Corrective Action Plans

The District took immediate steps to remedy the issue, new reviews are required before and after submission. The Business Manager and Food Services Director have implemented the changes.

Federal Single Audit for the Period Ending June 30, 2024 Corrective Action Plan February 5, 2025 ➢ The major program the finding pertained to: 2024-001. Internal Control Over Compliance, United States Department of Agriculture, Passed-through New York State Department of Education: Child Nutrition Cluster, School Breakfast Program ALN: 10.553, National School Lunch Program ALN: 10.555 ➢ Condition: The District has not yet updated its existing policies and written procedures to conform to the Uniform Guidance requirements. ➢ Planned Corrective Action: The District has already updated its policy and related procedures in order to comply with the requirements of Uniform Guidance. The Board of Education adopted its policy in May 2024. ➢ Name, Title and Contact Info of Responsible Person: Sam M. Schneider Assistant Superintendent for Business East Hampton Union Free School District 4 Long Lane East Hampton, NY 11937 (631) 329-4106 sam.schneider@ehschools.org ➢ Anticipated Completion Date: Already implemented on May 21, 2024.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553 AND 10.555 2024-002 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary 2 CFR § 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal program. The District did not have sufficient controls in place within its child nutrition cluster federal program to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned – The District will review policies and procedures relating to suspension and debarment for its federal programs and will ensure that all parties with which it contracts for goods or services are eligible to participate in contracts involving the expenditures of federal program funding. Official Responsible – Kerstin Quigley, Business Manager. Planned Completion Date – June 30, 2025. Disagreement With or Explanation of Finding – The District agrees with this finding. Plan to Monitor – The District’s Business Manager and the Superintendent will ensure appropriate controls are in place to verify that any vendor with which the District contracts for federal program goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website.

Daily meal county reports will be reviewed and verified that it agrees to the edit check worksheets prior to monthly reimbursement submission. Any differences will be properly investigated and resolved.

FINDING 2024-001 Finding Subject: Child Nutrition Cluster-Eligibility Summary of Finding: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the following compliance requirements for Eligibility related to income guidelines and Direct Certifications. No controls were in place to ensure the Food Service Director was inputting the income guidelines into the Harmony software correctly and that direct certification reports were run at the start of the school year and monthly thereafter, and that the student statuses were updated, accordingly. No one verified that the year-to-date direct certification reports were run to catch any students that were missing. Contact Person Responsible for Corrective Action: Vonessia Harmon, Business Manager Contact Phone Number and Email Address: 765-569-4195 harmonv@ncp.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director is responsible for ensuring the annual Free & Reduced income guidelines are entered into the student software system prior to Online Registration each school year. The Food Service Director will provide a copy of the income guidelines to the Business Manager for review. The Business Manager will review the income guidelines for accuracy and keep the documentation on file. The Food Service Director is responsible for running the Direct Certification reports. Direct Certification Reports shall be completed at the start of each school year and on a monthly basis thereafter. The Food Service Director is responsible for ensuring that student records are updated to the proper eligibility status in the student software system. The Business Manager is responsible for reviewing the Direct Certification Reports on a monthly basis and confirming that the student records have been updated. Audit Evidence: Copies of annual income guidelines and all Direct Certification Reports signed by both the Food Service Director and the Business Manager will be kept on file along with proof of the updated student record(s). Anticipated Completion Date: Effective immediately

Finding 2024-002: Eligibility – Significant Deficiency in Internal Control over Compliance, Other Matter Compliance Finding Condition: During eligibility testing, we found instances of non-compliance, as follows: TEFAP – We noted that for one out of 20 participants sampled for TEFAP, an ineligible community partner organization was able to order approximately 100 pounds of TEFAP food from CAFB’s website. CSFP – We noted that for one out of 40 individual participants sampled for CSFP, one participant’s original enrollment documents supporting eligibility was missing. The organization did have the participant’s re-enrollment documents for the subsequent fiscal year. This is related to a person being eligible to receive food. Views of Responsible Officials and Planned Corrective Actions: The Organization's investigation into the root causes of the two incidents revealed clerical errors. For the TEFAP incident, a mistake in the partner organization's profile allowed access to USDA food via our online ordering portal. Regarding the CSFP participant, the initial eligibility documents were misplaced, but subsequent reauthorization documents were available. The Organization’s planned corrective actions with respect to the two instances include the following: TEFAP partner eligibility:  Review and enhance existing procedures for establishing partner organization profiles; and  Establish a periodic reconciliation of partner organization’s authorized to access TEFAP commodities in the online ordering portal with a listing of authorized TEFAP partners CSFP eligibility:  Review and enhance existing procedures for filing individual eligibility documents; and  Continued internal reviews by the Organization’s compliance department covering the filing of individual eligibility documents Anticipated Completion Date: March 2025

