Corrective Action Plans

Management Response: Management concurs with the auditors’ finding and recommendation and will continue to provide training to staff to ensure expenditures are initially coded correctly to reduce the need for adjusting journals. Detailed and prompt review of grant expenditures will be done at least quarterly and prior to drawdowns and financial reporting being submitted to funding sources.

Finding Number: 2025-018 ALN Number(s) and Program Title(s): 93.575 – Child Care and Development Block Grant 93.596 – Child Care Mandatory and Matching Funds of the Child Care and Development Fund Views of Responsible Officials and Planned Corrective Action: DESE concurs with this finding. Staff turnover resulted in missed reporting on the ACF-696 reports. New procedures have been put into place for cross-training and quarterly reconciliations to prevent future expenditure reporting on the ACF-696 report from being missed. Anticipated Completion Date: Completed. Contact Person: Name: Greg Rogers Title: Chief Fiscal Officer Agency: DESE Address: 4 Capitol Mall, Room 204-A City, State, Zip: Little Rock, AR 72201 Phone Number: 501-682-4475 Email Address: Greg.Rogers@ade.arkansas.gov

PRMP respectfully disagrees with this finding. The responsibility for reporting quarterly drug utilization to manufacturers within 60 days after the end of each quarter, as well as the requirement for manufacturers to remit rebate payments within 30 days of receiving utilization data, is delegated to the Puerto Rico Health Insurance Administration (ASES) through the Memorandum of Understanding (MOU). PRMP is confident in this delegated process, particularly given that it was subject to audit and resulted in no findings for the year ended June 30, 2025. PRMP obtained the Puerto Rico Health Insurance Administration (A Component Unit of the Commonwealth of Puerto Rico) Financial Statements and Compliance Audit of Federal Financial Assistance for the Fiscal Year Ended June 30, 2025, and noted the following opinion: Opinion on Each Major Program (Page 46) We have audited the Puerto Rico Health Insurance Administration’s (the Administration) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the Administration's major federal programs for the year ended June 30, 2025. The Administration's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. In our opinion, the Administration complied, in all material respects, with the types of compliance requirements referred to above. Furthermore, the Medicaid Program initiates reimbursement of drug rebates to CMS once the following conditions are met: - The actuarial team completes its analysis and validation of the allocation of funds to be returned to CMS for each grant and population subject to the applicable FMAP rates. - PRMP receives the corresponding invoice to process refunds to ASES, reflecting the deduction of drug rebate collections. - The Puerto Rico Medicaid Program remits drug rebate funds to the Payment Management System Accordingly, the Puerto Rico Medicaid Program does not concur with the finding asserting that rebate collections were not properly identified, recorded, or credited to the Medicaid Program in a timely manner. Refunds are processed within the same quarter—or at the beginning of the subsequent quarter—following receipt of the final actuarial data, which provides the required distribution and identifies the associated grants. This sequencing ensures that remittances are based on complete, validated information and are aligned with the applicable federal funding allocations.

The PRDOH agreed with the findings and is working with the Finance Department to establish and strengthen our internal controls to ensure all payments comply with the guidelines established by the Federal Government. On the other hand, PRDOH is working and verifying our written procedures to ensure that payments are issued promptly after the drawdown is made.

Conduct a full review of all FEMA funds received in FY 2024-2025 to properly reclassify them as Federal Revenue/Income in the General Ledger. Implement a mandatory review of FEMA Project Worksheets (PWs) and Obligation Notifications to distinguish between "Reimbursements" and "Capital Advances" upon receipt. Create separate General Ledger (GL) accounts for FEMA disaster/project and Federal Funds to track expenditures vs. drawdowns in real-time. Establish a semi-annual meeting between the FEMA Coordinator and Finance departments to verify that all FEMA-funded work performed matches the reported expenditures. Update the SEFA preparation process to ensure FEMA expenditures are reported in the period they were incurred, regardless of when the reimbursement was received. Provide specialized training for the finance team on Federal Funds accounting.

