Corrective Action Plans

Finding 1228735 (2023-005)

Material Weakness 2023

CO

Allowable Costs / Cost Principles Subrecipient Monitoring § 200.308

Action Taken in Response to Finding: Budget-to-actual comparisons began in 2024 and were subsequently standardized and incorporated into Financial Policies and Procedures. As of 2026, budget-to-actual comparisons are performed on a monthly basis as part of the month-end (EOM) close, prior to the pre...

Action Taken in Response to Finding: Budget-to-actual comparisons began in 2024 and were subsequently standardized and incorporated into Financial Policies and Procedures. As of 2026, budget-to-actual comparisons are performed on a monthly basis as part of the month-end (EOM) close, prior to the preparation and submission of Federal reimbursement requests. This ensures that: • Expenditures are reviewed against approved grant budgets prior to reimbursement • Variances are identified and evaluated • Costs charged to Federal awards align with approved budgets and allowable use requirements Additionally, Budget and Program Revisions and Allowable Use of Funds policies were incorporated into the Financial Policies and Procedures to formalize requirements for budget compliance and modification. Control Enhancement: A standardized budget-to-actual review has been implemented across all applicable Federal awards. This process: • Compares actual expenditures to approved grant budgets on a monthly basis • Identifies variances requiring review or correction • Ensures expenditures are aligned with budget categories and allowable cost requirements • Requires budget review prior to submission of reimbursement requests Monitoring & Review: • Budget-to-actual comparisons are performed monthly as part of EOM close • Initial review is completed by Finance • Secondary review is performed by the Director of Finance & Operations • Program staff are engaged as needed to validate alignment with program activities • Any required budget modifications are identified and addressed prior to reimbursement Testing & Validation: • Beginning in June 2026, quarterly internal reviews will be conducted to validate that budget monitoring controls are operating effectively • Testing will confirm that: o Budget-to-actual reviews are completed consistently o Variances are appropriately identified and addressed o Reimbursements align with approved budgets Documentation & Evidence: • Budget-to-actual reports maintained in Teams / Sharepoint • Supporting documentation for budget revisions retained • Approval and review evidenced via email/workflow/sign-off Control Owner(s): • Director of Finance & Operations • Finance Team Responsible Party: Director of Finance & Operations, with executive oversight by the Chief Executive Officer Anticipated Completion Date: All corrective actions will be implemented by June 30, 2026. Ongoing monthly monitoring and quarterly validation will continue. Status: • Budget-to-actual comparisons (limited): Implemented 2024 • Standardized monthly workflow (EOM close): Implemented April 2026 • Policy integration into Financial Policies and Procedures: Completed May 2026 • Quarterly internal reviews will be conducted to validate that budget monitoring controls are operating effectively: June 2026

View Audit 410398

Finding 1228734 (2023-004)

Material Weakness 2023

Activate Work Inc.

CO

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303 § 200.307 § 200.403

Action Taken in Response to Finding: Financial practices addressing program income were in place; however, processes were formalized to ensure full compliance with 2 CFR §200.307. ActivateWork developed and implemented a Program Income Policy as part of its Financial Policies and Procedures, adopted...

Action Taken in Response to Finding: Financial practices addressing program income were in place; however, processes were formalized to ensure full compliance with 2 CFR §200.307. ActivateWork developed and implemented a Program Income Policy as part of its Financial Policies and Procedures, adopted May 2026. As of March 2026, a standardized program income tracking and reconciliation is performed monthly as part of the month-end (EOM) close. This process includes: • Identification and tracking of program income by funding source • Application of program income to actual allowable expenses • Mapping of Federal reimbursement requests to underlying expenses to ensure program income is applied prior to reimbursement • Validation that no duplication of funding occurs between program income and Federal reimbursements These enhancements establish a structured and auditable framework for program income tracking, application, and compliance. Control Enhancement: Program income is tracked and recorded within a standardized Excel-based tool (Program Income vs. Unreimbursed Cost Analysis) and applied in accordance with federal requirements. A standardized program income tracker: • Applies program income to actual expenses • Links expenses to reimbursement requests • Ensures program income is fully utilized prior to requesting Federal reimbursement, unless otherwise specified by award terms • Prevents duplication of income and reimbursement Monitoring & Review: • Program income tracking is reviewed monthly as part of the EOM close process • Review is performed by the Senior Accountant • A secondary review is performed by the Director of Finance & Operations to validate completeness and compliance • Any discrepancies are identified and resolved prior to reimbursement submission Testing & Validation: • Beginning in June 2026, quarterly internal reviews will be conducted to validate program income tracking and application • Testing will confirm that: o Program income is accurately recorded o Program income is applied prior to reimbursement o No duplication of funding exists • Results will be documented and tracked for remediation Documentation & Evidence: • Program income tracker maintained in Teams / SharePoint • Supporting documentation tied to underlying expenses Control Owner(s): • Director of Finance & Operations • Finance Team Responsible Party: Helen Young Hayes, Founder / Chief Executive Officer, in coordination with the Director of Finance & Operations and Finance Staff Anticipated Completion Date: All corrective actions will be implemented by June 30, 2026. Ongoing monthly monitoring, reconciliation, and quarterly validation will continue. Status: • Program Income Policy: Implemented May 2026 • Program income tracking process: Implemented April 2026 • Monthly reconciliation and application (EOM Close): Implemented May 2026 • Quarterly internal reviews will be conducted to validate program income tracking and application: June 2026.

