Corrective Action Plans

FAIN (Federal Award Identification Number) and Federal Award Date: The following action has been implemented to include the FAIN & Award date on all awards for ALN 20.509: All awards executed for Public Transit will include a “Grant Insert Sheet”. The Grant Insert Sheet will be identified on the Part 1 Grant award detail document. Box “36” titled FAIN, will include text that reads “See attachment B”. The Grant Insert Sheet is a document that is completed by the Public Transit Unit and is provided to the Grants Unit for award execution. This sheet includes detailed information related to the award. To address the deficiency, The Grant Insert sheet has been updated to include FAIN Numbers and the Federal Award Date. To ensure the Agency of Transportation meets this compliance requirement, the Grants Unit will verify this information is included prior to award execution. Anticipated completion date: This action went into effect as of January 12, 2024. Person Responsible for Corrective Action: Ross MacDonald, Public Transit Program Manager ross.macdonald@vermont.gov Tricia Scribner, Grants Unit Manager tricia.scribner@vermont.gov Management Review Schedules In the past, The Public Transit Program has used the State Fiscal year for the timing/scheduling of the 3-year Management Reviews. For example, if the completion of the last Management Review occurred in FY 2020, then we would ensure a new Management Review began at any time during FY2023. We understand this could lead to more than exactly 3 years between these reviews. Due to this finding, we will now establish a starting month/date for each provider, with 3-year intervals between the start of each Management Review. We have attached the updated schedule and will adhere to this from this day forward. Anticipated completion date: As of December 27, 2023, the updated Management Review Schedule is in effect. Person Responsible for Corrective Action: Ross MacDonald, Public Transit Program Manager ross.macdonald@vermont.gov

The Agency had last year recognized a need to provide training and technical assistance to State Agencies and Departments. The Agency provided Uniform Guidance training in February and March of 2023. The Agency developed and delivered a subrecipient monitoring framework which included tools to facilitate subrecipient risk assessments, subrecipient monitoring plans based on the initial risk assessments, testing of transaction records, desk reviews of subrecipients, and corrective action plans. The Agency performed desk reviews for agencies and departments in the first six months of Fiscal Year 2024. As part of the desk review process, preliminary reports are issued, mitigation opportunities are presented, mitigation opportunities are implemented as appropriate, and final reports are shared across staff and management. The Agency will continue to provide oversight and monitoring for agency adherence to subrecipient monitoring procedures, informed by our ongoing agency and program-level compliance risk assessments, which include factors such as program complexity and history of audit findings. Scheduled Completion Date of Corrective Action Plan: Completed: July, 2023: Subrecipient Monitoring Framework Provided to Agencies & Departments Completed: December, 2023: Sampling completed by Agency Expected: April, 2024: Post-Sampling Follow-up with Agencies and Departments Expected: June, 2024: Continuing Monitoring and Technical Assistance Processes Expected: June, 2024: Additional Training for Agencies and Departments Contacts for Corrective Action Plan: Douglas Farnham Chief Recovery Officer, Vermont State Recovery Office Douglas.Farnham@vermont.gov (802) 585-8119 Ethan Hurley Director of Finance & Operations, Vermont State Recovery Office Ethan.Hurley@vermont.gov (802) 461-5317

The reporting portal of the U.S. Treasury changes on an almost quarterly basis. These changes include new data requirements, added/changed functionality, and new data verification mechanisms. The incredibly small group of dedicated reporters for the Agency does their best to ensure that every new change in the portal process is recognized and incorporated into our processes and that the data in the portal matches what we have on file. Regarding the reporting period in question, current period obligations were inadvertently not reported at the individual project level due to an error in an internal data query used to generate the project upload templates used to enter data into the portal. The error went unnoticed by Agency staff partially because verification of cumulative obligations and total current period obligations, which is automatically verified in the portal and double checked by Agency staff, was successful which suggested there were no issues with the uploaded data. After researching the issue, Agency staff discovered that the data provided at the project level is not used in any auto calculations in the portal and there are no verification mechanisms in place within the portal to ensure it is accurate. Moving forward, the Agency will initiate a new process. A primary review of the templates will be conducted by an individual other than the individual that has prepared the templates before uploading. Additionally, a review of the portal data by a multi-person team will be completed before the portal data is certified. Scheduled Completion Date of Corrective Action Plan: Expected: April, 2024: New processes integrated into FY24 Q3 Reporting Cycle Contacts for Corrective Action Plan: Douglas Farnham Chief Recovery Officer, Vermont State Recovery Office Douglas.Farnham@vermont.gov (802) 585-8119 Ethan Hurley Director of Finance & Operations, Vermont State Recovery Office Ethan.Hurley@vermont.gov (802) 461-5317

