Corrective Action Plans

Finding 2024-005 Department of Agriculture Federal Financial Assistance Listing 10.553/10.555/10.559 Child Nutrition Cluster Activities Allowed or Unallowed; Allowable Costs and Cost Principles Material Weakness in Internal Control over Compliance Finding Summary: During the course of the engagement, Eide Bailly LLP noted two instances where the employee salaries did not align with their rate of pay noted in their contract. Responsible Individuals: Brian Korf, Superintendent Corrective Action Plan: A thorough review and reconciliation of supporting documentation for expenditures, including payroll transactions, should be performed before amounts are disbursed. Supporting documentation should be maintained once review is documented and preformed. Anticipated Completion Date: June 30, 2025

The School agrees to solely use the food service bank account for all revenues and expenses related to the food service program. As of yearend the School has completed the process of transitioning bank information to respective vendors and governmental agencies to ensure the monies received for the food service program are deposited into the account and expenses for the food service program are paid out of this account.

The School agrees to solely use the food service bank account for all revenues and expenses related to the food service program. As of yearend the School has completed the process of transitioning bank information to respective vendors and governmental agencies to ensure the monies received for the food service program are deposited into the account and expenses for the food service program are paid out of this account.

Re: Corrective Action Plan for Findings Related to Monthly Claims for Reimbursement and Free/Reduced Meal Applications In response to the findings regarding the District's internal controls over monthly meal count reporting, Claims for Reimbursement, and the review of Free and Reduced Meal applications, Hannibal School District 60 has developed the following Corrective Action Plan (CAP) to address the identified issues and ensure compliance with federal regulations under 7 CFR 210.B(a), 7 CFR 220.11(c), and 7 CFR 245.6(c)(4). Corrective Action Plan Details: 1. Finding 1: Lack of Oversight on Monthly Claims for Reimbursement Condition: The District did not conduct a review of monthly Claims for Reimbursement before submission to the Department of Elementary and Secondary Education (DESE), nor was a subsequent review performed after submission. Additionally, the Claims for Reimbursement for February and April were submitted with the lunch and breakfast meal counts incorrectly switched. Planned Actions: o Review Process for Claims: The District will establish a clear and documented procedure for reviewing the monthly Claims for Reimbursement before submission to DESE. This process will include a verification checklist to confirm the accuracy of meal counts for both breakfast and lunch. o Secondary Review by Senior Staff: A second, independent review will be conducted by the Food Service Supervisor or another designated senior staff member before submission. The purpose of this review will be to ensure that meal counts are correctly reported and to identify any discrepancies before the claims are submitted. o Training: All staff involved in the preparation and submission of monthly meal claims will undergo additional training on the accurate completion of meal count reports and claims for reimbursement. 2. Person(s) Responsible: o Food Service Director: Oversee the implementation of the new review procedures for monthly Claims for Reimbursement. o Food Service Supervisor: Conduct a secondary review of the monthly meal count reports before submission. 3. Anticipated Completion Date: The review procedures and training will be fully implemented by January 1st, 2025 4. Finding 2: Inadequate Review of Free and Reduced Meal Applications Condition: During testing, it was noted that one app.lication had illegible numbers, resulting in unclear income figures. The household was assumed to be eligible for free meals, but the accuracy of the income figures was not verified, which could have led to improper eligibility determination. Planned Actions: o Review and Verification Process: The District will implement a formal review process to ensure that all Free and Reduced Meal 58 applications are thoroughly checked for legibility and accuracy. This review will include verifying income calculations and ensuring that illegible numbers or unclear data are clarified before eligibility determinations are made. o Enhanced Application Procedures: A standardized checklist will be developed for reviewing applications, with specific attention to legibility, accuracy, and completeness. The checklist will be used by staff during the application review process. o Follow-up with Households: If any data on an application is unclear or illegible, the District will contact the household to clarify the information before proceeding with the eligibility determination. o Training: The Food Service Director and application review staff will receive training on the proper review and verification of Free and Reduced Meal applications, including the importance of ensuring that all information is clear and accurate. 5. Person(s) Responsible: o Food Service Director: Oversee the review and verification process for Free and Reduced Meal applications. o Food Service Staff: Review applications for legibility and accuracy, and follow up with households if necessary. 6. Anticipated Completion Date: The new review process and training will be fully implemented by January 1st, 2025 7. Cause of Findings: The primary cause of these findings was the misinterpretation of handwritten reported income by the applicant and a mix-up of breakfast and lunch counts during the reporting of Free and Reduced meal counts for one school over the course of a few months. 8. Effect of Findings: Without a robust review process in place, there is a risk of submitting inaccurate meal count data and miscalculating eligibility for free and reduced meals. This could result in the District receiving either too much or too little funding from DESE, affecting the financial stability of the program. Additionally, failure to ensure accurate eligibility determinations could result in noncompliance with federal regulations, potentially leading to penalties or loss of funding. Implementation and Monitoring: • Ongoing Monitoring: The Food Service Director will regularly monitor the new procedures to ensure they are being followed correctly and will conduct random spot checks of meal counts and application reviews to ensure compliance. • Reporting: The Food Service Director will report on the status of the corrective actions to the Superintendent on a monthly basis until the corrective actions are fully integrated into the District's operational processes. We are committed to ensuring the accuracy and integrity of our meal count reporting and eligibility determinations. The District will implement these corrective actions in a timely manner to address the identified findings and ensure compliance with applicable federal regulations. If you have any questions or require further details, please do not hesitate to contact me. Sincerely, Susan Johnson Superintendent of Schools Hannibal School District #60