View Audit 410398

Finding 1228733 (2023-003)

Material Weakness 2023

Activate Work Inc.

CO

Subrecipient Monitoring Procurement, Suspension & Debarment Reporting § 200.214 § 200.332

Action Taken in Response to Finding: A Subrecipient Monitoring Policy was implemented in May 2023 to establish processes for subrecipient identification, agreement requirements, invoice review, and ongoing monitoring. The policy was developed in alignment with guidance provided by the CDLE monitorin...

Action Taken in Response to Finding: A Subrecipient Monitoring Policy was implemented in May 2023 to establish processes for subrecipient identification, agreement requirements, invoice review, and ongoing monitoring. The policy was developed in alignment with guidance provided by the CDLE monitoring team. In subsequent years, the subrecipient monitoring framework was strengthened. As of February 2026, CLA’s grant management team has been engaged to further enhance subrecipient monitoring processes. Enhancements include: • Formalization and expansion of the Subrecipient Monitoring Policy, incorporated into the Financial Policies and Procedures, adopted May 2026 • Implementation of a standardized risk assessment process to evaluate subrecipient risk prior to award issuance • Implementation of a formal Subrecipient Monitoring Memorandum process to document monitoring activities • Implementation of a standardized monthly monitoring checklist to ensure consistent financial and compliance review (effective October 2025) • Establishment of a secondary review control requiring validation by the Chief Operating Officer or Chief Executive Officer in addition to the initial review by the Director of Finance & Operations (effective June 2026) These enhancements strengthened documentation, consistency, and oversight, and established a structured and audit-ready subrecipient monitoring framework. Control Enhancement: ActivateWork has strengthened its subrecipient monitoring practices through the implementation of a structured and documented framework that includes: A segregation of duties has been implemented within the monitoring framework, requiring preparer-level review by the Director of Finance & Operations and secondary review by executive leadership (Chief Operating Officer or Chief Executive Officer). These controls are integrated into ongoing financial operations to ensure subrecipient monitoring is consistently applied, documented, and reviewed. 1. Subaward Identification & FSRS Reporting Subawards are identified and tracked within the Subrecipient Determination Checklist. First-tier subaward reporting is completed in accordance with federal requirements. The Director of Finance & Operations is responsible for ensuring FSRS reporting is completed timely and accurately in accordance with federal deadlines, and documentation of submission is retained within the subrecipient file. 2. Suspension and Debarment (SAM.gov) Subrecipients are verified against SAM.gov prior to contract execution. Documentation of verification is retained in subrecipient files and is included as part of the Subrecipient Determination Checklist. 3. Risk Assessment (Pre-Award) A formal risk assessment is conducted prior to issuing subawards using a standardized scoring methodology that evaluates: • Experience with grants • Program complexity • Funding size • Documentation quality • Prior monitoring issues This assessment is documented within the Subrecipient Determination Checklist. 4. Ongoing Financial Monitoring Monthly invoice reviews are conducted, including: • Mathematical accuracy • Alignment with contract terms • Allowability, allocability, and reasonableness under 2 CFR Part 200 • Reconciliation to supporting documentation This is documented and maintained in the Subrecipient Monthly Monitoring Checklist. 5. Programmatic Monitoring Ongoing coordination is conducted between ActivateWork and subrecipient program staff to monitor: • Program delivery • Participant outcomes • Alignment with grant deliverables 6. Subrecipient Audit Review Subrecipient audit information is obtained and reviewed when applicable. The Director of Finance & Operations is responsible for review, and documentation is maintained within the Subrecipient Monthly Monitoring Checklist. 7. Subaward Agreement Requirements Subaward agreements include required federal award information, compliance expectations, and reporting requirements. The Director of Finance & Operations utilizes a subrecipient agreement template provided by the CDLE monitoring office and ensures all federal award information is complete. 8. Personnel Cost Monitoring (Payroll / Fringe) Personnel costs are reviewed based on documentation provided and evaluated for: • Alignment with program delivery • Reasonableness of allocations • Consistency with invoice detail Review is performed by the Director of Finance & Operations, with documentation maintained within the Subrecipient Monthly Monitoring Checklist. Monitoring & Review: • Monthly monitoring is conducted using a standardized checklist • All invoices are reviewed prior to approval and payment • Issues are documented and tracked through resolution Testing & Validation: • Beginning in June 2026, quarterly internal reviews will be conducted to validate that subrecipient monitoring controls are operating effectively • Monitoring documentation will be reviewed for completeness and compliance Documentation & Evidence: • Monitoring memorandums maintained for each subrecipient • Monthly monitoring checklists retained • Supporting documentation maintained in Teams / SharePoint Control Owner(s): • Director of Finance & Operations • Finance Team • Program Leadership Responsible Party: Director of Finance & Operations, with executive oversight by the Chief Executive Officer Anticipated Completion Date: All corrective actions will be implemented as of June 30, 2026. Ongoing monitoring, documentation, and quarterly validation will continue as part of standard operations. Status: • Subrecipient monitoring policy: Adopted May 2023 and updated annually • Monitoring documentation (memorandum and checklist): Implemented in 2024 and enhanced in Oct 2025 • Policy strengthened: May 2026 to incorporate enhanced documentation, standardized procedures, and secondary review controls • Quarterly internal reviews will be conducted to validate the subrecipient monitoring controls are operating effectively: Jun 2026