The Department will review its procedures and internal controls and update as necessary to ensure that expenditures are incurred within the allowable period of performance for respective awards. It should be noted that during the period of performance for which this audit was conducted there were a large number of personnel changes and shifts. The position that was responsible for the majority of these duties retired in January 2024. We proactively hired for her replacement a year before she retired. Over the course of the year our replacement took over more and more duties. In the process of this replacement, we have completed a tremendous amount of evaluation of our assigned duties, processes, workflow, training, and documentation. Not only in this role, but we are also undergoing a division and business unit wide analysis of our internal controls and workflow. It should also be noted that the UI admin funds are considered ‘formula funds’ from the US DOL. We are expected to run this program year-round with no gaps in service or performance. The funding that we receive from US DOL is based on an antiquated formula that breaks down the amount that is budgeted by Congress between 52 state and territories. We generally do not receive enough funding for the entire year. Also, with the recent trend of Congress to utilize the tool of the Continuing Resolution our funding is often ambiguous until most of the program year is over. We have at times seen our funding cut once a budget had been passed by Congress even though there was only about 3 months left in the program year. We are still expected to run this program and ‘find other sources of funding’. This does make the adherence to the period of performance challenging. However, as we evaluate our internal controls and procedures over the coming months, we will make note of every opportunity to strengthen this function to ensure that all charges applied to program funds are relevant, within the period of performance of the award, and are correctly reviewed and signed. Cameron Wood, UI Director, Cameron.Wood@vermont.gov Scheduled Completion Date of Corrective Action Plan: August 31, 2024

The Department will review its procedures and internal controls and update as necessary to ensure that expenditures are adequately reviewed and signed off on. It should be noted that during the period of performance for which this audit was conducted there were a large number of personnel changes and shifts. The position that was responsible for the majority of these duties retired in January 2024. We proactively hired for her replacement a year before she retired. Over the course of the year our replacement took over more and more duties. In the process of this replacement, we have completed a tremendous amount of evaluation of our assigned duties, processes, workflow, training, and documentation. Not only in this role, but we are also undergoing a division and business unit wide analysis of our internal controls and workflow. Cameron Wood, UI Director, Cameron.Wood@vermont.gov Scheduled Completion Date of Corrective Action Plan: August 31, 2024

In 2015, the Department lost access to certain federal IRS information, including the ability to store electronic federal tax information on the Department’s internal information technology servers. Subsequent to 2015, the Department has maintained a physical copy of the annual IRS 940 FUTA match file for auditing purposes. This year, the Department did not maintain that file. The Department will review current procedures and internal controls with the Agency of Digital Services and update as necessary to ensure that a copy of the IRS 940 FUTA match file is maintained for auditing purposes. Cameron Wood, UI Director, Cameron.Wood@vermont.gov Scheduled Completion Date of Corrective Action Plan: August 31, 2024

The Department is currently undergoing a division and business unit wide analysis of our internal controls and procedures. As part of that effort, the Department will review internal controls and update as necessary to ensure that all required reports are filed timely and accurately and that reports are reviewed and approved by authorized State officials prior to submission. Cameron Wood, UI Director, Cameron.Wood@vermont.gov Scheduled Completion Date of Corrective Action Plan: August 31, 2024

In March 2023, AOE implemented a new process that is more automated to ensure accuracy and timeliness of our CMIA draws. We have created a new draw sheet that will be more easily loaded and will be reconciled a couple times a year. The Deputy CFO or person assigned by the Deputy CFO will perform a reconciliation at least two times a year. Name: Sean Cousino Position: Deputy CFO Email: sean.couisno@vermont.gov Phone Number: 802 595-3693 Date of Implementation of Corrective Action: March 15, 2023

