Corrective Action Plans

REPORTING West Virginia Division of Rehabilitation Services (WVDRS) Assistance Listing Number 84.126 WVDRS will review current RSA-17 approval procedures by April 2023 and make appropriate modifications as necessary to ensure all evidence of report approval is maintained within our records.

The District will create general ledger accounts to better segregate and track expenditures specific to grant programs. The District will also have grant expenditures reports reviewed by someone other than the preparer before submission.

DEPARTMENT OF TREASURY 2022-005 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ? Assistance Listing No. 21.027 Recommendation: We recommend the County design controls to ensure review and approval of reports are maintained in the County's grant files. Also, we recommend the County design controls to ensure reports agree to the documentation used to prepare them. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The County has revised internal controls to ensure reports are prepared accurately and consistently with the back-up used to prepare them. Within these internal control procedures, an appropriate review and approval process will be utilized and documented to ensure report is accurate with underlying support documentation and clearly documents this review and approval control. As a primary function of this review and approval control process, the reviewer/approver will provide assurance that the federal award is reasonably being managed and complies with all applicable statues, regulations, and terms and conditions. Evidence of review and approval will be maintained within the grant file support documentation for future reference and to be provided in a timely manner. Name(s) of the contact person(s) responsible for corrective action: Barry Anderson Planned completion date for corrective action plan: June 30, 2023

DEPARTMENT OF TREASURY, CENTERS FOR DISEASE CONTROL AND PREVENTION, AND DEPARTMENT OF HEALTH AND HUMAN SERVICES 2022-003 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ? Assistance Listing No. 21.027 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) ? Assistance Listing No. 93.323 Child Support Enforcement ? Assistance Listing No. 93.563 Recommendation: We recommend the County establish written procedures for determining the allowability of costs to include a written policy regarding the charging of personnel costs to grants. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned in response to finding: The County is currently in the process of drafting and establishing written procedures for county-wide and department specific use when determining the allowability of costs when charging personnel costs to federal awards. A primary function of this policy will be to provide guidance to county staff to ensure personnel costs are recognized in accordance with cost principles, statues, regulations, and terms and conditions of federal awards. Name(s) of the contact person(s) responsible for corrective action: Andrew Copeland Planned completion date for corrective action plan: June 30, 2024

District Response: A. What corrective action will be taken: District will limit expenditures to approved budget amounts. B. Who is responsible (name and position): Dr. Stephen Gregory, Federal Program Director C. When will the plan be implemented? Corrective action started May 5, 2023, and will continue.

Views of Responsible Officials: One of the three entries posted related to the salary allocation addressed in comment 1. The remaining two entries netted to $9,000. While we believe these adjustments are not material, we continue to strive to have no adjustments as part of the audit. Effective for the 2023 audit, all items sent to the auditors will be reviewed by both the outsourced CFO and the principal in charge of the engagement prior to being submitted. The CEO is responsible for overseeing the outsourced accounting team.

FINDING 2022-005 Contact Person Responsible for Corrective Action: Jami Parks and Stacey Teipen Contact Phone Number: 812-794-8750 Views of Responsible Official: We concur with the finding Description of Corrective Action Plan: The school corporation will implement internal controls to prepare, review and retain reports. The stated reporting was completed by both the Corporation Treasurer and Federal Programs Director, but the records were not initialed to show completion and review. Supporting documents will be kept as evidence of the data. Anticipated Completion Date: August 1, 2023

2022-067 Oregon Department of Education Ensure accuracy of federal reporting Federal Awarding Agency: U.S. Department of Education Assistance Listing Number and Name: 84.425C Education Stabilization Fund (COVID-19) Federal Award Numbers and Years: S425C200048; 2020 (COVID-19) Compliance Requirement: Reporting Type of Finding: Significant Deficiency; Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.302(b); 2 CFR 200.303(a) Federal regulations require that federal reports include all activity of the reporting period and be supported by applicable accounting records. Federal regulations also require that the department file a separate report for the Governor?s Emergency Education Relief (GEER) expenditures for the period ending June 30, 2021. The department reported GEER information for the local education areas (LEAs) related to the comprehensive distance learning grant program. LEAs submit reimbursement to the department and this information is tracked in an excel database. The database includes various information, including funding types, dates, and amounts. During FY 2022, the department completed the reports using the database, but incorrectly filtered the data so some expenditures were not captured. This resulted in an underreporting of GEER expenditures by $13.9 million. We recommend department management ensure that accurate expenditure data is submitted to the federal government for federal reporting. MANAGEMENT RESPONSE: We agree with this recommendation. ODE has noted the mistake in data filtering and will remedy to ensure accurate expenditure reporting this year. Annual reporting for GEER will enable this error to be corrected moving forward. Anticipated Completion Date: June 22, 2023 Contact: Cynthia Stinson, Senior Manager of Federal Investments & Pandemic, Renewal Effort, OTLA