View Audit 410398

Finding 1228548 (2023-006)

Material Weakness 2023

Mental Health Kokua

HI

Cash Management Subrecipient Monitoring Period of Performance § 200.303 § 200.334

Management agrees with the finding and will implement procedures to ensure reimbursement request documentation and supporting schedules are retained in a centralized location and readily accessible for future monitoring and audit purposes. Anticipated Completion Date: September 30, 2026.

View Audit 410168

Finding 1228512 (2023-005)

Material Weakness 2023

Developmental Opportunities INC Dba Starpoint

CO

Equipment & Real Property Management Subrecipient Monitoring § 200.313

Finding 2023-005 Head Start Equipment Management Contact person responsible for corrective action: Bryana Marsicano, Chief Executive Officer Anticipated completion date: December 31, 2026 Corrective Action: Management agrees with the finding and will implement the following procedures for equipment ...

Finding 2023-005 Head Start Equipment Management Contact person responsible for corrective action: Bryana Marsicano, Chief Executive Officer Anticipated completion date: December 31, 2026 Corrective Action: Management agrees with the finding and will implement the following procedures for equipment acquired with federal funds: • Maintain a property record for each item of federally funded equipment containing every element required by 2 CFR 200.313(d)(1), including a description of the property, the serial number or other identification number, the source of funding and the Assistance Listing number, who holds title, the acquisition date and cost, the percentage of federal participation in the project cost, the location, the use and condition of the property, and any ultimate disposition data. • Perform and document a physical inventory of federally funded equipment and reconcile the results to the property records at least once every two years. • Document any discrepancy identified between the physical inventory and the property records, investigate the cause, and record the resolution. • Adopt a written equipment management policy that assigns responsibility for maintaining property records, conducting periodic physical inventories, and approving dispositions, and that establishes control procedures adequate to safeguard equipment against loss, damage, or theft in accordance with 2 CFR 200.313(d)(3). • Obtain written approval from the awarding agency before disposing of federally funded equipment where such approval is required. • Perform supervisory review of the equipment records at each fiscal year end to confirm completeness and agreement with the general ledger. Corrective action already taken: A physical review of equipment has been completed, asset retirements have been confirmed, and the fixed asset records have been rebuilt and reconciled to the general ledger. Equipment acquired with Head Start funds is being separately identified within those records so that the percentage of federal participation can be documented for each item.

View Audit 410150

Finding 1228434 (2023-008)

Material Weakness 2023

Sayre Health Center

PA

Subrecipient Monitoring Allowable Costs / Cost Principles Eligibility

Finding No. 2023-008: Inadequate Documentation and Records for Application of Sliding Fee Discounts We have incorporated a policy that establishes the basis for the sliding fee policy to assure affordable access to care for uninsured and underinsured patients of the organization. The policy will rec...

Finding No. 2023-008: Inadequate Documentation and Records for Application of Sliding Fee Discounts We have incorporated a policy that establishes the basis for the sliding fee policy to assure affordable access to care for uninsured and underinsured patients of the organization. The policy will recognize a “full discount” for individuals and families with annual incomes at or below 100% FPL with only nominal fees charged, three levels of discount between 100% and 200%, and no discounts for copays for individuals and families earning over 200% FPL. This policy will be in accordance with Section 330(k)(3)(G) of the PHS Act and 42 CFR Part 51c.303(f) and 42 CFR Part 51c.303(u) which are incorporated herewith. We will charge a nominal fee to individuals and families with annual incomes at or below 100% of the Federal poverty level (FPL). Patients whose incomes are above 100% and at or below 200% of the FPL will be charged according to our sliding fee scale based on income and family size. Discounts will be provided to patients with incomes up to 200% of the FPL for medical visits. Discounts will be provided to patients with incomes up to 250% of the FPL for family planning visits. Staff will assess patients’ incomes based upon a sliding fee scale and no patient will be denied care based upon their inability to pay. The organization also has a policy of non-discrimination in the delivery of health care as stated in its Patient Bill of Rights. Also, the Board of Directors define the income and family size, and has defined the family size to be all parents, minors or guardians that are financially responsible for the household. The tracking and documentation of sliding fees is now maintained with the deposit record of each fee received in the shared file for immediate availability and reference.