To address the accuracy and timeliness of our entries into the FFATA system, we will use the USASPENDING.GOV website to assist us in reconciling what has been entered into the FFATA system.  This will allow us to ensure that our grant ledgers agree with what is entered into FFATA. In March 2023 we started reconciliations and plan to continue reconciling a couple times each year.  The work will be done by the Deputy CFO or position assigned by the Deputy CFO.   We will also implement a process that will have all the steps necessary for a grant award or an amendment to ensure it is posted properly within our internal files and the external systems. This will ensure that new awards and amendments get routed and entered in the FFATA system timely. We will look into the Batch upload process to allow for data to be entered into the system easier. Name: Sean Cousino Position: Deputy CFO Email: sean.couisno@vermont.gov Phone Number: 802 595-3693 Date of Implementation of Corrective Action: 5/01/2024

FINDING 2023-004 Finding Subject: COVID-19 – Education Stabilization Fund – Equipment and Real Property Management Summary of Finding: Equipment purchased with ESF grant awards, although accounted for in the capital asset listing, were not properly identified with the source of the funding, who holds title, percentage of federal participation in the project costs, etc. Contact Person Responsible for Corrective Action: Debra Elder, Treasurer and John Scioldo, Superintendent Contact Phone Number and Email Address: 812-547-3300; debbie.elder@tellcity.k12.in.us and john.scioldo@tellcity.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: We will reach out to AdTec, the company the school corporation works with on the updating of the capital asset records, to request that they add the missing information to the capital asset listing for said purchased equipment as described in greater detail in the audit finding. It is our goal to have this completed by the end of the July 2023 – June 2025 audit cycle. Anticipated Completion Date: No later than June 30, 2025

FINDING 2023-003 Finding Subject: Child Nutrition Cluster – Special Tests and Provision – Verification of Free and Reduced Price Applications (NSLP) Summary of Finding: The finding was isolated to school year 2023 in which one employee is to determine the number of applications to be verified, select the required applications and perform verifications of eligibility, with a second employee reviewing the verifications. Contact Person Responsible for Corrective Action: Kathy VanHoosier, ECA Manager Contact Phone Number and Email Address: 812-547-3300; kathy.vanhoosier@tellcity.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The process of selecting and performing verifications of eligibility with a second employee reviewing the verifications was refined and fully implemented for school year 2023/2024. A change in personnel since the 2022/2023 improved this process, and sign-offs were done and initialed by both the initial reviewer (the Central Office manager) as well as the final reviewer (the ECA Manager) on the 2023/24 applications. It is the intent to continue with this improved internal control process going forward. Anticipated Completion Date: Already Done in Fall 2023

