Corrective Action Plans

Corrective Action: Child Nutrition will provide proof of documentation on all vendors illustration that they are not suspended or debarred. Also, invoices will be a part of the procurement packet. lt will be uploaded to the financial software system for primary filing and filed physically as a secondary method. Avery Johnson, Business Manager Robert Sanders, Superintendent Linda Little, Child Nutrition Director Corrective Action Start Date: February 18, 2025

Corrective Action Plan Finding 2024-001 Criteria: Recipients of federal awards must follow the procurement standards set out at 2 CFR section 200.317 through 200.326. They must use their own documented procurement procedures, which reflect applicable State laws and regulations, provided that the procedures conform to applicable Federal law and the procurement requirements identified in 2 CFR part 200. Recipients “must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price” 2 CFR section 200.318(i). The School’s procurement procedures include the requirement to maintain sufficient documentation of the history of procurement. The School also has procedures to identify procurement transactions requiring competitive bids or proposals. Auditor Recommendation: We recommend the Academy ensure it 1) maintains documentation of the history of procurement and 2) monitors compliance with documentation requirements. Auditee Response/ Corrective Action Plan: The Academy will review its procurement policies and internal controls and ensure timely action is taken when noncompliance is identified. Person Responsible: Dane Roberts, Executive Director and Randi Limb, Business Manager Timeline: All future contract solicitations will follow the required procurement standards.

FINDING 2024-002 Finding Subject: Child Nutrition Cluster - Eligibility Contact Persons Responsible for Corrective Action: Lacey Sturgeon, Food Service Director & Melissa Bell, Assistant Food Service Director Contact Phone Number and Email Addresses: (765) 893-4445 / lsturgeon@msdwarco.k12.in.us & mbell@msdwarco.k12.in.us Views of Responsible Officials: Option 1: We concur with the findings Description of Corrective Action Plan: Stronger internal controls are needed in regards to verification of Direct Certifications. We plan to make sure once the certifications are entered that the Food Service Director will check the work of the Assistant Food Service Director and show her approval by signing and dating each final report. Anticipated Completion Date: Effective Immediately

FINDING 2024-004 Finding Subject: Child Nutrition Cluster-Activities Allowed or Unallowed, Allowable Costs/Cost Principles Summary of Finding: Payments made based on statements or no supporting documentation. The School corporation did not properly implement a process to identify and assess internal and external risks, or monitor internal control activities to ensure they were operating effectively. Contact Person Responsible for Corrective Action: Melissa Embry Contact Phone Number and Email Address: 812-547-2637 melissa.embry@cannelton.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Invoices are already being given to the Corporation Treasurer monthly and are being attached to each Accounts Payable Voucher to show exactly what is being paid for. Cannelton management will establish a proper system of internal controls including policies and procedures related to risk assessment and monitoring activities within the federal program. Anticipated Completion Date: The noncompliance was corrected as of January 2025. The additional controls will be implemented by August 2025.

FINDING 2024-003 Finding Subject: Child Nutrition Cluster – Internal Controls Summary of Finding: There was a lack of internal controls. Additionally, the School corporation did not properly implement a process to identify and assess internal and external risks, or monitor internal control activities to ensure they were operating effectively. Contact Person Responsible for Corrective Action: Melissa Embry Contact Phone Number and Email Address: 812-547-2637 melissa.embry@cannelton.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The food service director now gets all the reports and appropriate supporting documentation, including receipts and disbursements reports, together and goes over it with the high school secretary/deputy treasurer and is then submitted by the secretary/deputy treasurer, printed off and given to the corporation treasurer. The corporation treasurer has a copy of the submission and compares that to what is deposited. All claims have always been approved by the School Board. Cannelton management will establish a proper system of internal controls including policies and procedures related to risk assessment and monitoring activities within the federal program. Anticipated Completion Date: August 2025

Condition: The Disrict did not maintain documentation supporting that the required calculations for PLE were completed. Plan: Policies and procedures will be implemented to ensure that the required PLE calculations are being made and documented. Anticipated Date of Completion: June 30, 2025. Name of Contact: James Dunlap, Superintendent. Management Response: Management does not disagree with this finding. In future years, the District will document their PLE calculations.

Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program AL Numbers: 10.553, 10.555 Federal Award Numbers and Years: FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Qualified Opinion Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the simplified acquisitions procurement method of the Procurement and Suspension and Debarment compliance requirement. Context: During the audit period, we tested two vendors that fell within the Small Purchase procurement threshold. Small purchases are those vendors that the School Corporation has purchased between $10,000 and $150,000 of products and goods from during the fiscal year. For one of the two vendors selected for testing, we noted the School Corporation did not obtain price or rate quotations from other vendors or document the basis for purchasing from the vendor that was utilized. The School Corporation had $134,542 and $117,589 of expenditures with the vendor for fiscal years 2023 and 2024, respectively. Corrective Action Plan: To meet the conditions of the grant agreement, Caston School Corporation will keep record of all vendors that are outside of our NIESC buying agreement. Vendors on this list will be identified as having an RFP on file or requiring an RFP to purchase. The director or the director’s purchasing designee will consult the list before ordering from the vendor. The School Corporation will ensure that the appropriate number or bids are obtained or will document the reasoning behind why the appropriate number of bids could not be obtained. The School Corporation will run a suspension and debarment check on vendors prior to entering into a contract. Person responsible for implementation and projected implementation date: The Food Services Director and/or the Director’s designee, as well as the Treasurer will be responsible for implementation of the corrective action plan, which will be done immediately.

Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Significant Deficiency Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Context: During the testing of internal controls over eligibility determinations for free and reduced meals, we noted management was unable to provide support for three of the 60 applications selected for testing. Additionally, for one of the 60 selections, the student was improperly classified as reduced when the annual income per the student’s application exceeded the corresponding threshold for that determination. Corrective Action Plan: The School Corporation will implement internal control procedures to ensure the applications are filed and maintained in a secure manner. The School Corporation will also implement internal control procedures to ensure that applications are formally reviewed by the Food Services Director and the Treasurer, so that applicants are accurately denied or approved for free or reduced meals. Person responsible for implementation and projected implementation date: The Corporation’s Food Services Director and Treasurer will be responsible for implementing the corrective action, which will be implemented immediately.

Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Context: During the testing of internal controls over eligibility determinations for free and reduced meals, we noted there was no formal review control in place for 26 of the 60 applications selected for testing. Additionally, for one of the 60 selections, the student was improperly classified as free when the annual income per the student's application exceeded the corresponding threshold for that determination. Corrective Action Plan: The School Corporation will implement a system of internal controls to ensure that the applications are being formally reviewed by the Food Services Director and the Corporation Treasurer. Person responsible for implementation and projected implementation date: The Food Services Director and the Corporation Treasurer will be responsible for implementing the corrective action, which will begin with applications for the 2025-2026 school year.

Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the eligibility compliance requirement. Context: During testing over controls for eligibility, for 16 of the 60 applications selected, we noted there was no formal evidence that the applications had been reviewed and further, the application did not specify if the student was eligible for free or reduced lunch. We also noted for 2 of the 60 selections, management was unable to provide support for the student that was selected. Corrective Action Plan: The Food Services Director and the Treasurer will both sign off on the applications once they have completed their review to determine if the application was accurately denied or approved for free or reduced meals. The completed and reviewed applications will be maintained in a safe and secure location, so they are easily accessible in an instance where they would need to be referenced. Person responsible for implementation and projected implementation date: The Food Services Director and the Corporation Treasurer will implement the corrective action plan starting with applications received for the 2025-2026 school year.

Internal Control: When a purchase is made with any vendor over the $25,000 threshold from Fund #800, School Lunch, Fund, the superintendent along with the treasurer or deputy treasurer (minimum of two people) will require that any vendors selected are in compliance with the Procurement and Suspension and Debarment compliance requirements by completing one the of following quality checks with each vendor prior to purchase: a. Checking the federal System for Award Management (SAM) database at https://sam.gov/content/exclusions and maintain a screen shot of the search results b. Collect a certification from the vendor directly c. Adda clause or condition to the covered transaction with the vendor

Name of contact person: Mr. Joseph Gudac, Business Manager Corrective Action: We will follow our policy for ensuring the accuracy of meal counts before remitting the total meals to PDE. The district will implement a pre-submission review protocol to verify that monthly claims accurately reflect the meals served to eligible students. We also will develop a standardized checklist for reviewing and approving meal counts before submission and to ensure that discrepancies identified during review are promptly investigated and corrected. Anticipated Completion Date: The District will implement the above procedure immediately.