2022-029 Oregon Housing and Community Services Ensure accessible documentation to evidence compliance with program requirements Federal Awarding Agency: U.S. Department of the Treasury Assistance Listing Number and Name: 21.023 Emergency Rental Assistance Program (COVID-19) Federal Award Numbers and Years: ERA 1, 2021 (COVID-19) Compliance Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Eligibility Type of Finding: Material Weakness Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.302(a); 2 CFR 200.332(a)(5) Department management is responsible for communicating to subrecipients that they are required to permit the department and auditors access to their records as necessary to ensure the department is compliant with program requirements. To ensure compliance with program requirements, subrecipient records must also be sufficiently detailed. The department passed through $140 million phase one program funds to community action agencies (subrecipients) to provide program delivery. The department performed limited fiscal monitoring during the audit period which included procedures to address compliance with activities allowed and allowable cost requirements for administrative costs. The department did not perform any program monitoring during the audit period which primarily addresses compliance with eligibility requirements. To determine whether the department complied with program requirements for the fiscal year, auditors attempted to reconcile detailed subrecipient ledgers with the intent of selecting and testing sample items at each individual subrecipient organization. We noted issues with two individual subrecipients, resulting in an inability to perform testing procedures over a total of $21,438,521 in program expenditures. For the first subrecipient we were able to reconcile their detailed ledgers to the department?s financial records, however their detailed ledger included pass-through payments to a third organization for program delivery. As a result of the combination of direct and pass-through payments, we were unable to obtain sufficiently detailed data that also reconciled to the department?s financial records to select individual transactions for testing. This subrecipient represents $19,877,962 of the unaudited expenditures. For the second subrecipient we were able to reconcile their detailed ledgers to the department?s financial records and select administrative and program transactions for testing. However, the subrecipient was unresponsive to documentation requests to substantiate expenditures. This subrecipient accounted for $1,560,559 of the unaudited expenditures. We recommend department management obtain and reconcile sufficiently detailed subrecipient ledgers and support to substantiate expenditures to allow for fiscal and program monitoring to ensure subrecipients are administering program funds in accordance with program requirements. MANAGEMENT RESPONSE: We agree with this recommendation. To effectively deliver much needed funds to maintain the housing stability of tens of thousands of Oregonians on the brink of experiencing homelessness during the pandemic, agency staff raced to stand up a first-of-its-kind ?single entry point? program for Oregonians to apply for assistance regardless of zip code. In our efforts to focus on speed we acknowledge that there was insufficient planning and capacity to stand up a large-scale emergency program including sufficient assurances our subrecipients could generate evidence of compliance with program requirements including transaction level details to assist with reconciliation. Oregon?s experience is in line with national findings. According to the January 2021 research brief conducted by the National Low Income Housing Coalition around key program challenges with administering emergency rental assistance programs. Survey respondents listed the two most common limitations to be staff capacity and the completeness of applications. Many agencies leaned on whatever local capacity was available to develop programs, review, and process applications, make payments and conduct outreach. Corrective action plan: OHCS had significant compliance monitoring staff turnover in FY22 leading to incomplete subrecipient monitoring reviews. OHCS completing these reviews would?ve ensured subrecipients had adequate time to produce necessary documentation to evaluate compliance, or if not, subrecipients would?ve been required to take corrective actions. For fiscal compliance, OHCS hired a contractor to perform fiscal monitoring of federal funded Grantees. OHCS also hired fiscal staff to pre-FY22 levels, fully trained them, conducted coordinated working sessions, and reached out to the CAA network for discussions on improving processes. OHCS continues to work with the contractor for much needed assistance in monitoring of back log while internal staff move forward to allow for all monitoring to be back on schedule and coordinating both fiscal and program compliance during future fiscal years. Program compliance employees have been hired and compliance efforts are underway. All providers will have internal compliance visits at regular intervals to ensure they have necessary documents and eligibility is being determined in compliance with program requirements. Additionally regular and ongoing check ins and trainings are being offered by program staff. Finally, program compliance teams are working with the Finance compliance team as well as a contracted expert to develop systems and processes in alignment with the Finance compliance team. As a result of program compliance efforts, a risk evaluation is being developed and incorporated into future contracting decisions. Efforts in hiring and systemic investments in infrastructure, processes, and procedures in addition to partner communications have taken place to ensure agency readiness in the event another emergency occurs. As part of our commitment to continual learning, our OHCS research team is collaborating closely with university and national partners to analyze our ERA program data and findings to see what themes emerge for improvement both nationally and in Oregon. Anticipated Completion Date: December 31, 2023 Contact: Jill Smith, Director of Housing Stabilization Division and Dean Criscola, Controller