Condition: From a sample of sixty providers, nine of the providers did not have a recertification survey completed within the required timeframe which is used to meet the provider health and safety standards. Recommendation: We recommend the State train all staff members to properly verify providers are meeting the prescribed health and safety standards before making payments to those providers. Views of responsible officials: KDHE/Bureau of Facilities and Licensing (BFL) recognizes the recertification survey deadlines was not met for nine of the sixty non-deemed acute and continuing care providers and supplier types included in this audit consisting of Hospitals, Critical Access Hospitals (CAH), Ambulatory Surgery Centers (ASC), End Stage Renal Disease Facilities (ESRD), Rural Health Clinics (RHC), Hospice and or Home Health Agencies (HHA). The KDHE/BFL would like to clarify that Section 1865(a)(1) of the Social Security Act (the Act) permits providers and suppliers "accredited" or "deemed" by an approved national accreditation organization (AO) to be exempt from routine surveys by State survey agencies to determine compliance with Medicare conditions. Accreditation by an AO is voluntary and is not required for Medicare certification or participation in the Medicare Program.) There is no disagreement with the audit finding but KDHE/BFL does want to identify some of the challenges the State Survey Agency (SSA) faces hindering continued progress with corrective action plans. CMS’s annual appropriation to the SSA has remained unchanged since FY 2015. This has significantly limited the SSA’s capacity to conduct initial, complaint, recertification, and validation surveys. This limitation in funding, coupled with the continuing effects of the COVID-19 Public Health Emergency (PHE), accelerated the loss of SSA surveyor resources and resulted in an ongoing survey backlog. As complaints about provider and supplier quality of care increases, non-statutory recertification surveys and less severe complaint allegations receive a lower priority. Complaint surveys, especially those alleging immediate jeopardy or actual harm to patient health and safety are the primary oversight provided, outside of statutory recertification surveys. These investigations of the most serious allegations also lead to more severe findings, higher numbers of revisits, and additional enforcement workload. Complaint surveys are the primary oversight mechanism for most provider types. CMS has established the following priorities for the SSA’s: 1. Investigation of patient complaints, as these are active quality concerns that must be reviewed to protect the health and safety of the public. 2. Survey and recertification of statutory facilities such as home health agencies (HHAs), and hospices as required by current law; and 3. Survey and recertification of non-statutory facilities, as required by CMS policy with consideration of available funding once priorities one and two have been accomplished. Action taken in response to finding: At the beginning of each federal fiscal year including current FFY24, the BFL utilizes the CMS Mission and Priority Document (MPD) which directs and outlines the work of the SA based on regulatory changes, adjustments in budget allocations, and new initiatives, as well as new requirements based on statutes to prioritize and categorize survey plans. During this current FFY we have begun to restructure the program adding additional program manager positions, health facility surveyors, contracted services, and other support staff. Our goal is always to be able to consistently meet our Tier 1 priority with an emphasis on Tier 2. Recruitment, training, fiscal management & strategies are always a priority and part of action plans to meet these goals. The SSA goals for FFY24: • Complete 100% of the ESRD surveys in Tier 2 provided on the required Outcomes List. Kansas currently has approximately 60 non-deemed ESRD suppliers. • Complete to the extent possible 5% of non-deemed RHCs based on state judgment prioritizing those RHCs most at risk of quality problems for Tier 2. Kansas currently has approximately 135 RHC suppliers. • Complete to the extent possible based on the state’s judgement prioritizing those at risk of quality problems a standard recertification survey with a maximum interval between surveys for any one particular HHA of 36.9 months to meet Tier 1 requirements. Kansas currently has approximately 70 non-deemed, certified HHA’s. • Complete to the extent possible based on the state’s judgement prioritizing those at risk of quality problems a standard recertification survey with a maximum interval between surveys for any one particular Hospice of 36 months to meet Tier 1 requirements. Kansas currently has approximately 50 non-deemed, certified Hospice providers • Complete to the extent possible based on the state’s judgement prioritizing those at risk of quality problems a standard recertification survey at least one, but not less than 5% of the non-deemed hospitals, 5% of the non-deemed psychiatric hospitals, and 5% of non-deemed CAHs. Kansas currently has approximately 74 non-deemed CAHs, 2 Psychiatric/Rehab non-deemed hospitals and 12 non-deemed hospitals. Name(s) of the contact person(s) responsible for corrective action: Jerry Smith, Bureau Director, Bureau of Facilities and Licensing, KDHE, Gerald.Smith@ks.gov Marilyn St Peter, RN, Deputy Director, Bureau of Facilities and Licensing, KDHE, Marilyn.St.Peter@ks.gov Planned completion date for corrective action plan: June 30, 2024

Condition: Management did not track, determine or monitor the audit verification requirement for any subrecipients. Recommendation: We recommend that the agency review its procedures for monitoring of annual audits for subrecipients. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: Effective immediately, audit letters will be sent to all subrecipients without regard to monetary thresholds. Name(s) of the contact person(s) responsible for corrective action: Jennifer Deal Planned completion date for corrective action plan: July 1, 2024

Condition: Subaward agreements with subrecipients, including Assistance Listing Number (ALN) and title, subrecipient’s DUNS/UEI number, Federal Award Identification Number (FAIN), identification of whether the award is research and development, and indirect cost rate for federal award, were not included. Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: KDEM is implementing a comprehensive compliance program. The program will oversee that appropriate communication is made to subrecipients as required to be in compliance with 2 CFR 200.331(a). Name(s) of the contact person(s) responsible for corrective action: Jennifer Deal Planned completion date for corrective action plan: July 1, 2024