MATERIAL WEAKNESS 2024-005 Child Nutrition Cluster – Assistance Listing Number 10.553 and 10.555 Nonprofit school food service fund Recommendation: Internal controls for accounting for nonprofit school food services funds should be implemented. A separate class in the accounting software should be utilized. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: One City Schools did improve their accounting procedures in 2023-24 to begin using separate classes for food expenses and revenues. To further implement best practice One City Schools is utilizing guidance from DPI to identify and account for program versus nonprogram foods to ensure there is no unallowed profit made off the program. Written policies and procedures are being drafted and will be implemented. Name(s) of the contact person(s) responsible for corrective action: Janel Vertz, Finance Director Planned completion date for corrective action plan: June 2025 (with all fiscal year 2024-25 revenues and expenses retroactively evaluated and appropriately accounted for).

MATERIAL WEAKNESS 2024-004 Child Nutrition Cluster – Assistance Listing Number 10.553 and 10.555 Claiming Review Recommendation: One City Schools should implement appropriate internal controls for reviewing funding claims prior to submission. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: One City Schools did improve their claims procedures in 2023-24. To further implement best practice, policies related to federal claims reviews were incorporated into the Federal Grants Procedural Manual. One City Schools also utilized guidance from DPI to implement meal counting and claiming policies and procedures including counting reimbursable meals, performing edit checks of counts, submitting site-based claims, and retaining appropriate documentation. Name(s) of the contact person(s) responsible for corrective action: Janel Vertz, Finance Director Planned completion date for corrective action plan: Completed

MATERIAL WEAKNESS 2024-002 Child Nutrition Cluster – Assistance Listing Number 10.553 and 10.555 Procurement Recommendation: We recommend that the Organization establish and maintain effective internal controls over procurement requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: One City Schools adopted a procurement policy in November 2023 that, if followed, resolves this finding. A new primary food vendor was selected in summer of 2024, and the selection did adhere to the new procurement policy. This policy and all procedures were edited to be comprehensive of all uniform grant requirements through the development and adoption of the Federal Funds Procedural Manual. Name(s) of the contact person(s) responsible for corrective action: Janel Vertz, Finance Director Planned completion date for corrective action plan: January 2025

The Food Service Director will continue to review food service claim data, in addition to the claim preparer. Management has instituted a process whereby the Food Service Director will initial food service claim paperwork in order to document her review. The preparer of the claims will then also review the data before processing and submitting the claims. Person Responsible: Chris Petersen, Superintendent Anticipated Completion Date: Ongoing

The District will improve internal controls by incorporating the involvement of a grant manager who is knowledgeable of grant requirements to approve expenditures.