2022-027 Oregon Housing and Community Services Ensure Monthly and Quarterly reports are accurate and adequately supported Federal Awarding Agency: U.S. Department of the Treasury Assistance Listing Number and Name: 21.023 Emergency Rental Assistance Program (COVID-19) Federal Award Numbers and Years: ERA 1, 2021; ERA 2, 2021 (COVID-19) Compliance Requirement: Reporting Type of Finding: Material Weakness; Material Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.302(a) and (b)(3); 2 CFR 200.303(a), (c)-(d) Department management is responsible for establishing and maintaining effective internal control that provides reasonable assurance the department is managing, evaluating, and monitoring the federal award in compliance with the terms and conditions of the award and taking prompt action when instances of noncompliance are identified. Additionally, the department is responsible for maintaining records to allow for submission of reports that are accurate and adequately supported. We tested four randomly selected monthly reports and found one report did not accurately report the number of unique households assisted and the amount of the assistance based on the supporting documentation. The department stated the differences were likely due to a transition in subsystem reporting formats and delays in report processing. We tested four quarterly reports, two of which were randomly selected and two of which were judgmentally selected. We found one report where the cumulative obligation amount did not agree to supporting documentation and were not accurate, and one report where the cumulative obligation and cumulative expenditures amounts did not agree to supporting documentation and were not accurate. The department stated these errors were due to erroneously entered information in the federal awarding agency?s reporting portal. Information included in these reports is used by the federal awarding agency to determine whether the department qualifies for receiving reallocation payments, as well as how much of a reallocation would be awarded to the department. Errors in these reports could result in errors in the federal awarding agency?s determination of eligibility for funding, and/or the reallocation formula. We recommend department management update and correct erroneous reports and establish controls to ensure reported amounts are accurate and adequately supported. MANAGEMENT RESPONSE: We agree with this recommendation. Numerous Community Action Agencies (CAAs), after months of exponential growth in program resources without time to strategize and scale operations, reported major capacity issues a chronic backup of applications at the local level. OHCS took the unprecedented step to augment CAA staff to contract with a third-party vendor to clear the backlog. This approach rapidly increased production and moved the federal program closer in line with the state?s then 60-day safe harbor period but came with additional monitoring and reporting challenges. OHCS did meet the reporting timelines and requirements of US Treasury. OHCS relied on information within the applicant tracking system that does have some discrepancies when compared to our accounting records. These discrepancies are due to various factors such as dates within the system causing application activity to be pulled into the reporting detail more than once, or the application tracking system not being updated with the most current payment record information by some grantees disbursing payments. These variances were overcome by relying on our accounting system and records as a control source of actual disbursements. During the audit, it was brought to our attention that the compilation of the application tracking system data at a point in time was not stored to demonstrate the reconciliation with the accounting information. SOS was then not able to verify the application tracking system data figures in one monthly reporting instance that were used to support the numbers reported to US Treasury as the file had likely been overridden. Similarly in one instance, the quarterly cumulative report was also impacted, however future cumulative figures were reported correctly. Corrective action plan: While OHCS submitted monthly and quarterly reports since program inception that include program and fiscal information, we acknowledge that there were some discrepancies between systems when one file was overridden with new information and one other file contained an error. We have taken steps to ensure data integrity and records retention moving forward and future compilations of the application tracking system data will be stored to support the point in time reconciliations and figures reported to US Treasury. One quarterly report will also be refiled if allowable by US Treasury to ensure quarterly figures reported are accurate. Data integrity is of the utmost importance to the agency, and we appreciate the thorough review by the auditing team. Anticipated Completion Date: June 30, 2023 Contact: Beth Brown, Accounting Manager