Garfield County School District No. 16 respectfully submits the following corrective action plan for the year ended June 30, 2025. Finding 2025-001 Reporting Significant Deficiency in Internal Control over Compliance and Other Non-Compliance Corrective Action: The District agrees with the finding related to insufficient supporting documentation for the National School Lunch Program reimbursement claims, as it related to sack lunches/field meals. Personnel Responsible for Corrective Action: Jody Williams, Food Service Director Anticipated Completion Date: The District has corrected this issue as of the date of this report, and now requires formal written requests for all sack lunches/field meals, to ensure counts are properly documented.

Federal Program Title: R&D Cluster, Child Care Access Means Parents in School, and TRIO Cluster Assistance Listing Number: R&D, 84.335, and 84.TRIO Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Recommendation: We recommend that the UEC strengthen its cash management and financial reporting procedures to ensure reimbursement requests include only costs incurred in the appropriate fiscal period, are supported by adequate documentation, and are submitted in a timely manner. The UEC should also enhance review controls to verify proper period recognition of costs before submitting reimbursement requests. Views of Responsible Officials: There is no disagreement with the audit finding. Action Taken in Response to Finding: University Enterprises Corporation (UEC) has implemented and is continuing to strengthen internal controls over cash management, reimbursement timing, and supporting documentation. Corrective actions include the implementation of a revised subaward management process to improve documentation, period alignment, and pre-submission review, strengthening controls to ensure reimbursement requests include only costs incurred within the appropriate fiscal period, reinforcing documentation and validation requirements prior to submission, establishing clearer expectations and monitoring for timely reimbursement processing, and clarifying roles and responsibilities to support consistent compliance. Contact(s) Responsible for Corrective Action: Director of Sponsored Programs Administration Planned Completion Date for Corrective Action: June 30, 2026.

Federal Program Title: R&D Cluster and TRIO Cluster Assistance Listing Number: R&D and 84.TRIO Type of Finding: • Significant Deficiency in Internal Control over Compliance Recommendation: We recommend that UEC strengthen its controls over expenditure recognition to ensure costs are recorded in the appropriate fiscal period and enhance payroll review procedures to ensure timesheets are submitted and reviewed in a timely manner to support accurate payroll reporting. Views of Responsible Officials: There is no disagreement with the audit finding. Action Taken in Response to Finding: University Enterprises Corporation (UEC), as the entity responsible for fiscal oversight, compliance, and financial reporting for sponsored programs, has initiated and continues to implement enhancements to strengthen internal controls and ensure expenditures are recorded in the appropriate fiscal period. These actions include strengthening period-end review and accrual practices to improve fiscal accuracy, reinforcing expectations for timely payroll documentation and supervisory review through formal communication and standardized procedures, clarifying roles and responsibilities across UEC and campus partners to support consistent compliance, enhancing documentation standards and internal review processes, and establishing ongoing monitoring to ensure sustained adherence to federal requirements. These efforts build upon recent communications and procedural updates issued to Deans, Principal Investigators, and campus leadership to reinforce compliance expectations and accountability. Contact(s) Responsible for Corrective Action: UEC Executive Director Planned Completion Date for Corrective Action: In action as of February 2026.