Action Taken: The district concurs with this finding. The staff of the district has been properly trained to use the Paid Lunch Equity (PLE) Tool provided by USDA to determine adequate price for paid lunches. The CFO will make the calculation annually and will take to the board any changes that need to be made to ensure compliance with TDA pricing regulations.

Action Taken: The district concurs with this finding. Management has clear job duties established and the CFO will be responsible for obtaining approval from TDA for capital asset purchases of $5000 or above.

2024-002 Timely Time and Effort Approvals The Center continues to evaluate its processes related to time and effort. Our Time and Effort electronic system has been evaluated and enhancements are forthcoming to include robust functionalities to include timely supervisor approval notifications. Proposed Completion Date: May 31, 2025 Name of contact person: Rumalda Ruiz, Deputy Director – Business, Operations, & School Finance Support Contact: (956) 984-6290

2024-004 Lack of Retention of Student Applications Condition: In our testing of 40 applications for free and reduced lunch, 1 applications was missing. All other applications properly determined received free or reduced meals as eligibility determined. Criteria: As part of determining student eligibility for free or reduced meals, the District receives applications from student families. Federal requirements require the Distict official making the eligibility determination to retain all applications. Cause: Administrative oversight led to one application not being retained. Effect: The District was not in compliance with the requirements of the Child Nutrition Cluster. Recommendation: We recommend the District implement a process that requires immediate filing and retention of all applications after eligibility is determined. View of responsible officials: See attachment for District’s corrective action plan.

The District will reduce net cash resources by investing in capital equiment where necessary and allocating direct cost overhead expenditures.

FINDING 2024-001 Child Nutrition Cluster - Eligibility School Breakfast program, National School Lunch Program, Eligibility, Significant Deficiency Contact Person Responsible for Corrective Action: Contact Phone Number: Kim Pusateri 219-659-0656 ext. 157 Views of Responsible Official: We concur with the finding. Internal Controls and procedures will be implemented to ensure accurate eligibility determinations for free and reduced-price meals by implementing internal controls, segregation of duties, and documented reviews. Description of Corrective Action Plan: Applications (eligibility): • Maintain records of all reviews for audit purposes. o Take a picture of the eligibility grid for review and date it. o Require two staff members (Director of Food Services and designee) to sign off on the review. Direct Certifications • The direct certification report will be run monthly and uploaded into the school point-of-sale system. A copy of the report will be saved, printed and checked that it was uploaded properly. A copy of the student's application and history will be printed and stapled to the direct cert report to verify that the change was made. It will be dated and initialed and saved in a folder. Anticipated Completion Date: Immediately

a. Significant Deficiency | Single Audit – “We recommend the District record reimbursements in the correct fiscal year.” b. Plan of Action – The District will establish a multi-step review process for all NSLP monthly meal claims to ensure accuracy. For the year-end claims (May/June) – should they be received after the end of the fiscal year they were claimed for – a journal entry that recognizes Accounts Receivable for the claim amount will be created and be reviewed for accuracy before being approved. c. Timeframe for (or date of) implementation – The multi-step review process for monthly NSLP meal claims has already been established (started in September 2024). The year-end journal entry process/review will be implemented in June 2025.

a. Significant Deficiency | Single Audit – “We recommend the District use someone other than the claim preparer to review the claims before being submitted, and document said review with initials and dates.” b. Plan of Actions – The District will establish a multi-step review process for all NSLP monthly meal claims to ensure accuracy. This process will include data input/review by the Nutrition Services Coordinator and review by the Director of Finance/Senior Accountant before submission to the state. c. Timeframe for (or date of) implementation - The multi-step review process for monthly NSLP meal claims has already been established (started in September 2024).

