. The Child Care and Development Division's Program Quality Improvement Branch (PQIB) recognized the need for tracking monitoring procedures starting from risk assessment identification to closing out of Continuous Improvement Plans (CIP) to ensure that contractors wi...

The CDSS agrees with the finding. The Child Care and Development Division's Program Quality Improvement Branch (PQIB) recognized the need for tracking monitoring procedures starting from risk assessment identification to closing out of Continuous Improvement Plans (CIP) to ensure that contractors with the highest risk factors are prioritized and agencies requiring follow up received a CIP. • Tracking Use of the Risk Assessment: Annually, the PQIB identifies risk criteria for the upcoming Fiscal Year (FY) monitoring through the Contract Monitoring Protocols Agreement document. Using the Consultant Caseload Cohorts spreadsheet staff identify the agencies they will monitor using the FY Monitoring Priorities criteria (risk assessment criteria). The PQIB Travel Team and Administrators review the monitoring schedules for each consultant to ensure the risk assessment criteria has been followed. The risk assessment criteria are reviewed and updated annually based on trends and support needs of the field. In FY 2023-2024 PQIB implemented a cohort review cycle to apply the risk assessment criteria to all contracted programs subject to monitoring reviews. • Maintaining Monitoring Reports: Each Contract Monitoring Report includes a “Monitoring Summary Page” containing all items reviewed during a Contract Monitoring Review (CMR). Any item from the Program Integrity Monitoring Tool identified during a review as unmet and/or identified for a CIP is automatically tracked by the analysts for follow-up and resolution. A spreadsheet with all the reviews scheduled for any contract monitoring visit are maintained by FY and the findings are recorded for each item on the tool. The PQIB analysts track the review dates, reports, findings, and CIPs. The analysts meet with the administrators monthly to track missing reports. All reports are filed by individual agency. • Continuous Improvement Plan (CIP): The PQIB analysts use the Contract Monitoring Report to determine if a CIP is required. A standard CIP template was developed, and all staff are required to use the same document. Every CIP has a 45-day corrective action period; however, programs may be granted extensions if requested in writing. Programs can request up to an additional 180 days to complete corrective actions. To receive an extension, a plan must be submitted in writing detailing how the program will address the actions by the end of the extension period. The PQIB analyst conducts follow-up with the consultant until the CIP is received. The CIP is not closed until all items identified for corrective action are resolved. A completed CIP and Resolution Letter are sent to the contractor and filed in the Common Folder in the agency’s folder. All spreadsheets, agreements, forms, and records of completed monitoring reports referenced above are maintained in the Common Folder and on the PQIB SharePoint page. Furthermore, CDSS is actively working to fully adopt audit report monitoring responsibilities of Local Education Agencies (LEA) and certain non-LEAs receiving Child Care and Development Fund (CCDF) Cluster program funds by July 1, 2025. Estimated Implementation Date: July 1, 2025 Contact: Jeff Fowler, Staff Services Manager III Child Care and Development Program California Department of Social Services

View Audit 352774 Questioned Costs: $1

Finding 554138 (2023-011)

Material Weakness 2023

State of California

CA

Matching / Level of Effort / Earmarking Reporting Questioned Costs § 200.303

The CDSS has sufficient internal controls for the Federal Fiscal Year (FFY) 2022 grants onward. The CDSS was not the lead agency for the FFY 2020 and 2021 grants. During those years, the California Department of Education (CDE) held the responsibilities as the lead agency and had custody of the gran...