Condition: During audit testing of the Sliding Fee Discount Program for the fiscal year ended June 30, 2025, NeoMed Center, Inc. identified deficiencies in the documentation, retention, and supervisory review of patient eligibility determinations. Specifically, patient financial information was updated in a manner that overwrote prior eligibility evaluations, resulting in the loss of historical eligibility records. In addition, patient files were not consistently closed or retained in accordance with established policies and federal program requirements. These conditions reflected weaknesses in internal controls over eligibility documentation and supervisory oversight, which increased the risk of inconsistent application of the sliding fee scale, noncompliance with HRSA Health Center Program and Ryan White Part C requirements, inaccurate patient billing adjustments, and potential misstatement of patient service revenue. Planned Corrective Action: Management implemented corrective actions to strengthen internal controls over the Sliding Fee Discount Program and ensure sustained compliance with applicable federal requirements. Policies and procedures governing eligibility determinations and sliding fee discount applications were revised to require preservation of historical eligibility records, standardized documentation, and proper file‑closure practices. Clear supervisory review responsibilities were established to ensure eligibility determinations and fee assessments are reviewed for accuracy, completeness, and compliance. Targeted training was provided to staff responsible for patient registration, eligibility determinations, and fee assessments to ensure consistent application of the sliding fee scale and adherence to federal program requirements. In addition, management implemented periodic internal reviews of patient files to verify compliance with documentation, retention, and eligibility reassessment requirements, and to promptly identify and remediate any deficiencies. These corrective actions were designed to enhance internal control effectiveness, support accurate financial reporting, and prevent recurrence of the identified condition. Key internal controls include: • Revised and strengthened Sliding Fee Discount Program policies and procedures. • Implemented controls to preserve historical eligibility determinations and documentation. • Established standardized eligibility documentation and file‑closure processes. • Defined supervisory review responsibilities and escalation procedures. • Provided targeted training to eligibility and registration staff. • Implemented periodic internal reviews of patient files to ensure compliance. Monitoring: Management will conduct periodic supervisory reviews of patient eligibility determinations and sliding fee discount applications beginning April 1st, 2026, to ensure compliance with established policies and federal program requirements. Monitoring will include sample testing of patient files to verify proper documentation, preservation of historical eligibility records, and timely reassessments. Results of monitoring activities will be documented and reviewed by management, and corrective actions will be implemented as needed to address any deficiencies identified. Responsible Official: Jose A. Guzman Machuca Time frame: This condition was resolved in March 2026 upon the implementation of revised policies, enhanced documentation controls, staff training, and supervisory review procedures

The Department agrees with the finding. During fiscal year 2024–2025, DHSEM experienced significant turnover within the Finance Bureau, which disrupted established processes for the timely preparation and submission of required SF-425 Federal Financial Reports as required under 2 CFR 200.328. While financial transactions continued to be recorded in the Department’s accounting system, staffing vacancies limited the Department’s capacity to compile, review, and submit certain quarterly reports within the required 30-day timeframe. The untimely submissions primarily impacted reporting periods ended March 31, 2025, and June 30, 2025. The Department acknowledges that reports were not submitted within required deadlines during that period; however, DHSEM is current with all federal financial reporting as of FY2026.To prevent recurrence, DHSEM has strengthened internal controls over federal financial reporting. The Department has implemented a formal supervisory review process for all SF-425 reports prior to submission to ensure completeness, accuracy, and compliance with federal requirements. DHSEM has also established cross-training within the Finance Bureau to ensure alternate personnel are capable of preparing, reviewing, and submitting required reports in the event of staff vacancies or absences.Additionally, the Department has conducted federal financial reporting trainings for Finance and Grants staff and has worked closely with FEMA representatives to ensure alignment with reporting requirements and expectations. DHSEM is revising and formalizing written financial management and reporting policies and procedures to incorporate supervisory review controls, alternate personnel assignments, escalation protocols for reporting deadlines, and standardized documentation of report preparation.These actions are intended to strengthen compliance with federal reporting requirements and ensure timely and accurate submission of financial reports going forward.

Inclusive Ventures Small Business Program – Assistance Listing No. 59-059 Recommendation: We recommend that management develop and implement written procedures to track, record, and report program income, including interest earned on Federal advances. 2660 Riva Road, Suite 200, Annapolis, MD 21401 􀆔 t (410) 222-7410 􀆔 f (410) 222-7415 􀆔 www.aaedc.org Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We recognize the importance of maintaining clear, consistent procedures to ensure that all program income, including interest earned on Federal advances, is properly tracked, recorded, and reported in compliance with applicable requirements. To address this recommendation, management will develop and implement formal written procedures that outline the processes and responsibilities for identifying, documenting, and reporting program income. These procedures will include guidance on calculating and recording interest earned on Federal funds, as well as periodic reconciliation and review controls to ensure accuracy and completeness. In addition, relevant staff will be trained in the new requirements to promote consistent application and ongoing compliance. Name(s) of the contact person(s) responsible for corrective action: Lisa Grunder, Vice President of Administration Planned completion date for corrective action plan: March 23, 2026.