1. The District has consulted with the Arkansas Division of Elementary and Secondary Education, Child Nutrition Unit (DESE, CNU) for guidance and technical assistance. 2. Per CNU guidance, the District is in the process of submitting an amended claim for October 2023 to correct the $552 discrepancy. We anticipate acceptance of this claim, resolving the issue. 3. The District has fully implemented the required CEP compliance procedures and has trained personnel to ensure future claims adhere to federal and state regulations. 4. Standard Operating Procedures (SOP) for the Child Nutrition Program have been updated to prevent recurrence of this issue. The Earle School District is committed to ensuring full compliance with all federal and state regulations regarding Child Nutrition reimbursement claims. We appreciate the guidance provided by DESE, CNU and will continue to implement measures that strengthen our oversight and accountability.

Finding 2024-004 Reporting – Noncompliance and Significant Deficiency in Internal Control Over Compliance Corrective Action Plan This occurrence was due to a change in management and the error was corrected when it was identified. Since then, all the documentation was submitted within parameters of the grant. Expected Completion Date 12/21/2023

PDA, Bureau of Food Assistance (BFA) has already or will put the following steps in place to address this deficiency and noncompliance finding. 1. BFA will communicate to our contractor, Hunger-Free Pennsylvania, that all required uploads of information related to the Commodity Supplemental Food Program (CSFP) must be entered in PAMeals by the final day of the month following the program month (i.e., data from May must be entered by June 30, data from June must be entered by July 31, etc.). BFA will also implement a monthly check in PAMeals to occur on the 1st of each month, to ensure that data from the previous reporting period has been entered into PAMeals timely (i.e., data from May should be entered by July 1, data from June should be entered by August 1, etc.). 2. In response to finding 2023-004, BFA cross-trained the NSLP Specialist on the process of completing the Monthly Processor Reports (MPRs) as a back up to the NSLP Processing & Procurement Specialist. The NSLP Specialist was then tasked with completing a monthly review of the completed MPRs to ensure accuracy. BFA has now added an additional layer to the process, with the Assistant Bureau Director serving as a backup to the NSLP Specialist, to ensure that should there be a vacancy in either of the two NSLP positions, there will always be a primary and a back-up to ensure accuracy. 3. BFA will add a validation step to the Distributor data import process for PAMeals to flag and disallow any transactions that are dated prior to the current fiscal year. BFA will also put in place a warning system on PAMeals to flag incorrect dates in any manual adjustments. 4. To ensure that processor inventories are accurate, BFA has programmed PAMeals to run a weekly check (on Sunday) to ensure that beginning processor inventories entered match the previous month and to ensure that ending inventories are accurate. BFA staff are also completing a 6-month periodic processor inventory review to ensure that records are accurate. 5. To ensure correct and timely data submissions from Share Food Program, one of our two contract distributors, PDA will require them to implement a corrective action plan detailing their plans to ensure that they provide timely and accurate reporting. This CAP will help to ensure that correct transactions are posted to PAMeals in a timely manner and will aid in addressing the issues with SEFA submission. Anticipated Completion Dates: 1. 06/30/2025, 2. Completed, 3. 06/30/2025, 4. Completed, 5. 06/30/2025 Contact Name: Caryn Long Earl, Director, Bureau of Food Assistance

Information on the federal program : Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Context : For 18 selections, in a sample of 40 payroll transactions, the School Corporation based the employees’ time charged to the grant on an annual time and effort log. The employee’s time was split with a non-federal fund. The School Corporation allocated the employee’s time based on a time and effort log completed in September of each year which was reviewed by the Superintendent. The School Corporation did not complete time and effort logs more frequently than annually to ensure the amounts being charged to food service were based on worked performed for each payroll period. Contact Person Responsible for Corrective Action: Candace McDonald Contact Phone Number: 765-734-1261 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Instead of doing a time study, we will fully implement an analysis of percentages paid by the school lunch program on a monthly basis. Anticipated Completion Date: Beginning of April 2025, fully implemented and corrected by the end of May 2025.