View Audit 410104

Finding 1228270 (2023-008)

Material Weakness 2023

Puerto Rico Public Private Partnerships Authority

PR

Subrecipient Monitoring Cash Management

Management Response: COR3 has already undertaken proactive measures to strengthen oversight, streamline procedures, and provide tailored guidance to support Subrecipients effectively. Efforts to Promote Compliance and Support Subrecipients. During the past years, COR3 has undertaken significant effo...

Management Response: COR3 has already undertaken proactive measures to strengthen oversight, streamline procedures, and provide tailored guidance to support Subrecipients effectively. Efforts to Promote Compliance and Support Subrecipients. During the past years, COR3 has undertaken significant efforts to assist Subrecipients in meeting regulatory requirements and adhering to COR3 policies and procedures. This has been achieved through tailored guidance provided via individual phone calls and meetings, ensuring that Subrecipients receive direct and actionable support to navigate compliance challenges effectively.Amendments to Chapter 7 (Payments & Cash Management) and SOPs. Recognizing the unique circumstances in Puerto Rico, including challenges related to construction permits and the shortage of construction services, COR3 has proactively amended Chapter 7 (Payments & Cash Management) of its policies and procedures, along with the corresponding Standard Operating Procedures (SOPs). These updates have been thoughtfully designed within COR3’s regulatory authority to account for the realities faced by Subrecipients, addressing delays in project completion and documentation submission. The changes to Chapter 7 include the following enhancements:  Added requirement of the submittal of a 90-day spend plan through the Disaster Recovery System (DRS) to the Request for Capital Advance (RFCA) Pilot Program, notating what the advanced funds will be used for  Eliminated proration selection from the RFCA reconciliation process – Subrecipients will no longer be able to defer the reconciliation of the RFCA.  Revised the term to reconcile the RFCA on or before 180 days from disbursement (RFCA Initial Term), up to a maximum of 12 months from disbursement.  Added requirement to submit monthly RFCA reconciliation RFRs if total reconciliation is not completed within RFCA Initial Term.  Removed requirement to submit a status report within 90 days of RFCA disbursement.  Added Project/RFCA status report requirement within 180 days of RFCA disbursement if total reconciliation is not completed within RFCA Initial Term.  Added percentage range to RFCA Requests in 5% increments up to a maximum of 25%, thereby ensuring that funds being advanced are tailored to the subrecipients’ needs.  Introduced a 25% minimum amount for reconciliation of RFRs to ensure that the advance is reconciled in a consistent manner; certain exceptions apply.  Modified RFR Threshold amounts as recommended but not required.  Implemented yearly notification requirements for interest earned on advances. Additionally, COR3 is amending the Advance Requirement Compliance Protocol (SOP No. 022) to address the non-compliant Subrecipients (1) with a backlog of RFR’s reconciliations, among other related matters. The primary objective of the procedure is to establish clear communication channels and procedures between COR3 and Subrecipients who are not adhering to required policies and procedures. For example, for Subrecipients with RFCAs disbursed 12 months or more which have yet to be reconciled, COR3’s Finance Division will take a series of actions to address noncompliance, starting with a request for documentation such as bank certifications or account statements. Subrecipients will have an additional 30 days to reconcile the RFCA. Failure to do so will result in a recoupment letter demanding the return of unreconciled funds or suspension of disbursements. If noncompliance persists, the Finance Division will issue a final warning letter, detailing the outstanding RFCAs and implementing the suspension of disbursements until the issue is resolved. These comprehensive amendments reflect COR3's commitment to promoting clarity, accountability, and efficiency while supporting Subrecipients in achieving their project goals within the established regulatory framework. Impact of These Efforts COR3’s initiatives have resulted in Subrecipients being better informed about their obligations in managing federal funds, as a result several Subrecipients have voluntarily returned advance payments that were not utilized or reconciled within the required timeframe. These actions illustrate COR3’s strategies in promoting accountability and compliance among Subrecipients and fostering a cooperative environment for financial and operational transparency. This reflects COR3’s ongoing efforts to support Subrecipients in achieving their project goals within the regulatory framework. Corrective Action Plan: Implement and monitor the updates made to Chapter 7 and approve the amendments and implement the new SOP (Advance Requirement Compliance Protocol (SOP No. 022)), to achieve a cooperative environment with our subrecipients for financial and operational transparency. Contact Person: María Cardec, Grants Director Anticipated Completion Date: Completed as of February 28, 2026

View Audit 410006

Finding 1228264 (2023-003)

Material Weakness 2023

Puerto Rico Public Private Partnerships Authority

PR

Subrecipient Monitoring

Management Response: COR3 clarifies that during the audited fiscal year, COR3 set up a team specifically aimed at working on centralizing the Subaward Agreements and the creation of an automated procedure for the Subaward process. The Team addressed historical challenges faced by COR3 since April of...