Condition: The Organization lacked written procedures for federal cash management, allowability of costs pertaining to federal funds, procurement, conflicts of interest governing employees involved in federal contract administration, and verification that providers of covered transactions were not suspended, debarred, or otherwise excluded, as required under 2 CFR Sections 200.302, 200.318, and 180.300. Corrective Action Steps: Draft and adopt written federal cash management procedures consistent with 2 CFR Section 200.302(b)(6), including policies for minimizing the time between drawdown and disbursement of federal funds. Draft and adopt allowability of costs policy consistent with 2 CFR Section 200.302(b)(7), identifying the categories of costs allowable under federal awards and the approval process for charging costs to federal programs. Draft and adopt written procurement procedures consistent with 2 CFR Section 200.318(a), including competitive procurement thresholds, documentation requirements, and sole-source justification protocols. Draft and adopt a written standards of conduct / conflicts of interest policy consistent with 2 CFR Section 200.318(c)(1), applicable to all employees involved in the selection, award, and administration of federal contracts. Establish and document a process for verifying that all covered transaction providers are not suspended, debarred, or excluded prior to contract award, and retain evidence of each verification. Responsible Party: CLC NWI Executive Director. Target Date: May 15, 2026

We will reach out to MTAS to help the Town to write and implements a policy for the Federal Awards Program.

COMMONWEALTH OF PUERTO RICO AUTONOMOUS MUNICIPALITY OF VEGA BAJA Corrective Action Plan For the Fiscal Year Ended June 30, 2025 Audit Report: Reports on Compliance and Internal Control in Accordance with Government Auditing Standards and OMB Super Circular Uniform Guidance Audit Period: July 1, 2024 – June 30, 2025 Fiscal Year: 2024-2025 Principal Executive: Hon. Marcos Cruz Molina, Mayor Contact Person: Mr. Edgardo Pérez, Department of Management, Administration and Budget Director Phone: (787)855-2500 Original Finding Number: 2025-003 Statement of Concurrence or Non concurrence: We concur with the findings. Corrective Action: During the past year, the Corrective Action Plan (PAC) has been implemented and expense reconciliation efforts have been ongoing. Currently, we are in the process of collecting all supporting documentation related to work performed for projects funded by FEMA. It is expected that the reconciliation of expenses will be completed over the next few quarters, and that expense reporting will continue during the quarters in which payments are made. Implementation Date: Fiscal Year 2025-2026. Responsible Person: José A. Torres Otero Program Accountant

Condition: Federally funded expenditures were comingled with expenditures paid for with non federally funded sources in the accounting records. Plan: Separate general ledger accounts for federally funded grant expenditures will be accurately maintained. Management Response: The corrective action plan was discussed with the business manager and the superintendent. After discussion, the plan was approved by the superintendent.

2025-001 Unallowable Costs Planned Corrective Action Plan: Heartwood agrees with the finding and acknowledges that two expenditures charged to the Preschool Development Grants (PDG) program were determined to be unallowable under Federal cost principles. To address this issue and prevent similar occurrences in the future, Heartwood will implement the following corrective actions: 1. Enhanced Review Procedures Heartwood will implement additional review procedures for expenditures charged to Federal programs to ensure that all costs are evaluated for allowability under Uniform Guidance (2 CFR §200.403) and the specific terms and conditions of the PDG grant prior to being charged to the grant. 2. Training for Program and Fiscal Staff Program administrators and fiscal staff responsible for processing or approving grant expenditures will receive training on Federal cost principles and allowable expenditures under Uniform Guidance and the PDG program requirements. 3. Monitoring and Oversight Heartwood will require periodic supervisory review of grant expenditures to confirm that costs charged to the program are properly supported, reasonable, and allowable. 4. Review of Current-Year Expenditures Heartwood will review other expenditures charged to the PDG program during the fiscal year to determine whether additional unallowable costs were incurred and will take appropriate corrective action if necessary. 5. Disposition of Questioned Costs Heartwood will work with the pass-through entity or Federal awarding agency to determine the appropriate disposition of the questioned costs totaling $1,467.53, which may include reimbursement to the grant if required. Anticipated Completion Date: December 31, 2026 Responsible Contact Person: Sherri Sampson, Executive Director