FINDING 2024-004 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Finding: Material Weakness Contact Person Responsible for Corrective Action: Contact Phone Number: • Jill Pollard, 765-654-4473, ext 401 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: • There will be dual control on all applications Anticipated Completion Date: • 12/31/2025

FINDING 2024-003 Information on the federal program: Subject: Child Nutrition Cluster - Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2023, FY2024 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Context: Crowe noted there was no review of all 35 timecards selected for testing in a sample of 40 payroll transactions. The other 5 sample payroll transactions for salaried employees were tested without error. Contact Person Responsible for Corrective Action: Contact Phone Number: • Linda Burkhalter, 765-659-1339, ext 113 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: • We will have dual control on all timesheets. Anticipated Completion Date: • 3/17/2025

Corrective Action Plan: The Division will implement a review process to ensure the accuracy of the inventory management and reporting process. Anticipated Date: April 2025 Name of Person Responsible for Implementation: Al Agpoon, Controller

FINDING: 2024-003 Finding Subject: Child Nutrition Cluster - Suspension and Debarment Contact Person Responsible for Corrective Action: Kimberly Baumgartner Contact Phone Number and Email Address: 260-636-2175 baumgartnerk@centralnoble.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The School Corporation will review its internal control process for checking if a vendor is suspended or debarred prior to doing business with that vendor. All future expenditures triggering suspension and debarment requirements will include implementing the following procurement policies. The Business Manager will initial the supporting documentation for verifying a vendor to provide proof of compliance. Reference Suspension and Debarment Standards 2 CFR 180.300 Districts may not enter into contracts with entities that have been suspended or debarred from participating in contracts with federal funds. For contracts over $25,000, districts must verify a contractor is not excluded or disqualified. Contractors must be verified in one of three ways: 1. Checking the System for Award Management (SAM) (www.SAM.gov) 2. Collecting a certificate from that contractor. 3. Adding a clause or condition to the covered transaction with that contractor. (Recommended) Anticipated Completion Date: July 2025

FINDING 2024-005 Subject: Child Nutrition Cluster –Reporting Audit Finding: Material Weakness, Modified Opinion Contact Person Responsible for Corrective Action: Linda Zaborowski, CFO Contact Phone Number and Email Address: (219) 881-5536 lzaborowski@garycsc.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: Gary Community School Corporation (GCSC) is taking immediate action to strengthen internal controls over meal count reporting. The district will fully utilize the Skyward Student Information System to track all meals, including those processed through the Point of Sale (POS) system and a la carte items, ensuring a standardized process across all schools. To improve accuracy and prevent over-claiming, GCSC is implementing a unique student ID system where each student will either scan their ID card or manually enter their assigned ID number when receiving a meal. The CFO/Food Service Director will conduct daily reconciliations of meal counts with the Food Service Management Company (FSMC) and verify all claims against source records to prevent errors. Monthly claims will be reviewed for accuracy, ensuring that second student meals and staff meals are excluded. Additionally, GCSC will establish clear policies and procedures requiring the FSMC to provide complete and accurate data for all claim submissions. Regular internal audits and staff training will be conducted to enforce compliance, and an oversight process will be implemented to detect and correct discrepancies before submission. Anticipated Completion Date: Gary Community School Corporation will implement this procedure by March 2025.

FINDING 2024-004 Finding Subject: Child Nutrition Cluster –Procurement and Suspension and Debarment Cost Principles Summary of Finding: Material Weakness, Modified Opinion Contact Person Responsible for Corrective Action: Linda Zaborowski, CFO Contact Phone Number and Email Address: (219) 881-5536 lzaborowski@garycsc.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: To address the deficiencies in procurement and suspension and debarment compliance, the Gary Community School Corporation will implement a comprehensive internal control system. The School Corporation will establish and enforce policies and procedures to ensure that all invoices submitted by the Food Service Management Company (FSMC) accurately reflect the amounts paid by the FSMC. A structured process will be developed to verify that all invoices include the required documentation for discounts, rebates, and applicable credits. To ensure compliance, the School Corporation will require the FSMC to submit detailed documentation supporting all invoices, including proof of payment and a breakdown of any credits. The Business Office Coordinator will be responsible for reviewing and reconciling these invoices before they are approved for payment by the CFO/Food Service Director. The CFO/Food Service Director will oversee this process, and conduct regular reviews to confirm that all financial transactions adhere to procurement regulations. Additionally, the School Corporation will implement a formalized training program for procurement staff, focusing on federal and state procurement regulations, including invoice verification and compliance with suspension and debarment requirements. Anticipated Completion Date: Gary Community School Corporation will implement this procedure by July 2025.