Management Response: COR3 clarifies that during the audited fiscal year, COR3 set up a team specifically aimed at working on centralizing the Subaward Agreements and the creation of an automated procedure for the Subaward process. The Team addressed historical challenges faced by COR3 since April of 2019, when the responsibility to subscribe Subaward Agreements was transferred from FEMA. Among the challenges were: the legacy of over 500 Subrecipients with obligated funds with a manual reimbursement methodology used by FEMA for federal grants in Puerto Rico known as the “270 Process”; continues changes by FEMA in the disbursement process and mandatory clauses to be inserted in subawards; automatic extension to the period of Performance granted by FEMA which generated modified Subawards, and nonresponsive subrecipients. COR3 has continued to prioritize addressing this finding. On August 30, 2023, the Subaward Agreement Automation Project came into effect, and all Subaward Agreement, Amended Subaward Agreements and Modification are submitted and processed through the PR DRS. Prior to generating a Subaward or Modification Agreement, the Grants Portal is reviewed daily to identify new obligated projects in each of the disasters. As part of the process and to ensure that subrecipients are aware of the availability of the Subaward in DRS, we send an email notification which contains all the details regarding Subaward Agreement signature process. As an additional measure, a master tracker has been created, which reflects the status of all signed Subaward Agreements. Corrective Action Plan: All requests for reimbursement (RFR) and requests for advance (RFA) are validated by the Grants Department against the Collaboration Portal Subaward Agreement document library. Such validation must include the verification of a signed subaward agreement for payment to be made. This guarantees that all payments made include Subrecipients that have signed a subaward agreement. Contact Persons: María Cardec, Grants Director, and Tatiana Lorenzo Compliance Director Anticipated Completion Date: Completed as of June 30, 2024.

View Audit 410006

Finding 1227860 (2023-007)

Material Weakness 2023

Island Health, Inc.

MA

Procurement, Suspension & Debarment Subrecipient Monitoring Allowable Costs / Cost Principles § 200.308 § 200.309 § 200.403

Item 2023.007 – Period of Performance Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this rec...

Item 2023.007 – Period of Performance Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and falls within the period of performance • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures that it is within the grant period. • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant's period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system. • Conduct regular reviews of expenditures to ensure compliance with the grant period and maintain audit trail • Review these procedures annually to ensure they ongoing compliance with the grant's period of performance

View Audit 409789

Finding 1227840 (2023-020)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Special Tests & Provisions Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303

Finding No.: 2023-020 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Special Tests and Provisions - Key Level Management Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Manage...

Finding No.: 2023-020 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Special Tests and Provisions - Key Level Management Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management processes were promulgated in a SOP on September 18, 2024. The SOPs are under review by an external consultant and recommendations made to improve documentation of time and effort allocable under federal awards. (See also 2023-004, 2023-0009) Corrective Action Plan: I. Establishment of Time and Effort SOPs: PSS will finalize and implement a dedicated Time and Effort Reporting SOP. This policy will explicitly define the key management Level of Effort (LOE) requirements by position and mandate the collection of specific supporting records, including Notice of Personnel Action (NOPA) forms, payroll registers, and certified timesheets. The SOP will feature robust internal controls and supervisory review procedures designed to prevent improper payments and ensure accurate labor distribution. II. Standardization of Key Management Records: PSS will obtain and systematically retain NOPA forms or equivalent documentation for all six positions identified in the grant agreement. This documentation will serve as the primary evidence to demonstrate compliance. III. Labor Distribution Monitoring Controls: PSS is implementing ongoing monitoring controls to ensure continued compliance. This includes a periodic internal review of payroll registers against the original grant agreements to verify that the labor costs charged to the award remain consistent with the approved personnel budget and documented effort. Proposed Completion Date: August 2026 Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org

View Audit 409786

Finding 1227838 (2023-018)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303

Finding No.: 2023-018 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the finding....