The District will improve internal controls by incorporating the involvement of a grant manager who is knowledgeable of grant requirements to approve expenditures.

To Whom it may concern: This document serves as the response to the 2023-2024 Financial Audit on behalf of BELIEVE Schools, Inc. We’ve identified and addressed the comments that were included in the Uniform Guidance Major Program Findings. Please review the corrective action items in response to the Audit Results and Comments: Education Stabilization Fund (ESSER Grant): The school was unable to provide construction contracts to allow auditors to verify that the required Davis-Bacon Act wording was included. ● The Principal, Angel Jackson-Anderson, and Dean of Operations, Kayla Marshall, will ensure that the proper contracts are received and filed for all services conducted under ESSER grants. Child Nutrition: The school did not maintain tally sheets to support the number of meals served. ● The Dean of Operations, Kayla Marshall, will ensure that the proper physical files (tally sheets) are maintained and filed monthly, both in digital and paper form. The principal will review these files monthly to ensure documents are not lost or misplaced. If you have any questions, concerns, or comments, please feel free to contact me the school principal, Angel Jackson-Anderson, Aanderson@believeschools.org. Many thanks, Angel Jackson-Anderson Principal, BELIEVE Circle City High School Kayla Marshall Dean of Operations, BELIEVE Circle City High School www.believeschools.org @believeschoolsindy admin@believeschools.org 317-296-1954 Angel Jackson-Anderson 11/07/2024 02:25PM UTC

A. Revise and Strengthen Processes 1. New Software Implementation: o Replace the previous software program with a more reliable system. 2. Process Realignment: o Redefine staff roles to ensure clear responsibilities for eligibility determinations and reviews. B. Establish and Strengthen Internal Controls 1. Eligibility Review: o DeAnn Gould, Federal Programs & Grants Coordinator, and Howard Carpenter, Director of Operations, will oversee eligibility determinations using the updated software and Attachment A for reference. o Conduct a second review of all applications to verify accuracy and compliance with eligibility criteria. 2. Regular Edit Checks: o Implement weekly edit checks in the Point of Service (POS) system to confirm correct benefits distribution. C. Staff Training 1. Regular Food and Nutrition Services (FNS) Training: o Conduct quarterly training sessions on eligibility criteria, compliance requirements, and internal control processes. o Include hands-on training for using the new software and reviewing Attachment A criteria. 2. Compliance Assessments: o Assess staff understanding post-training to identify additional support needs. D. Monitoring and Evaluation 1. Audit Schedule: o Conduct monthly internal audits to evaluate compliance and report findings to leadership. 2. Performance Metrics: o Track error rates in eligibility determinations and aim for a significant reduction by June 30, 2025. E. Addressing Questioned Costs 1. Reconciliation Plan: The Missouri Department of Elementary and Secondary Education (DESE) has informed the School that the questioned costs of $20,578.74 will be withheld from future Food Service payment requests. The School will work with DESE to ensure proper adjustments and compliance with this reconciliation plan. 2. Process Transparency: Documentation of the withholdings and their impact on future payments will be maintained and reviewed to confirm accurate reconciliation of the overclaimed amount.

Name of Contact Person Travis Sweeney, SFO Business Manager Corrective Action The Business Manager and/or Superintendent will verify the eligibility information for future Title I grants prior to submitting the annual application. District Business Manager, Travis Sweeney, will obtain documentation on an annual basis that the eligibility is true and correct and the information input into the application will match the information within the District's student information system (Infinite Campus). Proposed Completion Date Fiscal year ended June 30, 2025

Corrective Action Plan: The District will ensure applications are completed and eligibility correctly assessed. Contact Information: For additional information regarding this finding please contact Ryan Bandt, Director of Business Services, at 920-675-1044.