Personnel Responsible for Corrective Action: Ivan Lundberg, Director of Finance Anticipated Completion Date: November 30, 2022 Corrective Action Plan: The Director of Finance will document expected expenditures tied to advance drawdowns from NEA grants. These expenditures will be monitored to ensure that they are completed within 30 days of the advance request. M-AAA will receive approval from the NEA if any expenditures are expected to exceed the 30 day time limit.

2022-002 Internal Control over Compliance and Compliance with Reporting (Preparation of Schedule of Expenditures of Federal Awards) Auditor Recommendation: We recommend management attend Federal award trainings and information to ensure the documented policies and procedures can be performed as described. This will ensure the Federal funds are reported accurately on the SEFA and that programs are reported under the correct assistance listing number. Corrective Action: The year ended August 31, 2022 was the first year in which the Center expended federal awards in excess of the limit that requires a Single Audit. Since receiving the EIDL loan, the Center maintained detailed tracking and documentation of all disbursements associated with the loan and understood such expenditures exceeded the $750,000 threshold for a Singe Audit during the fiscal year ended August 31, 2022. With the clarification of the specific rules surrounding the disclosure of EIDL loans on the SEFA, management will continue to review Federal Award guidance and requirements to ensure compliance with current and future federal awards. Name of Responsible Contacts: Larry Goodpaster, Director of Finance & Operations, and Kelly Martin, Accounting Manager Projected Implementation Date: May 1, 2023 and ongoing

FINDING 2022-005: CAFETERIA NUTRITION CLUSTER REPORTING The Deputy Treasurer prints, verifies, initials the Employee Trial Balance Report (Payroll Report) every pay period. The Treasurer reviews these reports, but has not initialed them. Corrective Action Plan: The Treasurer will begin reviewing and initialing these reports for FY 2023. The Cafeteria Director will submit the child reimbursement form to Central Office for review and verification prior to submission for payment to the Indiana School Lunch Program for FY 2023.

FINDING 2022-008 Contact Person Responsible for Corrective Action: Dan Durrwachter Contact Phone Number: 765-473-3081 Views of Responsible Official: We agree with these findings. Description of Corrective Action Plan: The financial specialist will prepare a report the data for the reports and will be approved by the treasure to ensure accurate FTE is reported before submitting the reports. Anticipated Completion Date: : 6/01/2023

FINDING 2022-004 Contact Person Responsible for Corrective Action: Danny Yost Contact Phone Number: 812-285-6221 We concur with this finding. The Auditor's Office will work with the County Attorney to add an extra layer of control to ensure the accuracy of the reporting. Anticipated Completion Date: Jan. 2024

Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Financial Assistance Listing Number: 21.027 Federal Agency: U.S. Department of Treasury Award Year: 2021/22 Grant Number: N/A Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency in Internal Control and Instance of Noncompliance Cause: The City?s procedures did not ensure the required written procedures were developed and implemented in accordance with the Uniform Guidance. Recommendation: We recommend the City establish policies and formalize written procedures related to allowable costs in accordance with Subpart E ? Cost Principles. Management Response and Corrective Action: The City of Laguna Beach's Administrative Policies already incorporate Special Procedures for Procurement for Federally Funded Projects and Purchases. These procedures ensure compliance with all relevant Federal requirements when the City expends Federal funds. To further enhance our compliance efforts, management will update the City's Administrative Policies to include additional procedures for determining the allowability of costs in accordance with the conditions of Federal Awards. Name of Responsible Official: Julie Nemes Director of Finance and Technology Services Implementation Date: June 2023

