Corrective Action Plans

Management agrees with the finding and is implementing the accompanying corrective action plan. Views of Responsible Officials: Ryan Edward, Finance and Operations Manager Name, Title: Simone Auger, Director of Operations Contact Person: Simone Auger Director of Operations   Corrective Action Plan: Employees are required to comply with the NAIHC Financial Procedures. I. PROCUREMENT PROCEDURES 1. Determination of Needs The determination of needs for goods and services will be made by qualified individuals, and according to organizational guidelines, adequate quantities, timely receipt, proper specifications, and desired quality will be considered. Those guidelines shall include that the cost be reasonable in amount, properly documented, and within the budgetary authorization of the contract. If the transaction involves federal funds, the cost must also be allowable per the terms of Subpart E of the Uniform Grant Guidance. The guidelines must also consider and avoid the disruption of program operations because of improper purchases, as well as potential losses caused by excessive purchases. 2. Methods to Determine Needs Purchasing requirements, categorized by the type of goods or service, will be determined according to the following methods: 1. The need for services that are provided on a recurring basis by the same vendor, such as utilities and telephone, will be determined initially by the accounting staff or by the Program Manager when services are program-specific. Thereafter, these services can be provided continuously or not predetermined until the end of the contract period. See “Accounts Payable for specifications on processing these types of vendor payments. 2. Determining the need for routine goods and services (items that are commonly used in the delivery of program and administrative services) will be the responsibility of the Program Directors and Executive Director. 3. Determining the need for specialized services, such as insurance, legal, or consulting services, will be the responsibility of the Executive Director. 4. The employees will identify the need for occasional goods and services and have their direct supervisor approve it before the Executive Director approves it. 3. Preparation of Requisitions for Routine Goods and Services A. Prior approval of purchases is documented by the Purchase Requisition form. Under normal circumstances, employees are required to prepare a Purchase Requisition for approval before making a purchase commitment. Procedures for doing so are listed below. If obtaining prior approval is not possible, an employee, at his or her discretion, may make a purchase and request reimbursement. However, if the purchase is not approved by their supervisor and the Executive Director, the employee becomes responsible for returning the items purchased or paying for them. If a rejected purchase was made using an NAIHC credit card, the employee will be responsible for reimbursing NAIHC. B. Purchase Requisitions for routine goods and services will be prepared by the employee and submitted directly to the Finance and Operations Manager for review for completeness, accuracy, budgetary authorization, allowability, and reasonableness. Purchase Requisitions will contain all the following information: 1. Vendor name and address. 2. Type of Request. Specify whether the request is for goods, services, a blanket purchase order, or are amending an existing purchase order. 3. Ship-to address. If there is a legitimate reason to have the goods shipped directly to your program’s offices, specify that location here. Otherwise, leave this section blank so that the shipment will be delivered to the NAIHC office. Note that if you choose to be the receiver of the goods, you are responsible for verifying the items received and their condition and forwarding the necessary paperwork to Purchasing. 4. Will Call. Check this box to see if the purchase order is to be hand-carried to the vendor. 5. Date required and special instructions (if any). Specify the date that the requested items are needed. Always include this information—it will assist the accounting department in determining priorities. Be sure to provide as much lead time as is practical by determining needs as far in advance as possible.   6. Provide all the following information where applicable: description of items or services being requested, catalog number, quantity, units, unit cost, and total amount for each item ordered. In instances where the total cost is uncertain, use the best estimate available, preferably in the form of a “not to exceed” amount. 7. Charge-to Account. Specify the NAIHC line item(s) to be charged. 8. Signatures of the Requestor and the Supervisor. 9. Date requested. This is the date that the requisition was prepared. 1. Once the Supervisor and the Executive Director have signed the Purchase Requisition, a purchase can be made, and the office administrator will receive any corresponding invoices. 2. Approved purchases made by credit card will require the credit card holder to include corresponding invoices or receipts in the monthly credit card payment packet. 4. Initiation of Requests for Proposals for Specialized Services A. The Executive Director will initiate requests for Proposals for specialized services. B. If the goods or services are complex, highly technical, or require a formal request for proposal, an appropriate contract will be prepared. The contract will be considered executed when the NAIHC Executive Director and the contractor have provided original signatures on the contract documents. One copy of the contract with original signatures will remain with the NAIHC contract files, and one copy will be provided to the contractor. 