Condition: The subsidiary ledger for loans funded by the Federal award programs maintained by the Department did not agree to the City’s general ledger. Corrective Action Planned: The City is actively evaluating a Loan Servicing software package to replace the current offline subledger and anticipate on implementing it in fiscal year 2027. Going forward, Office of Strategic Planning and Community Development (OSPCD) Finance in conjunction with the Auditing Department will train the OSPCD program director and staff on the agreed standard methodology and criteria for recording and reporting new loans and payments in both the subledger and MUNIS. Loan activity will be reconciled to the general ledger to ensure compliance each fiscal year. The City will continue to research discrepancies for CDBG and HOME, make necessary adjustments and plans on resolving the remaining variances in these two program accounts. Anticipated Completion Date: September of 2026 Contact: Alan Inacio, OSPCD Director of Finance and Administration

COMMONWEALTH OF PUERTO RICO MUNICIPALITY OF CATAÑO Corrective Action Plan For the Fiscal Year Ended June 30, 2025 _____________________________________________________________________________________________________________________ Audit Report: Reports on Compliance and Internal Control in Accordance with Government Auditing Standards and OMB Super Circular Uniform Guidance Audit Period: July 1, 2024 – June 30, 2025 Fiscal Year: 2024-2025 Principal Executive: Hon. Julio Alicea Vasallo, Mayor Contact Person: Mrs. Honoris Machado, Finance Director Phone: (787) 788-0404 Original Finding Number: 2025-005 Statement of Concurrence or Nonconcurrence: We concur we the finding. Corrective Action: Adopted Measures • Expense Synchronization: A protocol will be implemented requiring contracted consultants to record and report incurred expenses only when a validated disbursement voucher is available, thereby ensuring the integrity of the financial flow. • Reconciliation: The office will conduct a detailed comparison between the draft quarterly report and the general ledger to identify and correct any discrepancies prior to final submission. • Compliance Timeline: An internal deadline will be established for the submission of the report, ensuring attainment of the minimum percentage required under the Quality Activities category through accurate financial data. Expected Outcome To ensure that all financial information submitted is complete, accurate, and fully aligned with the Municipality’s accounting records, thereby eliminating the risk of audit findings. Implementation Date: March 2026. Responsible persons: • Person responsible for the implementation: Mr. Carlos Flores, Federal Program’s Subdirector • Person responsible for the supervision: Mrs. Yolanda Maldonado, Federal Program’s Director

The organization has developed and implemented a standardized documentation process to ensure that all data submitted is fully supported and traceable to source documentation. Responsible staff have been trained to retain and reference appropriate supporting records for each data element prior to submission. A supervisory review step has been added to verify that documentation is complete, accurate, and clearly tied to the reported data before final submission.

The Senior Accounting and Finance Director and the Director of Operations have scheduled a weekly meeting to address training needs for front-line staff and to develop methods for monitoring data collection and ensuring accountability for data entry. Although procedures and training manuals were developed, staff turnover resulted in the processes and procedures not being consistently followed.