The CDSS has sufficient internal controls for the Federal Fiscal Year (FFY) 2022 grants onward. The CDSS was not the lead agency for the FFY 2020 and 2021 grants. During those years, the California Department of Education (CDE) held the responsibilities as the lead agency and had custody of the grants. As such, CDSS cannot be held accountable for the reports submitted by CDE. The CDSS is unable to validate or provide commentary on the data or information reported by CDE for those periods. The CDSS is the lead agency for FFY 2022 grants onward and has assumed full responsibilities for all related procedures, including the review, preparation, and submission of quarterly reports with complete and accurate information. The CDSS is diligently monitoring and managing the process to ensure that future reconciliations are conducted with the utmost accuracy and timeliness. The CDSS is also collaborating closely with all relevant stakeholders to ensure that the current data is thoroughly verified and aligned. The CDSS maintains comprehensive documentation supporting all expenditures, including the Schedule of Expenditures of Federal Awards (SEFA) report. Furthermore, CDSS has strengthened our internal checks and improved communication with all involved parties to mitigate the risk of issues arising in future reconciliations. Estimated Implementation Date: Implemented Contact: Daniel During, Federal Reporting Section Chief Accounting and Fiscal Systems Branch Finance and Accounting Division California Department of Social Services

View Audit 352774

Finding 554137 (2023-010)

Material Weakness 2023

State of California

CA

Procurement, Suspension & Debarment Subrecipient Monitoring Questioned Costs § 200.303

The CDSS agrees with the finding and recognizes the importance of effective report tracking and the timely submission of fiscal and compliance reports, with clearly defined responsibilities and workflows to ensure accuracy. When the grants were transferred from CDE to CDSS, no formal guidance was pr...

The CDSS agrees with the finding and recognizes the importance of effective report tracking and the timely submission of fiscal and compliance reports, with clearly defined responsibilities and workflows to ensure accuracy. When the grants were transferred from CDE to CDSS, no formal guidance was provided during the transition. The delay in submission was due to multiple factors including training new staff, understanding the different pieces of the various grants, and the most impactful factor was the information to produce the Federal Funding Accountability and Transparency Act (FFATA) report. To produce the FFATA report, the Federal Reporting Section (FRS) had to reach out to every contractor, vendor, county, etc. and ask for their assistance to fill out the FFATA report information. This was a labor- and time-consuming process due to the size of the grant. As a result, it took some time for the FRS to gather the necessary information and become fully familiar with the procedures required to prepare the FFATA report. To minimize the risk of late report submission, FRS has ensured that all staff understand the final deadline and all key milestones along the way. The FRS has broken down the report into smaller, manageable tasks within individual deadlines which helps to avoid last-minute rushes and ensure steady progress. The FRS utilizes Microsoft Teams as a project management tool to track deadlines, monitor progress, and send reminders to keep everyone on track. The FRS conducts regular check-ins to discuss progress, address any challenges early, and adjust the plan as needed to prevent delays. Additionally, FRS has created a standardized template to save time and allow the team to work efficiently. Staff are now completing their individual reports ahead of time which gives ample room for review and revisions to ensure the FFATA report is prepared accurately and timely. Estimated Implementation Date: Implemented Contact: Daniel During, Federal Reporting Section Chief Accounting and Fiscal Systems Branch Finance and Accounting Division California Department of Social Services

View Audit 352774

Finding 554135 (2023-018)

Significant Deficiency 2023

State of California

CA

Allowable Costs / Cost Principles Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

DHCS recently implemented and instructed all staff on an improved leave management and timesheet submission process, effective November 20, 2024, beginning with the December 2024 pay period. The change addresses the recommendations from CSA by streamlining the submission, review, and storage of empl...

DHCS recently implemented and instructed all staff on an improved leave management and timesheet submission process, effective November 20, 2024, beginning with the December 2024 pay period. The change addresses the recommendations from CSA by streamlining the submission, review, and storage of employee timesheets, ensuring efficient and transparent management of time-related data across DHCS. Furthermore, the new process ensures a manager or supervisor reviews and approves all timesheets before submission. Estimated Implementation Date: November 20, 2024 Contact: California Department of Health Care Services • Primary – Erika Cristo Assistant Deputy Director, Behavioral Health • Secondary – Wendy Rasmussen, Chief, Office of Compliance - Internal Audits

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