5. Initiation of Requisitions for Plant, Property, and Equipment A. Requisitions for fixed asset additions will be initiated by programs in accordance with guidelines for Additions to Plant, Property, and Equipment in §900 of the NAIHC Financial Policies approved by the Board.   6. Placement of Orders Requisitions for purchases will be reviewed to ascertain that the requisition amount is within budgetary parameters. Purchase orders will be made on approved purchase order forms and reviewed for correctness and completeness. Approval of the Purchase Requisition and generation of a Purchase Order will occur prior to the establishment of a firm order. Copies of the Purchase Order and all supporting documentation will be filed to allow for timely follow-up on uncompleted orders. 7. Establishment of Purchasing/Procurement Guidelines Quality, integrity, broad-based competition, and increased economy and efficiency in the procurement process are essential. This policy also establishes a maximum threshold for procurement of equipment, materials, supplies, and services authorizing NAIHC's Executive Director to expend without prior approval of NAIHC Board of Directors. The procurement limit approved by the Board of Directors for Executive Director is set at $150,000. Purchases and contracts for services exceeding $150,000 will need prior approval of the Board of Directors. Purchasing and contracting shall be conducted in accordance with the following procedures: A. Non-competitive Small Procurement Orders For procurement orders under $10,000, competition is preferred, but is not required. Procurements over the small procurement limit that are not executed through a competitive process must include a written justification for why a competitive method has not been used. The justification must include a verification that the price is fair and reasonable and is from a responsible vendor, has the capability in all respects to perform fully the contract requirement, and has the integrity and reliability to assure good faith performance.   B. Competitive Procurement Orders Generally, NAIHC shall select the vendor with the most competitive bid. If NAIHC management has reason to believe that the most competitive source may fail to provide the goods or services needed due to inferior quality, untimely delivery, or a similar cause, NAIHC management is authorized to select the next most competitive source as long as it’s within 15% of the most competitive source. For orders exceeding $10,000, at least three competitive bids, proposals, or quotes shall be sought by:  Telephone inquiry or  Advertisement, or  Mailing invitations to bid suppliers known to NAIHC management, board members or TDHEs, or  a combination of the above. Adequate records shall be kept for competitive orders and may include the following:  Name of purchaser and, if applicable, direct supervisor.  Solicitation documentation, including the names of vendors, copies of any written responses received, or an explanation for a single bid response.  Copy of certification by appropriate director/administrator indicating fund availability to satisfy contractual requirements.   C. Sole Source Procurements Procurement without competition is authorized under limited conditions and subject to written justification documenting the conditions that preclude the use of a competitive process. If the appropriate Program Director/Program Manager determines that there is only one source that will satisfy the requirements and/or circumstances present, the Program Director/Program Manager may, with the approval of the Executive Director, negotiate and award a contract without competition to the sole source. Reasonable steps shall be taken to avoid using sole source procurement except in circumstances where it is both necessary and in the best interest of NAIHC. D. Emergency Procurement When an emergency condition exists (to be determined by the Executive Director) that prevents the use of formal competitive procurement methods in awarding a contract or purchasing goods deemed essential to NAIHC, emergency procurement may be negotiated on a sole source or limited competition basis as dictated by the circumstances surrounding the emergency. The emergency procurement shall be limited to the procurement of only the types of items and quantities or time periods sufficient to meet the immediate threat and shall not be used to meet long-term requirements. Exclusions:  Any Federal, State, or private grant, contract, gift, or endowment with specific terms or requirements.  Agreements creating contractual employee relationships.  Any procurement or contract to the extent of any conflict with a governing federal law, regulation, or other requirement. Anticipated Completion Date: January 1, 2024

Finding 2023-006: Significant Deficiency and Noncompliance Finding, Reporting – Special Reporting Finding: Three of the four quarterly Project and Expenditure Reports were not submitted as required, and the one that was submitted was submitted past the deadline. Corrective Action Taken or Planned: Kara Prunty, Assistant Director of Finance has taken on this responsibility. The quarterly reports for SLFRF have been submitted for 2024 quarters 2, 3, and 4.

