Corrective Action Plans

Finding - The School District’s net cash resources exceeded 3 months average expenditures for its nonprofit school food service. Recommendation - That the School District ensure that its net cash resources does not exceed 3 months average expenditures for its nonprofit school food service. Method of Implementation - Ensure the accounting in the enterprise fund will be monitored. In addition, the District plans to utilize the excess funds to upgrade kitchen appliances. Person Responsible for Implementation - School Business Administrator Implementation Date - March 1, 2024

Finding - The food service daily meal count report did not agree with the School District’s edit check worksheets that detail the number of meals served and provides the number of meals used to determine the amount of Federal reimbursement. Recommendation - That the School District’s food service daily meal count reports agree with the edit check worksheets in an effort to request the appropriate amount of Federal reimbursement. Method of Implementation - Review and enhance internal controls from prior administration, including an implementation of procedures that align to the recommendation. Person Responsible for Implementation - School Business Administrator Implementation Date - March 1, 2024

Finding - The documentation related to the School District's verification report was not available for audit. Recommendation - That the School District ensure that proper supporting documentation of verification is maintained. Method of Implementation - Review and enhance internal controls from prior administration. Person Responsible for Implementation - School Business Administrator Implementation Date - March 1, 2024

Name of Auditee: City School District of Albany Name of Audit Firm: EFPR Group, CPAs, PLLC Period Covered by the Audit: Year ended June 30, 2023 CAP Prepared by: Joseph Karas, Assistant Superintendent for Business and Finance Phone: 518-475-6022 (A) Current Finding on the Schedule of Findings and Responses (3) Audit Finding 2023-003 (a) Comments on the finding and recommendation: The District agrees with the finding. The District also agrees with the recommendation. See below for actions taken. (b) Actions Taken: Management will reconcile significant asset and liability accounts, including state and federal receivables, at year end to ensure accounting records accurately reflect appropriate balances. (c) Anticipated Completion Date: Management anticipates this finding will be resolved by June 30, 2024.

FINDING 2023-003 Finding Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Summary of Finding: Condition and Context Direct charges to a federal award are to be for allowable costs and made in conformance with the applicable cost principles. Payroll benefits were entered by the payroll department and reviewed by the Payroll Coordinator to ensure proper payment. However, this review was not completed on a detailed level by employee to ensure the payroll withholdings, deductions, and benefits retained from employees’ wages were for allowable costs and made in conformance with applicable cost principles. The lack of internal controls was a systemic issue throughout the audit period. Contact Person Responsible for Corrective Action: Dr. Thomas A. Keeley, Executive Director of Business Services Contact Phone Number and Email Address: (574) 258-9591 Tkeeley@phm.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The school corporation will revise job descriptions to clearly identify tasks and responsibilities for the payroll process. The school corporation will print a detailed employee wage report for each payroll with double signatures indicating a thorough review process by the payroll coordinator and the payroll accounting specialist/Food Service Manager. Finally, the Executive Director for Business Services will complete noting a final review of corresponding benefits withholdings to the corresponding vendor payments indicating the process is complete with an official signature. Anticipated Completion Date: March 1, 2024.

2023-004 Child Nutrition Cluster – 10.555 – National School Lunch Program, 10.559 – Summer Food Service Program for Children, 10.553 – School Breakfast Program – Procurement, Suspension, and Debarment Condition One procurement was tested for the Food Service Program, and it was found to not have followed the District’s procurement plan. Recommendation The District should ensure that it follows its procurement policy for all applicable transactions. Comments on the Finding The District is aware of the oversight and has implemented procedures to prevent this, in the future. Actions Taken As of the date of this notice, staff involved with this procedure have undergone training through KASB and KSDE and have added the procedure of verifying quotes to ensure the procurement plan is followed to a monthly checklist to ensure that it occurs timely.

Finding 2023-003 – Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Michelle Babcock Contact Phone Number: 317-392-2505 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: We have already established an improved internal controls procedures for procurement. We have established a checklist process to ensure the Suspension and Debarment Check has been completed for all federal purchases over the threshold. Anticipated Completion Date: October 2022

Finding 2023-002 – Child Nutrition Cluster - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Contact Person Responsible for Corrective Action: Michelle Babcock Contact Phone Number: 317-392-2505 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: We have established an improved internal controls procedures with internal purchases. The items requested will be submitted in writing and when the items are delivered to the perspective department or building, a signature will be obtained to confirm the items were delivered internally before the funds will be transferred to/from the respective accounts. Anticipated Completion Date: January 2024

Condition: The District did not select and verify the required sample of approved free and reduced price applications by the required deadline. Plan: The district will have a calendar reminder to begin auditing applications on Oct. 1 and complete the process with submission to ISBE by December 15. Anticipated Date of Completion: 12/31/2024 Name of Contact Person Yasmine Dada, Business Manager ________________________________________________

Views of responsible officials and Corrective Action Plan: Management of the School has noted the 2 CFR Section 200.320 to ensure that the procurement requirements are met.