Condition: During testing, we noted that FFATA reports were not submitted timely, FFATA reports were not submitted at all, and there was not a documented review of the submitted reports Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 33 14 33 14 not reported 14 not reported Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $2,775,992 $961,031 $2,775,992 $961,031 Not Reported $961,031 Not Reported Recommendation: We recommend that the agency implement controls to ensure subrecipients provide a UEI number before the subaward is entered into and implement procedures to ensure reports are submitted timely and formally reviewed. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: KDEM is implementing a comprehensive compliance program. The program will oversee that the completed application is received which includes the UEI. The compliance officer will then ensure that all FFATA reporting is completed and documented timely. Name(s) of the contact person(s) responsible for corrective action: Jennifer Deal Planned completion date for corrective action plan: July 1, 2024

Condition: During testing, we noted that FFATA reports were not submitted timely and there was not a documented review of the submitted reports. Also, we noted that the State also has submitted FFATA Reports to FSRS for vendors when this reporting is not required for vendors. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 6 0 6 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $2,291,464 $0 $2,291,464 0 0 Recommendation: We recommend that the agency implement controls to ensure reports are reviewed before submission, that a process is updated to ensure that reports are submitted timely, and that a process is implemented to ensure only subawards are reported to FSRS. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: The agency has put a review/approval workflow process in place for reports. The report will be entered into FSRS.gov and sent to a reviewer. Once the report has been reviewed and approved, an email will be sent to Fiscal Analyst as proof the reports have been reviewed/approved. The email will be retained for audit reviews. Name(s) of the contact person(s) responsible for corrective action: Joy Duncan Planned completion date for corrective action plan: The review process will begin immediately in March 2024.

Condition: During testing it was discovered that management did not document the review of the submitted reports. Also, we noted that the State also has submitted FFATA Reports to FSRS for vendors when this reporting is not required for vendors. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 1 0 0 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $41,680 0 0 0 0 Recommendation: We recommend that the agency implement controls to ensure reports are reviewed before submission and that a process is implemented to ensure only subawards are reported to FSRS. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: The agency has put a review/approval workflow process in place for reports. The report will be entered into FSRS.gov and sent to a reviewer. Once the report has been reviewed and approved, an email will be sent to Fiscal Analyst as proof the reports have been reviewed/approved. The email will be retained for audit reviews. Name(s) of the contact person(s) responsible for corrective action: Joy Duncan Planned completion date for corrective action plan: The review process will begin immediately in March 2024.

Condition: During our testing of twenty-seven covered transactions (twelve vendors and fifteen subrecipients), we noted that management was not able to provide supporting documentation for one vendor that suspension and debarment procedures were performed before the start of the procurement contract. Recommendation: We recommend the agency either obtain certifications from vendors stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on the SAM website. We recommend that the agency have proper procedures in place to ensure that all contractual documentation is maintained and able to be located. Views of responsible officials: Management disagrees with the audit finding. Verification is completed at the time the contract is signed by KDHE so the date of signature corresponds with the date of SAM verification. Action taken in response to finding: KDHE has implemented a new contract system which will include steps for verifying suspension and debarment status for all contracts and sub-recipient agreements which KDHE is a party to. Name(s) of the contact person(s) responsible for corrective action: Kelly Chilson Planned completion date for corrective action plan: October 2023

Condition: During our testing, we noted subrecipients had required information omitted from the sub agreements to the subrecipients including Assistance Listing Number (ALN) and title, subrecipient’s DUNS/UEI number, Federal Award Identification Number (FAIN), identification of whether the award is R&D, and indirect cost rate for federal award. Recommendation: We recommend that the agency review its procedures for communicating information to subrecipients and implement the procedures necessary to ensure information is included in the subrecipient award documents at time of funding. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: A cover sheet with the required information to be provided to the subrecipients has been created. Name(s) of the contact person(s) responsible for corrective action: Program personnel Planned completion date for corrective action plan: Implementation will begin immediately in March 2024.