Taylor Regional Hospital (Hospital) respectfully submits the following corrective action plan for the year ended March 31, 2023. The findings from the March 31, 2023 Schedule of Findings and Questioned Costs is discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FEDERAL AWARD PROGRAMS AUDIT FINDINGS Significant Deficiency (2023-004) Recommendation: The Hospital should immediately fund the Reserve Account to the proper funding level required by the USDA loan. Planned Corrective Action: The hospital agrees with this finding. See 2023-002.

2023-007 – Completion and Submission of the Annual Single Audit Federal Agency: U.S. Department of Labor, U.S. Department of Transportation, U.S. Department of Health and Human Services and U.S. Department of Homeland Security Federal Program Name: Various Assistance Listing Numbers: 17.258, 17.259, 17.277, 17.278, 17.283, 20.205, 21.023, 21.027, 93.558, 93.959, 93.778, 97.036 Federal Award Identification Number and Year: Various Pass-Through Agency: Various Pass-Through Number(s): Various Award Period: 1/1/2023 – 12/31/23 Type of Finding: Other Matters and Significant Deficiency in Internal Control Over Compliance Condition: The County’s single audit and reporting package was delayed for the year ended December 31, 2023, beyond the due date. Recommendation: The County should evaluate its procedures around timely submission of the single audit. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned and taken in response to finding: The reason for the recurrence of the finding is in part a result of the timing of when the finding was issued. The 2023 ACFR was issued on February 14, 2025. The Single Audit began after that in late February 2025. At that point the 2023 Single Audit was already past the submission deadline. The County prioritized completion of the 2023 Single Audit and has allocated staff time from the Controller’s department and hired outside temporary professional staffing to complete the audit. Throughout the process, the Grant Accountant and Controller staff have facilitated communication and information between grant-funded departments and CLA resulting in a quick turnaround and completion of the Single Audit. Continued use of Infor’s grant management system and Project codes are increasing efficiency in accurately completing the SEFA and providing documentation as requested for programs being audited. The County began implementing a grant accounting system as part of our implementation of Infor in mid-2021 and are continuing to work with departments to refine their use of the systems. The County is working to compile information required for the 2024 ACFR, and the 2024 SEFA preparation is underway. To expedite this process, the County has engaged additional contract professional staff and is also in the process of hiring an additional full-time employee in the Grant Accounting area. Depending on external auditor availability and other Financial Audits being conducted, the 2024 SEFA will be complete and ready for review by August 2025, with a goal of timely completion of the 2024 Single Audit by the due date of September 30, 2025. Name(s) of the contact person(s) responsible for corrective action: Thomas Landauer and Fonta Reilly Planned completion date for corrective action plan: September 2025

Finding Number: 2023-006 Finding Title: Reporting Program: 21.027 COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Name of Contact Person Responsible for Corrective Action: Charles Schrader, Auditor / Treasurer Corrective Action Planned: Faribault County will implement procedures to ensure federal program reports are completed accurately. This includes consulting reporting instructions provided by grantor agencies and seeking clarification from grantors when needed. Anticipated Completion Date: December 31, 2025