VIEWS OF RESPONSIBLE OFFICIALS Management reviewed the reporting process and identified that the discrepancy resulted from reliance on PMS drawdown and cash-basis payment activity rather than cumulative accrualbased expenditures recorded in SAP. Internal procedures have been revised to ensure that Line 10.e reflects total cumulative expenditure recorded on an accrual basis, consistent with the accounting records. Implemented or Planned Corrective Measures: 1. Management Action: The interim SF-425 for Grant 02TD0022301 was formally reviewed on February 11, 2026, corrected to properly reflect cumulative expenditures in Line 10.e, and resubmitted through the Payment Management System (PMS). 2. Management Meeting: On February 25, 2026, a formal meeting was held with the Fiscal Team, Program Director, Sub-Director, Budget/Fiscal Analyst, and Fiscal Consultant to review the finding and establish the enhanced corrective plan. 3. Corrective Measure Related to Root Cause: The reporting process has been revised to ensure that all SF-425 reports are prepared using cumulative accrual-based expenditure data directly extracted from SAP, consistent with accrual accounting principles and 2 CFR §200.302(b)(2). This enhancement strengthens internal controls over financial reporting in accordance with 2 CFR §200.303 4. Implementation of a formal reconciliation process between the general ledger (SAP), supporting expenditure reports, and the SF-425 prior to submission. 5. Comprehensive Preventive Review: Management initiated a comprehensive review of all SF-425 reports submitted from July 1, 2025, to the present. This review includes reconciliation of Lines 10.e and 10.f to SAP general ledger data to confirm compliance with accrual-based reporting standards. The review will be completed no later than March 30, 2026. Results will be formally documented in accordance with the Federal Reporting Procedures Manual and presented to the Governing Board at its meeting on March 30, 2026. 6. Structural Improvements Implemented: 1. Budget/Fiscal Analyst formally responsible for extracting cumulative data from SAP, preparing SF-425, and completing standardized reconciliation of Lines 10.e and 10.f. 2. Fiscal Consultant responsible for independent review, validation of compliance with 2 CFR §§200.302 and 200.303, certification, and submission in PMS. 3. Implementation of a standardized reconciliation worksheet. 4. Training for fiscal personnel scheduled for March 5, 2026, covering revised procedures and Uniform Guidance requirements. 7. Governance and Monitoring: • Adoption of the formal Federal Reporting Procedures Manual. • Establishment of an Annual Federal Reporting Calendar reviewed monthly. • Monitoring by the Sub-Director with documentation in fiscal meeting minutes. • Formal presentation of the audit finding and revised procedures to the Governing Board on March 30, 2026. 8. All corrective actions are expected to be fully implemented no later than March 30, 2026. IMPLEMENTATION DATE March 30, 2026 RESPONSIBLE PERSONS Margot Vélez Meléndez, Director of Head Start Program

Department: Defense, Veterans and Emergency Management Title: Internal control over DG – PA program financial reporting needs improvement Questioned Costs: None Status: Corrective action in progress Corrective Action: The Department will publish revised Federal financial reporting procedures. The Department will train relevant staff. The Department will implement new Federal Financial Reporting procedures with increased staff resource allocations. Completion Date: April 30, 2026, June 30, 2026, and July 1, 2026, respectively Agency Contact: Sunny Cyr, MEMA Business Office Director, DVEM, 207-707-2507

Department: Health and Human Services Administrative and Financial Services Title: Internal control over Foster Care and Adoption Assistance cash management needs improvement Questioned Costs: None Status: Corrective action in progress Corrective Action: The DHHS Financial Service Center will update the IV-E cash on hand analysis to ensure the cash balances are tracked separately by each of the following Title IV-E programs: Foster Care, Adoption Assistance, Prevention Program and Guardianship Assistance. Completion Date: March 31, 2026 Agency Contact: Sarah Gove, Director, DHHS Service Center, DAFS, 207-458-6626

Department: Health and Human Services Administrative and Financial Services Judicial Branch Title: Internal control over Child Support Services expenditures needs improvement Questioned Costs: None Status: Corrective action in progress Corrective Action: The DHHS and the Maine Judicial Branch will update the Cooperative Agreement to strengthen policies, procedures, and oversight in order to ensure that expenditures are based on actual costs. Completion Date: March 31, 2026 Agency Contact: Jerry Joy, Director, Division of Support Enforcement and Recovery, DHHS, 207- 624-6985

Department: Defense, Veterans and Emergency Management Title: Internal control over National Guard cash management and the related financial reporting needs improvement Questioned Costs: None Status: Corrective action in progress Corrective Action: The Department will improve policies and procedures to follow up on outstanding reimbursement requests to facilitate a more timely reimbursements from the Federal government. The Department will improve policies and procedures, including reconciling reimbursement activity to the State’s accounting system. The Department will improve and maintain effective internal control over Federal awards to provide reasonable assurance that the Department is managing awards in compliance with federal statutes, regulations and the terms and conditions of awards. The Department will review, update and document supervisory oversight. Completion Date: June 30, 2026 (first, second and third items), and May 30, 2026 (fourth item) Agency Contact: Diane Dunn, Commissioner, DVEM, 207- 430-5158