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Eligibility Summary of Findings: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Eligibility compliance requirement. The free and reduced-price applications were completed online by the applicants, and the information was automatically uploaded into the School Corporation's nutrition program software system. The software system then calculated the student's eligibility for free and reduced-price meals based on the parameters in the system. There was no documented oversight, review, or approval process to ensure the parameters in the system were correct and that the eligibility determination made complied with the requirements of the programs. The lack of internal controls was a systematic issue throughout the audit period. Contact Person Responsible for Corrective Action: Julie Dudley Contact Phone Number and Email Address: 812.537.7205 jdudley@lburg.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director and Business Manager have added the verification of every 30th Free/Reduce application that is submitted during the school year to their monthly checklists. Beginning with the 2024-25 school year, the Food Service Director will enter the eligibility parameters into the school nutrition software. Once entered the Food Service Director will provide a copy of the prices entered into the system to be reviewed and approved by the Business Manager or Superintendent. Anticipated Completion Date: January 2024/July 2024

Specific corrective action plan for the finding: Carol Gonzales, Finance Director will make sure that the required reporting information is submitted to the federal audit clearinghouse by the deadline of March 31st. Timeline for completion of corrective action plan: March 31st of 2024 or earlier Employee positions(s) responsible for meeting the timeline: Carol Gonzales, Finance Director

Auditors’ Recommendation: We recommend that as part of preparing monthly bank reconciliations, the reconciliation with the balance from the general ledger should be performed. Any differences should be immediately investigated and corrected. Once completed, the reconciliation should be reviewed by someone independent of the preparer. Both, the individual preparing and reviewing the bank reconciliations should sign or initial and date the reconciliation when completed. We recommend that the District incorporate procedures to ensure that such general ledger accounts are reconciled on a monthly basis. It is important that a dual accounting system is utilized in each individual fund and transactions between funds should be booked through the interfund receivables and payables. School District’s Response: Penny Crowell, Business Manager will ensure that bank reconciliations are prepared on a timely basis throughout the year, which includes a reconciliation to the general ledger. The District will have the Superintendent review bank reconciliations. Once completed, the preparer and reviewer will sign and date each reconciliation to evidence their completion. Lastly, the District will reconcile due to/due from accounts on a monthly basis. These processes will take place during the year ending June 30, 2024.

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Verification of Free and Reduced Price Lunch Applications Summary of Finding: Management had not developed or implemented a system of internal control that would have ensured compliance with requirements related to the grant agreement and Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirements. The failure to establish an effective internal control system placed the School Corporation at risk of noncompliance with the grant agreement and Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirements. A lack of segregation of duties within an internal control system could also allow noncompliance with compliance requirements and allow the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the program. We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and Special Tests and Provisions - Verification of Free and Reduced Price Applications (NSLP) compliance requirements. Contact Person Responsible for Corrective Action: Andrea Miller Contact Phone Number and Email Address: 765-564-2100, millera@delphi.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director or Assistant will review the applications, the other will do a second review. The Food Service Director and Assistant sign each application that is verified to ensure all information is accurate and the eligibility status is correct in Skyward. If additional verification information is provided, it will be documented and recorded in the binder with the applications. Anticipated Completion Date: August 2024

FINDING 2023-003 Finding Subject: Child Nutrition Cluster - Eligibility Summary of Finding: The School Corporation's management had not developed a system of internal controls that would have ensured compliance with the Eligibility compliance requirements. The failure to establish an effective internal control system places the School Corporation at risk of noncompliance with the grant agreement and the Eligibility compliance requirements. A lack of segregation of duties within an internal control system could also allow noncompliance with compliance requirements and allow the misuse and mismanagement of federal funds and assets by not having proper oversight, reviews, and approvals over the activities of the program. We recommended that the School Corporation's management establish a system of internal controls, including segregation of duties, related to the grant agreement and the Eligibility compliance requirements listed above. Contact Person Responsible for Corrective Action: Andrea Miller Contact Phone Number and Email Address: 765-564-2100, millera@delphi.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director or Assistant will enter online and paper applications, the other will review the entries compared to the applications, and both will sign off the applications. An additional selection will be added in Skyward to document which type of classification. A legend for the codes will be kept in the front of the binder where the applications are kept for reference. Anticipated Completion Date: August 2024