Finding No . 2023-002: Annual Audit Submission Assistance Listing Program Title and Number: All Federal Agency: All Pass-through Entity: All Description of Finding: As per the Code of Federal Regulations, Section 200.512 - Report Submission, the audit must be completed and the Data Collection Form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditors’ report, or nine months after the end of the audit period. The due date for the audit and reporting package submission was March 31, 2024. Statement of Concurrence or Nonconcurrence: The State Education Resource Center agrees with this finding. SERC experienced staffing shortages and related difficulties during the fiscal year. As such, SERC was not able to prepare timely for the audit for the Uniform Guidance, Data Collection Form, and reporting package to be filed by the due date. Corrective Action: In May of 2024, the State Education Resource Center hired a new Chief Financial Officer whose focus is to bring the organization up to date on all audits and reporting and to ensure that the Fiscal team has the proper tools and guidance to perform their tasks and to improve policy and process for the department. This will also aid in ensuring all necessary efforts will be taken to ensure timely submission of the audit, Data Collection Form, and reporting packages. Name of Contact Person: Jim Fried, Chief Financial Officer, 860-740-4263, fried@ctserc.org will be responsible for completing the corrective action plan. Projected Completion Date: The anticipated date for completing the corrective action plan is June 30, 2025. The action plan will be monitored on a bi-annual basis to ensure ongoing compliance.

Finding No . 2023-001: Financial Reporting Assistance Listing Program Title and Number: All Federal Agency: All Pass-through Entity: All Description of Finding: In fiscal year 2023, SERC’s accounting processes and internal controls over financial reporting were not functioning timely to support generating complete and accurate financial information. The books and records were not closed and finalized timely. Numerous adjustments to the trial balances were made, necessitating revisions to account reconciliations, and grant schedules. Statement of Concurrence or Nonconcurrence: The State Education Resource Center agrees with this finding. The Fiscal Department experienced staff shortages and related difficulties during the fiscal year. Because of this the books and records were not closed and completed until many months after the year end. In addition, SERC’s accounting processes and internal controls over financial reporting did not function properly. Corrective Action: In May of 2024, the State Education Resource Center hired a new Chief Financial Officer whose focus is to bring the organization up to date on all audits and reporting and to ensure that the Fiscal team has the proper tools and guidance to perform their tasks and to improve policy and process for the department. Name of Contact Person: Jim Fried, Chief Financial Officer, 860-740-4263, fried@ctserc.org will be responsible for completing the corrective action plan. Projected Completion Date: The anticipated date for completing the corrective action plan is June 30, 2025. The action plan will be monitored on a bi-annual basis to ensure ongoing compliance.

2023-005 - Reporting Corrective Action Plan: Management agrees with the finding and has committed the resources giving rise to the finding. Person(s) Responsible: M. Michael Garza Timing for Implementation: June 30, 2025.

Finding Number: 2023-006 Finding Title: Reporting – DHS Social Service Fund (DHS-2556) Program: 93.658 Foster Care – Title IV-E Name of Contact Person Responsible for Corrective Action: Janelle White – Controller for Ramsey County’s Health & Wellness Service Team Enrique Rivera – Fiscal Services Manager for Ramsey County’s Health & Wellness Service Team Corrective Action Planned: Starting in the third quarter of 2024, Ramsey County instituted an additional verification step in the review process to support the determination of accurate cost pool categorization of reimbursable costs for the Random Moment Time Study Reports cost reports. The additional step will be to confirm that on the Summary Tab of the Quarterly Payroll file, the cost codes lines are in sequential order and that the corresponding expense totals match the cost code. The Senior Accountant will do the first review of this step, and the Fiscal Manager will complete the second review. The error on the 2nd quarter 2023 report was remedied and resubmitted in the 2nd quarter of 2024. Anticipated Completion Date: July of 2024 when the 2nd quarter DHS-2556 and DHS 2550 are due to be complete and finalized.