Finding No.: 2023-018 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the finding. While internal verification of disbursements is a standard part of our fiscal workflow, we recognize that our current process has the space to improve. Corrective Action Plan: To ensure that all disbursements are verified and documented prior to payment, PSS will implement the following: I. High Level Review and Approval: Implementation of Comptroller/ Director of Finance review on the Batch Invoice Summary signifying invoice entries on the said batch are verified and correct. After the review, the Comptroller will sign. II. Updated Payment Verification Process: Payments via check or ACH are reviewed by the Comptroller/ Director of Finance through Payment Manager and marking the Batch Invoice Summary that payments matched the invoice. Proposed Completion Date: December 2025 Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org

View Audit 409786

Finding 1227837 (2023-017)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Special Tests & Provisions Subrecipient Monitoring Allowable Costs / Cost Principles § 200.303

Finding No.: 2023-017 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Private School Participation Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management disagrees with the finding. PS...

Finding No.: 2023-017 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Private School Participation Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management disagrees with the finding. PSS asserts that timely and meaningful consultations were conducted with private school officials prior to making decisions regarding the size, scope, and funding of equitable services for FY2023. Calculations for the equitable share under the Education Stabilization Funds were performed in accordance with federal regulations, ensuring that per-pupil allocations for eligible private school students and teachers were equitable relative to public school expenditures. PSS maintains that consultation timelines, meeting records, and allocation formulas were maintained. While PSS is continuously refining its administrative workflows, the existing documentation and controls were sufficient to satisfy the requirements of 34 CFR § 299.7. Proposed Completion Date: Resolution in progress and on track for completion by August 2026. Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org

View Audit 409786

Finding 1227829 (2023-013)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303

Finding No.: 2023-013 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Activities Allowed/Unallowed, Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial a...

Finding No.: 2023-013 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Activities Allowed/Unallowed, Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies procedures were promulgated in SOPs on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve documentation of cost allowability have been received. Corrective Action Plan: I. Finalization of Allowability and Disbursement SOPs: PSS will finalize comprehensive Standard Operating Procedures (SOPs) and policies specifically governing allowability determinations and vendor payments. II. Enhanced Disbursement Controls: PSS is implementing a documented review and approval controls over the payment process. Before any check or ACH disbursement is finalized, a reviewer must verify that the payment amount agrees exactly with the approved invoice. This verification will be physically or digitally documented on the payment voucher to provide a clear audit trail of the pre-payment review. Proposed Completion Date: In progress for FY 2024 with full implementation and documentation processes expected to be completed in 2026. As part of this improvement, we are designing a standardized, documented review process to ensure all disbursements are verified against approved invoices prior to payment. Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org

View Audit 409786

Finding 1227825 (2023-010)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303

Finding No.: 2023-010 AL Program: 84.403 Consolidated Grants to the Outlying Areas Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies proce...

Finding No.: 2023-010 AL Program: 84.403 Consolidated Grants to the Outlying Areas Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies procedures were promulgated in SOPs on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve documentation of cost allowability have been received. Corrective Action Plan: I. Finalization of Allowability and Disbursement SOPs: PSS will finalize comprehensive Standard Operating Procedures (SOPs) and policies specifically governing allowability determinations and vendor payments. II. Enhanced Disbursement Controls: PSS is implementing a documented review and approval controls over the payment process. Before any check or ACH disbursement is finalized, a reviewer must verify that the payment amount agrees exactly with the approved invoice. This verification will be physically or digitally documented on the payment voucher to provide a clear audit trail of the pre-payment review. Proposed Completion Date: In progress for FY 2024 with full implementation and documentation processes expected to be completed in 2026. As part of this improvement, we are designing a standardized, documented review process to ensure all disbursements are verified against approved invoices prior to payment. Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org

View Audit 409786

Finding 1227816 (2023-005)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Reporting Subrecipient Monitoring Allowable Costs / Cost Principles

Finding No.: 2023-005 AL Program: 10.555 National School Lunch Program (NSLP) Area: Reporting Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management procedures were promulgated in a SOP on S...

Finding No.: 2023-005 AL Program: 10.555 National School Lunch Program (NSLP) Area: Reporting Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management procedures were promulgated in a SOP on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve coding of grant details and expenditures, increased frequency of reconciliations, and a specific SOP for report preparation. Corrective Action Plan: I. Implementation of a Comprehensive Grant Tracker: PSS will develop and implement a centralized Grant Lifecycle Tracker for all active federal awards. This tool will serve as the primary monitoring mechanism for compliance by recording all financial and programmatic reporting due dates, assigning specific preparers for each report, and establishing automated milestones to ensure sufficient lead time for both the preparation phase and the subsequent supervisory review. II. Deployment of Enhanced Data Analysis Tools: To ensure that quarterly program reporting is both consistent and timely, PSS will develop and implement specialized data analysis tools. these tools will streamline the aggregation of program data, reducing manual entry errors and allowing for more efficient evaluation of program performance against federal benchmarks. Proposed Completion Date: In progress for FY 2024 with completion by August 2026. Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org

View Audit 409786

Finding 1227814 (2023-003)

Material Weakness 2023

Commonwealth of the Northern Mariana Islands Public School System

MP

Allowable Costs / Cost Principles Subrecipient Monitoring School Nutrition Programs § 200.303

Finding No.: 2023-003 AL Program: 10.555 National School Lunch Program (NSLP) Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies procedures...