Finding # 2022-001 Type: Federal award, Significant Deficiency over Schedule of Expenditures of Federal Awards (SEFA) Finding The Organization did not identify all federal awards and significant audit adjustments were required to the SEFA prepared by management. Recommendation: The Organization should implement additional procedures and review controls to accurately capture all activity under federal awards in preparing the SEFA. Corrective Action: The Organization plans to improve its controls over the preparation and review of the SEFA and will work with funders to make sure there is a clear understanding of the origin of funding in the agreements. Anticipated Completion Date: June 2023

FINDING 2022-009 Contact Person Responsible for Corrective Action: Whitney Dixon, Treasurer Contact Phone Number: 574-533-8631 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Documentation to support reporting data will be prepared by the business office. Full-time equivalent positions will be reviewed by the Human Resources department to ensure that the FTE positions reported are accurate. This will be signed by the preparer, Human Resources, and the program administrator. All ledger expenditures will be included in any report requirement. The prepared report and supporting documentation will be reviewed and approved by Assistant Superintendent, Tracey Noe. Anticipated Completion Date: May 2023

County Judge/Executive?s Response: The fiscal court would like to point out that ARPA funds were properly distributed. During this time there was little guidance on how to manage the reporting. All reporting has been corrected.

Views of Responsible Officials: Management agrees with the finding and will provide additional training and implement procedures to ensure the grant tracking spreadsheets are reviewed appropriately.

Seaway Valley Prevention Council has implemented a system that identifies the source of each funding stream the agency receives or is in the process of completing a request for awards for. This system allows for early determination of the need for a federal single audit. If a funding stream source is identified as originating from a federal award, then all related information is recorded as well as retention of all federal funding requirements related to the federal assistance listing number.

2022-002 Significant Deficiency Name of contact person: Erin Benson, Executive Director Corrective Action: The Organization has been placed on high-risk status by Maine DOL and adopted new policies in conjunction with Maine DOL. The Organization is working with Maine DOL to develop a program to properly train and oversee staff and board members to ensure drawdowns are filed timely and accurately. Proposed implementation date: The corrective action plan has been implemented and is being followed at this time.

Recommendation: The Auditor noted the Organization should consider implementing policies, procedures, and internal controls specific to federal awards which are in writing and are approved by the appropriate level of management or those charged with governance. Planned Corrective Action: Management agrees with the recommendation and has implemented the following steps. A procurement policy, compliant with the Procurement Standards codified in 2 C.F.R. ? 200.317 through ? 200.327 has been approved by the Board of Directors. This policy states the procedures required for documentation for procurement of goods and services related to all Federal awards. Specific additional procedures have been implemented providing an additional level of review for all Federal expenditures, including a quarterly reconciliation of reporting submitted to the granter.

Recommendation: CLA recommends the County implement tracking procedures to ensure all federal expenditures are reported on the Schedule of Expenditures of Federal Awards. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The County is reviewing their processes to implement procedures to track federal expenditures reported in the SEFA. The Accounting and Grants Manager will take a more active role in the SEFA preparation to confirm balances reported with all external and internal departments in a timely manner. The County will also obtain further assistance from an outside contracted CPA firm. Name(s) of the contact person(s) responsible for corrective action: Sherri Crow, Interim Director of Budget and Finance. Planned completion date for corrective action plan: January 1, 2024

Recommendation We recommend the Village review the instructions for completion of the federal financial reports with training provided to the program staff preparing and reviewing the federal financial reports to ensure submitted reports are complete and timely. Management Response Corrective Action: The Village recognizes the need for improved oversight of its grant-funded capital projects and has hired a full-time Grant Writer/Administrator who will work in conjunction with the Clerk and Finance Director to monitor grant activities, submit reports and requests for payment in a timely manner, and ensure all program requirements are met. Village staff will receive training on the reporting and administration requirements of grant-funded programs. Village staff will maintain regular communication with funding agency liaisons to ensure that required reports are prepared accurately and submitted timely. Due Date of Completion: June 2023 Responsible Party: Finance Director and Village Clerk