Condition: During our testing of performance reports, we noted five out the five tested reports lacked documentation of review. Recommendation: We recommend the agency implement procedures to ensure reports are properly reviewed as well as increase training efforts on reporting requirements if there is future staffing turnover. Views of responsible officials: Management disagrees with the audit finding. There is review and final approval of these quarterly financial reports by the ELC program director prior to submission. The fiscal analyst at KDHE provides these financial reports to the ELC program manager and the ELC program director. The COVID and CORE ELC data from these reports are manually entered into ELC RedCap (for the years that correspond to this audit) and now ELC CAMP. COVID financial reports are then uploaded into GrantSolutions; the core ELC financial reports do not have to be uploaded to GrantSolutions. There is no mechanism to include a signature on these reports, but submission to ELC CAMP and GrantSolutions indicate the reports have been reviewed. Action taken in response to finding: An email advising reports have been reviewed and approved by the program director will be sent to the program manager as proof the reports have been reviewed/approved and are ready to be submitted. The email will be retained for audit reviews. Name(s) of the contact person(s) responsible for corrective action: Sheri Tubach Planned completion date for corrective action plan: Immediately in March 2024.

Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) reports, it was noted that the reports were not filed timely or not filed at all for the fiscal year. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 8 1 8 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 6,046,626 $ 166,455 $ 6,046,626 $ 0 $ 0 Recommendation: We recommend that KDCF continue with the process implemented during the fiscal year, that includes tracking the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: KDCF hired a dedicated person in May 2023 to complete the FFATA reporting process. This employee received access to the FSRS website in July 2023 and began entering the FFATA information for new awards. The information captured on the FFATA Checklist and FFATA-5 forms will be used to enter subrecipient information into the FSRS website. Previously, these forms were not always accurate in listing the correct FAIN and amount for each federal award. KDCF has revised this form to include a separate listing for each federal amount awarded and the information will be verified during the concurrence approval process for accuracy. Once concurrence has been completed and any corrections identified, the FFATA reporting details will be added to the FFATA tracking worksheet. KDCF has created a separate tracking worksheet for each state fiscal year which includes separate tabs for each DCF program. This information will be entered into the FSRS website in the reporting month of the award date under each FAIN identified within the required due date. The FFATA information entered will be reviewed on the USA Spending public site for accuracy and corrected as needed. KDCF staff will continue working on updating prior year FFATA information throughout the year identified in previous audits. Name(s) of the contact person(s) responsible for corrective action: Brian Carlgren, Deputy Director of Fiscal Services Addie O’Connell, Grant and Contract Specialist Planned completion date for corrective action plan: July 2024

Condition: During testing of the Federal Funding Accountability and Transparency Act (FFATA) report, it was noted that the one report tested was not filed timely. Transactions Tested Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements 1 0 1 0 0 Dollar Amount of Tested Transactions Subaward Not Reported Report Not Timely Subaward Amount Incorrect Subaward Missing Key Elements $ 5,850,379 $ 0 $ 5,850,379 $ 0 $ 0 Recommendation: We recommend that KDCF continue with the process implemented during the fiscal year, which includes tracking the timely submission of the FFATA reports. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: KDCF hired a dedicated person in May 2023 to complete the FFATA reporting process. This employee received access to the FSRS website in July 2023 and began entering the FFATA information for new awards. The information captured on the FFATA Checklist and FFATA-5 forms will be used to enter subrecipient information into the FSRS website. Previously, these forms were not always accurate in listing the correct FAIN and amount for each federal award. KDCF has revised this form to include a separate listing for each federal amount awarded and the information will be verified during the concurrence approval process for accuracy. Once concurrence has been completed and any corrections identified, the FFATA reporting details will be added to the FFATA tracking worksheet. KDCF has created a separate tracking worksheet for each state fiscal year which includes separate tabs for each DCF program. This information will be entered into the FSRS website in the reporting month of the award date under each FAIN identified within the required due date. The FFATA information entered will be reviewed on the USA Spending public site for accuracy and corrected as needed. KDCF staff will continue working on updating prior year FFATA information throughout the year identified in previous audits. Name(s) of the contact person(s) responsible for corrective action: Brian Carlgren, Deputy Director of Fiscal Services Addie O’Connell, Grant and Contract Specialist Planned completion date for corrective action plan: July 2024