Finding Number: 2023-005 Finding Title: Reporting – PR29 – CDBG Cash on Hand Quarterly and Federal Funding and Accountability and Transparency Act Program: 14.218 Community Development Block Grants/Entitlement Grants 14.218 COVID-19 – Community Development Block Grants/Entitlement Grants Name of Contact Person Responsible for Corrective Action: Max Holdhusen, Deputy Director of Community and Economic Development Corrective Action Planned: 1) Ramsey County will implement internal procedures to complete PR29 quarterly reports as required by HUD and ensure the correct accounting basis and accounts are being utilized. 2) Ramsey County will implement procedures to complete reports on FSRS required by FFATA. 3) Ramsey County will develop/update our agency’s written grants administration policies and procedures to align with current practices and applicable rules. 4) Ramsey County will conduct regular trainings of policies and procedures for staff involved with CDBG grants administration. Anticipated Completion Date: July 15, 2025

Finding 2023-001 Late Reporting and Noncompliance with Reporting Requirements Name of Contact: Eli Wassillie, Tribal Administrator Corrective Action Plan: Management will engage a CPA firm with enough advanced timing to ensure that the single audit is completed and submitted with in the 9-month time period. Proposed Completion Date: December 31, 2024

Finding no.: 2023-001 Contact person(s) responsible: Kymberly Horner, Executive Director Corrective action planned: The late filing was due to significant turnover in the Fiscal Department beginning in 2021. Work was delayed as new staff required training on processes in conjunction with working through a large backlog of work in the Department that was necessary to complete in order to prepare the Financial Statements for audit. In addition to adapting its processes in the Fiscal Department to ensure the continuance of proper separation of duties and adherence to policies and procedures during staff transitions, Management is developing procedures to hire, train, and retain Fiscal Staff to help stabilize the department to ensure the work can continue in the event of unexpected staff turnover. Management is aware of the deadline related to the submission of the data collection form and anticipates that these measures will have a positive impact on the timeliness of future submissions. Anticipated completion date: October 2023

View of Responsible Official and Corrective Action Plan Heading Home management is in agreement with this finding. Management has reviewed the existing policies and procedures found in Section II Policy #201 of Heading Homes fiscal policies and procedures with appropriate staff and will enforce the policies and procedures to ensure all invoices and funds requests are properly reviewed and approved prior to processing. All invoices and requests for funds for fiscal year 2024 will be reviewed to ensure the payment request is reasonable and necessary. The invoice or funds request will be signed and dated by the preparer, as well as by the reviewer as evidence of approval for processing the payment. All invoices and funds requests will be maintained in the cloud server in a manner that allows them to be easily retrieved when needed. The disbursements in question were reviewed and found to be to vendors regularly used by Heading Home and Heading Home firmly believes that documentation of approval existed at one point in time. However, with the complete turnover in executive personnel during 2023, and the fact that the prior administration utilized an online system for document storage that the current administration has very little access to, we were unable to locate the approvals for these payments. Management anticipates the above corrective action plan to be fully implemented by June 30, 2024. Personnel responsible for ensuring implementation include Connie Chavez, Chief Executive Officer, Debbie Brickman, Chief Financial Officer, and Armando Sanchez, contract accountants team lead.

U.S. Department of Housing and Urban Development Significant Deficiency in Internal Control over Compliance Community Development Block Grant – Assistance Listing No. 14.218 Condition: The Organization was unable to locate documentation related to performance and financial reporting. Recommendation: The Organization should review its internal controls and procedures to ensure all relevant documentation is reviewed and retained for all federal funds awarded. Implementing a standardized process for document retention and training staff on proper record-keeping practices can help mitigate this issue in the future. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: The organization has developed a more robust contract compliance process which includes document retention and training. The organization recently reviewed and updated the document retention policy and trained staff responsible for record-keeping. The organization also began conducting internal audits to ensure documentation is reviewed and retained properly. Name(s) of the contact person(s) responsible for corrective action: Dawn Godshall, Executive Director Planned completion date for corrective action plan: Planned completion date is December 31, 2024.