ACTION STEPS: Every effort will be made to ensure payments are made in a timely manner while getting board approval. In the event that an invoice is received after the monthly board meeting, the bill will be included on the next month's Bills Payable Report even if the payment has already been made. CONTACT PERSON: Dr. Lori James-Gross, Superintendent ANTICIPATED COMPLETION DATE: September 1, 2024

2024-007 – Child Nutrition Cluster – Eligibility - The District is aware of the missing eligibility documents for the Child Nutrition program and will implement new procedures and a plan to reduce the missing documentation. Responsible Officials – Joe Dawidziak, Superintendent Anticipated Completion Date – The District will correct this in the subsequent fiscal year.

Findings #2024-003 and #2024-006 – Significant Deficiency - Other. Federal programs: U. S. Department of Agriculture, Passed through Texas Department of Agriculture, 10.553/10.555, Child Nutrition Cluster, Contract #’s: 202323N109946, 202424N109946 and 236TX400N8903. U. S. Department of Education, Passed through Texas Education Agency, 84.010, Title I Grants to Local Educational Agencies, Contract #’s: 23610101108807 and 24610101108807, 84.367, Supporting Effective Instruction State Grants, Contract #’s: 23694501108807 and 24694501108807. Condition and context: During our testing of the payroll control reviews by the accounting, compensation, and benefits departments, we identified 1 of 40 payroll cycles tested was not reviewed by the compensation and benefits departments. The payroll cycle was reviewed by the accounting department. Recommendation: Reemphasize current policies and procedures to ensure proper review of the payroll by compensation and benefits departments, including subsequent review if out on holiday to ensure that errors are identified in a timely manner. Planned corrective action: IDEA requires review of each payroll by the Compensation and Benefits team without regard to school holidays. In fiscal year 2025, Payroll implemented the procedure requiring review from compensation and benefits immediately following a school holiday where payroll could not be approved in advance. Responsible officers: Sonya Wilson, VP of Accounting and James Dworkin, VP of Accounting (Interim). Estimated completion date: January 31, 2025.

Findings #2024-002 and #2024-005 – Significant Deficiency and Other Non-Compliance - Reporting. Federal programs: U. S. Department of Agriculture, Passed through Texas Department of Agriculture, 10.553/10.555, Child Nutrition Cluster, Contract #’s: 202323N109946, 202424N109946 and 236TX400N8903. U. S. Department of Education, Passed through Texas Education Agency, 84.010, Title I Grants to Local Educational Agencies, Contract #’s: 23610101108807 and 24610101108807, 84.367, Supporting Effective Instruction State Grants. Contract #’s: 23694501108807 and 24694501108807. Condition and context: During our testing of GAAP and FASRG coding, we identified 4 of 200 payroll transactions coded to the incorrect function code and 3 of 120 non-payroll transactions coded to the incorrect object code. Additionally, during our testing of non-payroll transactions, we identified 3 of 120 nonpayroll transactions coded to the incorrect fiscal year. Recommendation: Reemphasize current policies and procedures to ensure proper coding of disbursements based on the organization’s chart of accounts and FASRG codes. Planned corrective action: IDEA will provide FASRG training to all staff with purchasing and payroll coding authority to minimize coding errors. This training will be conducted from January to May 2025. Responsible officers: Sonya Wilson, VP of Accounting and James Dworkin, VP of Accounting (Interim). Estimated completion date: May 1, 2025.

Subject: Regarding Audit Finding 2024-003: Reporting (50000) Finding 2024-003: We agree with the auditor’s comments, and the following actions will be taken to ensure proper records are maintained and reconciled: 1. The District is working with the point-of-sale vendor to be able to add a separate afterschool snack meal schedule to our system to accurately record snacks served in real-time. This will replace hand-tallied counts and reduce the risk of mathematical errors 2. Staff will conduct daily reconciliation of snack counts in the point of sale system to ensure accuracy 3. Monthly audits will be performed in against claim forms in advance of reimbursement claims tha tare submitted to the California Department of Education 4. The point-of-sale system will support the District’s ability to maintain accurate records and reconciliations for compliance purposes. The above steps will be implemented by April 2025 and the District maintains that it will continue the actions above to follow Child and Adult Care Food Program, Child Nutrition Cluster guidelines.