Finding No.: 2023-003 AL Program: 10.555 National School Lunch Program (NSLP) Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies procedures were promulgated in SOPs on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve documentation of cost allowability have been received. Corrective Action Plan: I. Finalization of Allowability and Disbursement SOPs: PSS will finalize comprehensive Standard Operating Procedures (SOPs) and policies specifically governing allowability determinations and vendor payments. II. Enhanced Disbursement Controls: PSS is implementing a documented review and approval controls over the payment process. Before any check or ACH disbursement is finalized, a reviewer must verify that the payment amount agrees exactly with the approved invoice. This verification will be physically or digitally documented on the payment voucher to provide a clear audit trail of the pre-payment review. Proposed Completion Date: In progress for FY 2024 with full implementation and documentation processes expected to be completed in 2026. As part of this improvement, we are designing a standardized, documented review process to ensure all disbursements are verified against approved invoices prior to payment. Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org

View Audit 409786

Finding 1227717 (2023-003)

Material Weakness 2023

SOUTHWEST INDIGENOUS WOMENS COALITION

AZ

Procurement, Suspension & Debarment Subrecipient Monitoring § 200.214 § 200.318

Management Response: Management concurs with the finding. During the audit period, procurement documentation was not consistently maintained in a centralized manner sufficient to demonstrate full compliance with Uniform Guidance procurement requirements, although management believes procurement deci...

Management Response: Management concurs with the finding. During the audit period, procurement documentation was not consistently maintained in a centralized manner sufficient to demonstrate full compliance with Uniform Guidance procurement requirements, although management believes procurement decisions were generally made in the best interests of the Organization. Since FY2023, SWIWC has significantly enhanced its procurement practices by implementing updated procurement policies aligned with Uniform Guidance, standardized procurement checklists, documented quote requirements, vendor selection documentation, SAM.gov verification procedures, approval workflows, and centralized procurement files. Staff have also received additional training regarding procurement documentation and federal compliance requirements. Management believes these corrective actions establish a substantially stronger procurement control environment and will support continued compliance with federal procurement standards. Anticipated Completion Date: Implemented 6/30/2026; ongoing monitoring. Responsible Party: Chief Financial Officer and Director of Finance, with applicable Program Managers responsible for providing programmatic documentation.

View Audit 409697

Finding 1227614 (2023-006)

Material Weakness 2023

Village of Maywood

IL

Reporting Subrecipient Monitoring Internal Control / Segregation of Duties § 200.303

The Village acknowledges the recommendation and will continue to strengthen its procedures for identifying and tracking grant activity. Management plans to implement additional review procedures over grant funding sources and related expenditures for purposes of SEFA reporting. The Village will also...

The Village acknowledges the recommendation and will continue to strengthen its procedures for identifying and tracking grant activity. Management plans to implement additional review procedures over grant funding sources and related expenditures for purposes of SEFA reporting. The Village will also consider providing the SEFA and supporting expenditure information to its external engineering consultants for review to help ensure all grant activity administered on behalf of the Village is properly identified and reported.

View Audit 409628

Finding 1227175 (2023-001)

Material Weakness 2023

Hazlehurst City School District

MS

Subrecipient Monitoring Reporting Internal Control / Segregation of Duties § 200.512

AUDITEE’S CORRECTIVE ACTION PLAN As required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost principles, and Audit Requirements for Federal Awards (UG), the Hazlehurst City School District has prepared and hereby submits the following corrective ...

AUDITEE’S CORRECTIVE ACTION PLAN As required by Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost principles, and Audit Requirements for Federal Awards (UG), the Hazlehurst City School District has prepared and hereby submits the following corrective action plan for the findings included in the Schedule of Findings and Questioned Cost for the year ended June 30, 2023: Finding 2023-001 Corrective Action Plan Details A. Contact person responsible for corrective action: Name: Sherry Terry Title: Chief Financial Officer B. Description of corrective action planned: The district will strengthen its internal control systems over reporting to ensure single audit reporting package and data collection form are submitted to the Federal Audit Clearinghouse within established timeframe and financial statements are prepared timely. C. Anticipated completion date of corrective action: Immediately

View Audit 409337

Finding 1226463 (2023-001)

Material Weakness 2023

Educate Maine

ME

Reporting Subrecipient Monitoring

Finding 2023-001: The audit reporting package for the year ended December 31, 2023 has not yet been submitted to the Federal Audit Clearinghouse. Name of contact person responsible for corrective action: Amanda Peterson, Director of Operations and Jason Judd, Ed.D., Executive Director Anticipated co...