U.S. Department of Housing and Urban Development Significant Deficiency in Internal Control over Compliance Community Development Block Grant – Assistance Listing No. 14.218 Condition: The Organization was unable to locate contract and/or contract extensions for federal funding awarded expended during the period. Recommendation: The Organization should review its internal controls and procedures to ensure all relevant documentation, such as contracts or agreements, is reviewed and retained for all federal funds awarded. Implementing a standardized process for document retention and training staff on proper record-keeping practices can help mitigate this issue in the future. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: The organization has developed a contract database and review process for all new and existing contracts. This process includes appropriate naming conventions across all platforms to ensure accuracy in records. Name(s) of the contact person(s) responsible for corrective action: Dawn Godshall, Executive Director Planned completion date for corrective action plan: Planned completion date is June 30, 2024.

U.S. Department of Agriculture Significant Deficiency in Internal Control over Compliance The Emergency Food Assistance Program (Administrative); Commodity Supplemental Food Program (Administrative)– Assistance Listing No. 10.569 and 10.565 Condition: CACLV does not have formal procedures in place to determine the Second Harvest Food Bank expenses incurred during the fiscal year that should be allocated to the TEFAP/CSFP administrative revenue received. CACLV has historically recognized revenue based on when cash is received which is not appropriate. Recommendation: We recommend the allocation of allowable costs and activities be completed at a minimum on a quarterly basis. Also, any direct expenses related to program activities should be recorded to the respective identifying program fund number within the accounting software. The amount of revenue recognized for the programs should be reflected of the expenses incurred up to the administrative funds received from the respective funders. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: The organization will implement a standard allocation to be completed on a quarterly basis at the minimum. This process will be reviewed by management to ensure implementation. Name(s) of the contact person(s) responsible for corrective action: Dawn Godshall, Executive Director Planned completion date for corrective action plan: Planned completion date is June 2025.

Finding 2023-005 – Significant Deficiency in Internal Control over Compliance, Other Matters Description of Finding For one of two reports tested related to fiscal year 2023, the report was not submitted within 30 days of the end of the quarter. Statement of Concurrence or Nonconcurrence Management concurs with the finding. Corrective Action This late submission was the result of significant turnover in the Town’s Finance Department. All subsequent reports have been filed and will continue to be filed in a timely manner. Name of Contact Person Robert J. Civetti, CPA, Finance Director Projected Completion Date Completed and all reports timely filed since June 30, 2023

Finding 2023-004 - Significant Deficiency in Internal Control over Compliance, Other Matters Description of Finding The Town of Coventry and Coventry Public School Department do not have policies and procedures in place to ensure that they do not contract with or make subawards to parties that are suspended or debarred. Statement of Concurrence or Nonconcurrence Management concurs with the finding. Corrective Action Management of the Town and School Department will review the district’s suspension and debarment policy and make sure that it is following the criteria as set out in the 2 CFR section 180 of the Uniform Guidance. The policy will then be updated and communicated to all personnel involved in the procurementprocess. Name of Contact Person Robert J. Civetti, CPA, Town Finance Director; Christopher Deverna, CPA, Director of Finance, Coventry Public Schools Projected Completion Date June 30, 2025

Finding 2023-004 – Education Stabilization Fund – AL No.’s 84.425D & 84.425U Department of Education Massachusetts Department of Elementary and Secondary Education Noncompliance and Significant Deficiency Related to Internal Control over Compliance of the Major Program Criteria: Where employees work solely or partially on a single Federal program or cost objective, their salaries or wages must be supported by periodic certification that the employee worked on these programs for the period covered by the programs. The certifications should be prepared at least semi-annually, and should be signed by the employee or supervisory official having first-hand knowledge of the work performed by the employee. Condition: During our test of controls over compliance with time and effort certifications the Town was not able to provide evidence that the required certifications of time and effort for employees whose time was spent either completely or partially spent on these programs was performed as required by Uniform Guidance. Questioned Costs: Unknown Context: During our test of payroll transactions of the major program (Education Stabilization Fund) it was noted that the time and effort certification for employees tested were not completed. Effect: The Town was not in compliance with the time and effort certification requirements. Cause: Time and Effort Certifications were issued semi-annually. However, in some circumstances staff had terminated employment and letters were not issued outside of the school setting. Identification as a Repeat Finding: 2022-004 Recommendation: We recommend the Town of Bellingham follow procedures to ensure that semi-annual certifications and/or monthly certifications are prepared and signed by either the employees and/or supervisory official having first-hand knowledge of the work performed by the employees in a timely manner in order to comply with the time and effort certification requirement. Responsible for Corrective Plan: Director of Finance, Schools Estimated Completion Date: December 2024 Action Taken: We have amended our process for issuing Time and Effort Certifications. We are now emailing them and if they are returned, we will re-issue to their home address with a self-addressed stamped envelope. In some circumstances such as committee work, we will have the staff sign an acknowledgement at the time of the meeting(s).