Nutrition Cluster – CFDA Nos. 10.553 and 10.555 Significant Deficiency in Internal Controls over Compliance: See Find-ing 2024-001

Nutrition Cluster – CFDA Nos. 10.553 and 10.555 Name of contact person – Kimberly Russian, Business Manager Recommendation: We recommend the Food Service Director more closely review all meal count information entered for reimbursement pri-or to submitting each monthly claim to ensure accuracy and consistency with supporting documentation. We recommend that the Food Service Director review all monthly claims filed in fiscal year 2024-25 that are available for revisions, to ensure reports were accurately filed. Further, we recommend that District management periodically monitor claim submissions for accuracy. Action Taken: Management agrees with the recommendations. The Food Service Director has reviewed all monthly claims submitted in school year 2024-25 and found no errors requiring revision. Further, management will implement a plan to periodically review claim submis-sions for accuracy. Proposed Completion Date: January 31, 2025

Child Nutrition Cluster – Assistance Listing No. 10.553, 10.555, 10.559 Recommendation: Auditor recommends the District review its procurement process to ensure that there is adequate segregation of duties in regards to initiating, authorizing, reviewing for grant allowability and approving micro purchases, along with adding controls to ensure that the item purchased was received by the District. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We continue to look for ways to segregate duties and will improve on the review process for micro purchases but with the current financial situation, additional staff cannot be added. Name(s) of the contact person(s) responsible for corrective action: Lisa Miller Planned completion date for corrective action plan: Ongoing. If the oversight agencies have questions regarding this plan, please call Lisa Miller at 715-887-9000.

District Response and Corrective Action Plan: The Business Office will monitor the list at SAM.gov monthly and will check new vendors against the suspendered and debarment list. The District will not work with debarred vendors.

2024-001 - Nonmaterial Noncompliance - Eligibility Program: Child Nutrition Cluster (ALN 10.553 and 10.555) - United States Department of Agriculture; Federal Award Year: 2024 Responsible Officials: John Wack, Chief Financial Officer, Henrico County Public Schools Planned Corrective Action: School Nutrition Services Leadership has put a new process in place, to run a report from the point-of-sale system weekly, that will catch any "Manual" updates to lunch statuses. This report will be run weekly and verified by either the Dietitian or Controller. The report will be initialized and kept on file. Expected Completion Date: 12/31/24

Condition: The School District is required to account for all revenues and expenditures of its non-profit school food service account in accordance with state and federal requirements. In order to ensure that federal reimbursement payments received monthly from the Michigan Department of Education are correctly credited to the school food service account, monthly bank reconciliations should be prepared and reviewed by individuals with requisite skill and experience. During the 2024 fiscal year, bank reconciliations and monthly reconciliations of food service revenues and expenditures of the school food service account were not being prepared and reviewed in a timely manner. As there was an unexpected reduction in staff resources in the business office, there were not adequate resources to perform these accounting reconciliations on a timely regular basis during the year. The absence of these timely regular reviews could lead to undiscovered errors in the school food service account and material noncompliance with federal regulations. Planned Corrective Action: The School District agrees that its internal control structure should ensure that accounting reconciliations are prepared and reviewed in a timely manner during the year. Although the School District had an intergovernmental Agreement with its Intermediate School District to provide business services, such services could not be rendered due to inability to find staffing. Near the end of the 2024 fiscal year, a Finance Director was directly hired into the business office. Monthly reconciliations of accounting records and closing of monthly books are now being performed and reviewed on a timely basis. Contact person responsible for corrective action: David Bergeron, Assistant Superintendent Anticipated Completion Date: July 1, 2024