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER (FEDERAL ALN 10.553, 10.555, AND 10.559) 2024-002 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary 2 CFR § 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster. The District did not have sufficient controls in place within its child nutrition cluster to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Actions Planned – The District will review policies and procedures relating to suspension and debarment for its federal programs and will ensure that all parties with which it contracts for goods or services are eligible to participate in contracts involving the expenditures of federal program funding. Official Responsible – Bryan Hennekens, Director of Finance and Operations. Planned Completion Date – June 30, 2025. Disagreement With or Explanation of Finding – The District is in agreement with this finding. Plan to Monitor – Bryan Hennekens, Director of Finance and Operations, will work with the financial auditors to review specific weaknesses identified during the annual audit and actions needed to eliminate or mitigate this internal control weakness.

FINDING 2024-003 Finding Subject: Child Nutrition Cluster (School Lunch) – Allowable Cost Summary of Finding: The payroll for non-certified employees for the 2023-2024 school year has not been approved by the board, leading to a lack of verification for salaries paid from fund 800. As a result, any payroll for non-certified employees paid after August 1, 2023 from fund 800 cannot be verified. Contact Person Responsible for Corrective Action: Robin Popejoy Contact Phone Number and Email Address: 317.758.4172 – rpopejoy@sheridan.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The salary schedules will be submitted to the board for approval. Anticipated Completion Date: May – August 2025

FINDING 2024-005 Finding Subject: Child Nutrition Cluster (School Lunch) – Eligibility Summary of Finding: Café Director uploaded the Direct Certification reports from the state into the software system without following a documented oversight or review process to ensure that direct certified students were accurately processed. This highlights a lack of documented controls for directly certified students. Contact Person Responsible for Corrective Action: Robin Popejoy Contact Phone Number and Email Address: 317.758.4172 – rpopejoy@sheridan.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Data Department will collaborate with the Café Department to input and ensure the accuracy of the information. Anticipated Completion Date: Already started in August of 2024.

FINDING 2024-004 Finding Subject: Child Nutrition Cluster (School Lunch) – Suspension and Debarment Summary of Finding: One of the vendors tested did not have documentation showing that the school corporation had verified they were not suspended or debarred before entering into a covered transaction. Contact Person Responsible for Corrective Action: Robin Popejoy Contact Phone Number and Email Address: 317.758.4172 – rpopejoy@sheridan.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Café Direction will check SAM.gov to ensure the vendor is not suspended or debarred before proceeding with any transactions. Anticipated Completion Date: January 2025

Purchases to replace outdated equipment will be pursued. We already purchased $1.1 million over the past 2 years.

Payroll disbursements will align to the approved salary schedule.

Findings and Questioned Costs Related to Federal Awards Finding Number: 2024‐001 Program Name/Assistance Listing Title: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559 Contact Person: Anita Percell, Executive Director of Business Services Anticipated Completion Date: June 30, 2025 Planned Corrective Action: The District acknowledges the findings regarding the overcharging of indirect costs and is committed to ensuring full compliance with the federal cost principles and guidelines established by USDA and ADE. We will implement strengthened procedures, provide targeted training for relevant staff, and promptly reimburse the questioned costs.

The District had a positive balance in its nonprofit food service account as of June 30, 2022, therefore is exempt from the PLE pricing requirements for SY 23-24 and required to submit an exemption form. The District did not submit an exemption form for SY 23-24 to IL State Board of Education. The District will keep track of its nonprofit school food service account to determine if it is exempt from PLE pricing requirements for SY 24-25.

2024-004 FINDING Contact Person – Sue Chase, Superintendent Corrective Action Plan – The District should implement policies and procedures to ensure only allowable activities/costs are being charged against grants. Completion Date – December 30, 2024

One application was not properly approved by the verifying official: As the verifying official, the Food Service Director will check all applications going forward to ensure that the applications have been signed by the verifying official.

One application was incorrectly classified as free rather than paid: Food Service Director will send each building secretaries an email reminding them to make sure all sources of income are entered with the correct dollar amounts and frequency of pay so the eTrition system will calculate correctly to determine eligibility according to the USDA income eligibility guidelines. The determining officials and the verifying official will either attend in person or digitally a refresher class if offered by the Wilbur D Mills Education Cooperative in the summer of 2025.