Finding 2023-001 – Education Stabilization Fund – AL No.’s 84.425D & 84.425U Department of Education Massachusetts Department of Elementary and Secondary Education Noncompliance and Significant Deficiency Related to Internal Control over Compliance of the Major Program Criteria: Grantees must provide reasonable assurance that federal awards are expended only for allowable activities and that the costs of goods and services charged to federal awards are allowable and in accordance with the applicable cost principles. Management of the Town is also responsible for establishing and maintaining effective internal control over compliance with federal requirements that have a direct and material effect on a federal program. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. Condition and Context: Control deficiencies related to disbursements were noted as a result of the testing of internal controls over payroll. Specifically, a sample of payroll disbursements charged to the major program were tested in order to determine if adequate internal controls were in place. As a result of the testing of payroll disbursements charged to the programs, the employees tested were found to not have adequately approved and or documented employee payroll rate agreements. Cause: Appointment letters for some staff tested could not be located. I believe this is due not to non-compliance but turnover within the office and not being able to locate paper files. Effect or Potential Effect: Due to the significant deficiencies and noncompliance in internal controls noted above, there is a risk of inappropriate rate of pay and/or wages being paid. Identification as a Repeat Finding: 2022-001 Questioned Costs: Questioned costs could not be determined. Recommendation: The Town of Bellingham should improve the internal controls over Activities Allowed/Allowable Costs by ensuring employee’s payroll rate agreements are approved by an appropriate level of management and in a timely manner. Responsible for Corrective Plan: Director of Finance, Schools Estimated Completion Date: December 2024 Action Taken: The Director of Finance will ensure that all employees paid have an approved and documented pay rate or salary from either an appointment letter, School Committee salary worksheet, and/or Collective Bargaining Agreement.

Recommendation: KRM should have future audits completed timely and filed timely with the Federal Audit Clearinghouse. Action Taken: KRM continues to take steps to increase the staffing to help with the increased number of refugees served as well as implementing new software changes to streamline processes for more efficient operations.

We will reconcile all of 2024 accounts to ensure accuracy. Expenditure and reimbursement of all federal funds will be recorded timely and accurately.

We will implement more internal training with the Accounts Payable department to ensure manifests are signed.

Finding 2023-002 Significant Deficiency in Internal Control over Compliance, Noncompliance - Reporting Corrective Action Plan To prevent recurrence of the late filing of financial reports, staff will work to prepare year end reconciliations for major programs, state and federal schedules of expenditures to determine single audit status, and file corresponding reports in a timely manner. Expected Completion Date June 30, 2025

Finding Number: 2023-003 Finding Title: Special Tests and Provisions – Davis‐Bacon Act Name of Contact Person Responsible for Corrective Action: Heidi E. Winter, County Auditor-Treasurer Corrective Action Planned: County staff will obtain and properly review the certified payrolls received from all contractors and subcontractors for compliance with the Davis‐Bacon Act and Title 29 U.S. Code of Federal Regulations Part 5 and ensure documentation exists to support monitoring of and compliance with this requirement. Anticipated Completion Date: December 31, 2024