FINDING 2024-003 Finding Subject: Child Nutrition Cluster – Activities Allowed or Unallowed, Allowable Costs/Cost Principles Summary of Finding: Material Weakness, Modified Opinion Contact Person Responsible for Corrective Action: Linda Zaborowski, CFO Contact Phone Number and Email Address: (219) 881-5536 lzaborowski@garycsc.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: Gary Community School Corporation is committed to strengthening internal controls to ensure compliance with federal regulations governing the Child Nutrition Cluster programs. To address the deficiencies identified in the audit, we will implement a structured system for reviewing and approving all financial transactions related to the food service program. Moving forward, all invoices submitted by the Food Service Management Company (FSMC) will require detailed supporting documentation before payment is processed. The Food Service Director will conduct thorough reviews to verify the accuracy and allowability of costs, ensuring that only eligible expenses are charged to the program. Additionally, a standardized checklist will be developed to confirm compliance with federal cost principles. To address payroll-related deficiencies, all employees whose salaries are funded by the Child Nutrition Cluster will be required to maintain detailed time and effort records that document their work on federal and non-federal activities. The Payroll Department will not process payments from federal funds without proper documentation, and approval from the CFO/Food Service Director. To prevent future occurrences of questioned costs, the Business Office Coordinator will carefully review all FSMC invoices to verify that adequate documentation is provided, and any unallowable costs, including sales tax, are identified and excluded before payment is made. Moving forward, internal procedures will include a detailed verification process to ensure that only allowable costs are charged to the program. Anticipated Completion Date: Gary Community School Corporation will implement this procedure by July 2025.

Finding 2024-003 Finding Subject: Child Nutrition Cluster - Eligibility Contact Person Responsible for Corrective Action: Kelsey Rodriguez and Beverly Hindes Contact Phone Number: 574-229-2209 and 219-996-4771 x128 Views of Responsible Officials: We agree with the finding. Description of Corrective Action Plan: The Treasurer will ensure compliance with the Food Service Director (NIESC) Kelsey Rodriguez, with the student determination guidelines to receive free or reduced priced meals. The designee will review and sign off. Additionally, all documentation will be maintained. Anticipated Completion Date: March 31, 2025

MMUUSD Preliminary Corrective Action Plan (Concerning Finding 2024‐001; Activities Allowed and Allowable Costs) Contact Person Responsible for Corrective Action: Nicole Fortier, Director of Finance and Operations Corrective Action: During our audit there was one instance identified where MMUUSD overpaid an employee under the Food Service program at a rate of pay different than the stated rate for a Food Service Substitute. To be more specific, the Food Service substitute rate was transposed and the employee was paid $16.62 ($0.10 more) instead of the stated substitute rate of $16.52. The first step in our corrective action plan was a review with our Senior Payroll Specialist of the error, and to reiterate the importance of verifying the correct hourly rate being input for our substitutes. This step has already been completed. Additionally, we are in the process of implementing a more thorough payroll review process, which will include a preliminary review by Christal Clark, Accountant in the Business Office. Given that the payment of substitutes is such a manual process and we cannot utilize our employee timesheet software for paying them, we will also perform periodic reviews of all substitute payments to verify that the rate of pay is in line with the Sub Pay agreement for that respective Fiscal Year. If any discrepancies are noted, the employees will be made whole ASAP. We are currently performing periodic reviews of all substitute payments to verify the correct rate of pay is being used as of January 2025. We are in the process still of developing a payroll review process that works for us and is efficient. With Christal Clark being more involved in the payroll process on a biweekly basis, we are assessing whether this should be a post‐payroll review or mid‐payroll review. Anticipated Completion Date: 07/01/2025