Finding 2023-001: The audit reporting package for the year ended December 31, 2023 has not yet been submitted to the Federal Audit Clearinghouse. Name of contact person responsible for corrective action: Amanda Peterson, Director of Operations and Jason Judd, Ed.D., Executive Director Anticipated completion date: September 30, 2025. Corrective Action Plan: Management agrees with the finding and is working on submission of the federal reporting package for the year ended December 31, 2023. The submission of the December 31, 2024 federal reporting package was completed prior to its due date.

View Audit 409098

Finding 1226320 (2023-006)

Material Weakness 2023

Humboldt Park Health, Inc.

IL

HUD Housing Programs Reporting Internal Control / Segregation of Duties

Condition: The Organization did not submit the budget to HUD within 30 days of the start of its fiscal year. Planned Corrective Action: Management has implemented a new review and oversight process related to the process for the documentation submissions to HUD to ensure timely submissions of items ...

Condition: The Organization did not submit the budget to HUD within 30 days of the start of its fiscal year. Planned Corrective Action: Management has implemented a new review and oversight process related to the process for the documentation submissions to HUD to ensure timely submissions of items and to ensure documentation of review of submitted information is retained on a goforward basis. Contact person responsible for corrective action: Louise Arzu, Vice President, Finance Anticipated Completion Date: 9/30/2026

View Audit 408969

Finding 1226319 (2023-005)

Material Weakness 2023

Humboldt Park Health, Inc.

IL

Procurement, Suspension & Debarment Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.214 § 200.303 § 200.317 § 200.318 § 200.327

Condition: Controls were not sufficient to ensure that management has written policies and procedures surrounding procurement that align with Federal Procurement Standards outlined within the Uniform Guidance. Further, controls were not adequate to ensure that the history of procurement decisions wa...

Condition: Controls were not sufficient to ensure that management has written policies and procedures surrounding procurement that align with Federal Procurement Standards outlined within the Uniform Guidance. Further, controls were not adequate to ensure that the history of procurement decisions was documented. Additionally, controls were not sufficient to ensure checks for suspension and debarment were performed and documented before entering into a covered transaction with third parties. Planned Corrective Action: The Organization will update and formally adopt written procurement, suspension, and debarment policies and procedures to conform to Uniform Guidance requirements and implement procedures to ensure those policies are consistently followed and documented for all federally funded procurements. Contact person responsible for corrective action: Louise Arzu, Vice President, Finance Anticipated Completion Date: 9/30/2024

View Audit 408969

Finding 1226318 (2023-004)

Material Weakness 2023

Humboldt Park Health, Inc.

IL

Allowable Costs / Cost Principles Subrecipient Monitoring Reporting § 200.303 § 200.328 § 200.403 § 200.502 § 200.510

Condition: Management lacked adequate controls at the transaction level to ensure compliance with activities allowed or unallowed, allowable cost principles, and period of performance, which resulted in the improper inclusion of duplicate costs and costs from a prior fiscal period. Further, a lack o...

Condition: Management lacked adequate controls at the transaction level to ensure compliance with activities allowed or unallowed, allowable cost principles, and period of performance, which resulted in the improper inclusion of duplicate costs and costs from a prior fiscal period. Further, a lack of effective controls over financial reporting and over preparation of the SEFA resulted in management reporting activity on a cash basis, inconsistent with the basis of reporting established in Note 1 and with requirements established by the passthrough funding agency. Planned Corrective Action: Management will implement a new review, reconciliation and oversight process to ensure that compliance with activities allowed or unallowed, allowable cost principles, and period of performance standards are followed for future grant submissions. Contact person responsible for corrective action: Louise Arzu, Vice President, Finance Anticipated Completion Date: 9/30/2024

View Audit 408969

Finding 1226240 (2023-009)

Material Weakness 2023

Mississippi County, Missouri

MO

Subrecipient Monitoring Reporting Cash Management

The Treasurer has reviewed the corrected SEFA and understands the errors. Funds will be reported accurately in the future.

View Audit 408896

Finding 1226228 (2023-020)

Material Weakness 2023

Central State University

OH

Student Financial Aid Subrecipient Monitoring Eligibility

Corrective Action: The University is actively reviewing and updating policies and procedures regarding eligibility and disbursement controls. The University has implemented various new reports for monitoring and correcting over/under award situations. Responsible Person: Matthew Kirksey, Financial A...

Corrective Action: The University is actively reviewing and updating policies and procedures regarding eligibility and disbursement controls. The University has implemented various new reports for monitoring and correcting over/under award situations. Responsible Person: Matthew Kirksey, Financial Aid Director Completion Date: December 31, 2026

View Audit 408872

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