FINDING 2023-004 Finding Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Summary of Finding: Management had not developed an effective system of internal control that would have ensured compliance with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. The failure to establish an effective internal control system enabled noncompliance to go undetected. Noncompliance with the grant agreement and the compliance requirement could have resulted in the loss of funds to the School Corporation. We recommended that the School Corporation's management establish an effective system of internal control to ensure compliance and comply with the grant agreement and the Allowable Costs/Cost Principles compliance requirement. Contact Person Responsible for Corrective Action: Andrea Miller Contact Phone Number and Email Address: 765-564-2100, millera@delphi.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: A price list will be requested from vendors (GFS/Piazza) twice a month to reflect current pricing, and reports will be filed by school year by the Food Service Director for reference. The Food Service Director or Assistant will sample items that have been purchased and compare them to the pricing listing to verify accuracy. Anticipated Completion Date: August 2024

Findings and Questioned Costs Related to Federal Awards Finding Number: 2023‐001 Program Name/Assistance Listing Title: Child Nutrition Cluster Assistance Listing Numbers: 10.553, 10.555, 10.559 Contact Person: Krystal Burnham, Food Service Compliance Coordinator/ Danny Robbins, Interim Director of Budget and Finance Anticipated Completion Date: July 31, 2023 Planned Corrective Action: The District will ensure that monthly counts are supported by documentation and verified by a second staff member and agree to the accuracy of the reimbursement claims prior to submission to the Arizona Department of Education. The District will also ensure that reimbursement claims are submitted within the required time period after month end and any identified issues with measures that prevent their recurrence.

The filing of the Data Collection Form will be submitted by the required due date. In the prior year, the audit report was submitted after the Federal Audit Clearinghouse deadline. The current audit will be submitted with sufficient time to meet the Federal Audit Clearinghouse submission date requirement. Responsible party(ies) for corrective action(s): Chief Financial Officer Corrective action(s) timeline: March 15, 2024

The District has taken remedial actions to reduce net cash resources the Food Service Fund including the purchase of updated cafeteria equipment, service vehicles and brand new cafeteria tables for the High School. Additionally, the District plans to request additional staffing and more diverse menu items to suuplement the food service program.

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 10.556 2023-003 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, 2024. 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.

Corrective Action Plan: All borrowed cash has been transferred back to proper accounts. Journal entries and bank transfers shown above. District Administration will assess staffing needs to determine separation of duties and to determine additional staffing needs to meet the requirements of duty separation in connection with the reconciliation process. Currently, the Finance Department consists of one Payroll/Benefits position, one Accounts Payable/Receivable Position, one Grants Specialist Position, and one Finance Director. In prior years, the Finance Department had two additional positions that have since been eliminated, causing position duties to be absorbed amongst the remaining staff. Anticipated Completion Date: March 29, 2024

Corrective Action Plan: Reimbursement of Department of Agriculture cash has been completed for year-end 2022-2023. District Administration will assess staffing needs to determine separation of duties and to determine additional staffing needs to meet the requirements of duty separation. Currently, the Finance Department consists of one Payroll/Benefits position, one Accounts Payable/Receivable Position, one Grants Specialist Position, and one Finance Director. In prior years, the Finance Department had two additional positions that have since been eliminated, causing position duties to be absorbed amongst the remaining staff. Journal postings to reimburse shown below. Anticipated Completion Date: March 29, 2024

Management's Response: We concur. View of Responsible Officials and Corrective Action Plan In the 2023-24 school year, Nutrition Services has implemented an additional step when processing meal applications to improve accuracy. Meal applications are verified a total of three times. The Nutrition Specialist is the Determining Official, the Director is the Confirming Official, and either the Secretary or Clerk is the Verifying official. Each official reviews the application for accuracy. Name of responsible individual: Brenda Zarate Implementation Date: 7/1/2023

TRANSPARENCY ACT REPORTING Department of Education (DOE) Assistance Listing Number 10.553, 10.555, 10.556, 10.559, 10.582 Setting up a process to comply with the FFATA reporting requires retrieving information from multiple systems. In addition, child nutrition reimbursements are more complex than grants that have a known subrecipient amount. Due to the complexity, DOE is relying on guidance from the USDA to complete reporting procedures. DOE is currently waiting to get answers to several questions that are preventing full development of a process. USDA is also working to help DOE find another state agency that can help with unanswered questions. A FFATA reporting process is anticipated to be in place by July 1, 2024.

FINDING 2023-002 Subject: Child Nutrition Cluster – Suspension and Debarment Summary of Finding: The School Corporation did not verify vendor suspension and debarment status prior to payment. Recommendation We recommended that management of the School Corporation establish a system of internal and develop policies and procedures to ensure contractors and subrecipients, as appropriate are not suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Contact Person Responsible for Corrective Action: Casey Howard Contact Phone Number: 574-842-3364 x806 Views of the Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Food Service Director and/or Treasurer will utilize the procurement policy and will ensure all vendors paid with federal dollars have not been suspended or debarred. Anticipated Completion Date: Completed as of January 2024