Condition: During testing of eligibility, the following items were noted: • Two beneficiaries had income entered incorrectly, causing the benefits to be overstated. • One beneficiary had income entered incorrectly but there was no impact on the benefit. • One beneficiary’s income was not entered for consideration, which caused the beneficiary to be incorrectly labeled as eligible. Recommendation: We recommend that KDCF strengthen internal controls in place to mitigate this from happening in the future. Views of responsible officials: There is no disagreement with the audit finding. Action taken in response to finding: Below are the determined causes for the identified errors. • Failure to review application and supporting documents prior to processing – Case #1 • Failure to double check information that was entered – Case #2 • Failure to review EDBC summary – Case #3 • Failure to adequately document income on the Application Worksheet – where they got income, listing income dates and amounts – Case #4 All causes identified are obviously human error related to lack of attention to detail. In each of the four cases identified, staff reviewed the eligibility determination and corrected as appropriate, including Recovery Accounts established and notices mailed to the household. Corrective action will involve review of training material to determine if there are opportunities to strengthen training material to enhance emphasis on attention to detail for staff receiving the training. Emphasize will also be placed on reviewing material before finalization of case processing to assure accuracy of determination. In addition, the agency is reviewing plans to move from a model that uses several temporary staff that complete only LIEAP eligibility to using full time EES eligibility staff that will do LIEAP in addition to all other EES caseloads. These workers do eligibility for several programs year-round and would not have to be retrained each year. We believe this will improve eligibility determinations and the review and approval process. Name(s) of the contact person(s) responsible for corrective action: Lewis Kimsey, Public Service Executive Shannon Connell, Policy Coordination Assistant Director. Planned completion date for corrective action plan: Training Material finalized by 10/1/24 and that training will be completed by Dec 31, 2024.

CORRECTIVE ACTION PLAN JUNE 30, 2023 REFERENCE: 2023-101 CFDA NUMBER 84.425D – COVID 19 – EDUCATION STABILIZATION FUND U.S. DEPARTMENT OF EDUCATION – 2023 PASSED THROUGH ARIZONA STATE DEPARTMENT OF EDUCATION GRANT NUMBER: S425D210038 CLIENT RESPONSE AND CORRECTIVE ACTION PLAN We concur with the condition. 1. Name of the contact person responsible for corrective action: Michelle Borja, Finance Director 2. Corrective action planned: Time and Effort documentation for employees who work solely on a single cost objective is prepared semi-annually and signed by the employee and/or a supervisor having firsthand knowledge of the work performed by the employee. Time and Effort documentation is collected semi-annually by the Accounting Office. The Finance Director will review forms to ensure the form is completed appropriately. Forms will be reviewed to ensure the period of performance is recorded accurately and signatures obtained from employees and/or supervisors are dated appropriately. 3. Anticipated completion date: Implemented immediately and completed by June 30, 2024

CORRECTIVE ACTION PLAN JUNE 30, 2023 REFERENCE: 2023-101 CFDA NUMBER 84.425D – COVID 19 – EDUCATION STABILIZATION FUND U.S. DEPARTMENT OF EDUCATION – 2023 PASSED THROUGH ARIZONA STATE DEPARTMENT OF EDUCATION GRANT NUMBER: S425D210038 CLIENT RESPONSE AND CORRECTIVE ACTION PLAN We concur with the condition. 1. Name of the contact person responsible for corrective action: Michelle Borja, Finance Director 2. Corrective action planned: Time and Effort documentation for employees who work solely on a single cost objective is prepared semi-annually and signed by the employee and/or a supervisor having firsthand knowledge of the work performed by the employee. Time and Effort documentation is collected semi-annually by the Accounting Office. The Finance Director will review forms to ensure the form is completed appropriately. Forms will be reviewed to ensure the period of performance is recorded accurately and signatures obtained from employees and/or supervisors are dated appropriately. 3. Anticipated completion date: Implemented immediately and completed by June 30, 2024