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Finding 501986 (2024-002)
Significant Deficiency 2024
Program: AL 21.027 - COVID-19- Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Corrective Action Planned: The County will implement procedures to ensure when a contractor is paid with federal funds, sam.gov will be utilized to verify the entity has not been suspended o...
Program: AL 21.027 - COVID-19- Coronavirus State and Local Fiscal Recovery Funds - Suspension and Debarment Corrective Action Planned: The County will implement procedures to ensure when a contractor is paid with federal funds, sam.gov will be utilized to verify the entity has not been suspended or debarred and such procedure will be adequately documented. Anticipated Completion Date: August 16,2024 Responsible Party: Dixon County Board of Supervisors: Don Andersen, Deric Anderson, Roger Peterson, Neil Blolun, Lisa Lunz, Terry Nicholson, and Steve Hassler.
Finding 2024-003 Federal Agency Name: United States Department of Agriculture Program Name: Community Facilities Loans and Grants Federal Assistance Listing #10.766 Finding Summary: During our testing, there was no formal review separate from the preparer over the reserve fund reconciliation for the...
Finding 2024-003 Federal Agency Name: United States Department of Agriculture Program Name: Community Facilities Loans and Grants Federal Assistance Listing #10.766 Finding Summary: During our testing, there was no formal review separate from the preparer over the reserve fund reconciliation for the federal program and there was no formal review of the balance in comparison to the required minimum reserve balance. Responsible Individual: Mandy Robinson, Administrator Corrective Action Plan: We will implement additional control processes to ensure a formal review over the reserve fund reconciliation and a formal review of the balance in comparison to the required minimum reserve balance is completed by staff separate from the preparer. Anticipated Completion Date: 12/31/2024
Management's Response: KC CARE Agrees Views of Responsible Officials and Corrective Action: This appears to be an isolated incident where the vendor was not entered at the correct time in our contract management database. But, in response to this incident, management created a clearer policy and ou...
Management's Response: KC CARE Agrees Views of Responsible Officials and Corrective Action: This appears to be an isolated incident where the vendor was not entered at the correct time in our contract management database. But, in response to this incident, management created a clearer policy and outlined the timing of entering new vendors into the database and then making sure to do initial exclusion check during procurement process. Responsible Official: Dennis Dunmeyer, COO Anticipated Completion Date: Already implemented.
The clerk has on occasion, had issues accessing the system on the last day due to heavy traffic, causing reports to be submitted late. Going forward, reports will be submitted at tleast 10 days prior to the report due date to avoid issues with connectivity.
The clerk has on occasion, had issues accessing the system on the last day due to heavy traffic, causing reports to be submitted late. Going forward, reports will be submitted at tleast 10 days prior to the report due date to avoid issues with connectivity.
Upon OSAl's recommendation, we are putting into place protocols in an official policy and procedures manual specific to all Federal Grants. With their guidance, future Federal Grants will be better documented and monitored in accordance with this policy
Upon OSAl's recommendation, we are putting into place protocols in an official policy and procedures manual specific to all Federal Grants. With their guidance, future Federal Grants will be better documented and monitored in accordance with this policy
US Department of Homeland Security (DHS), Federal Emergency Management Agency 2023-004 Hazard Mitigation Grant Program – Assistance Listing No. 97.039 Recommendation: We recommend the Township should strengthen its documentation retention procedures to ensure evidence of supervisory review and appro...
US Department of Homeland Security (DHS), Federal Emergency Management Agency 2023-004 Hazard Mitigation Grant Program – Assistance Listing No. 97.039 Recommendation: We recommend the Township should strengthen its documentation retention procedures to ensure evidence of supervisory review and approval is clearly documented and maintained with supporting expenditure records. Documentation should demonstrate who performed the review, when the review was completed, and that approval\ was granted prior to payment. Electronic review processes should include a formal approval notation or workflow that can be readily retained and provided for audit purposes. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management understands the importance of reviewing and approving invoices prior to payment. Management believes that the invoices were reviewed and approved as evidenced by the annotations and comments. However management recognizes the importance of clearly noting the approval of the invoice. The Township implemented policies and procedures to ensure that the Township will comply going forward. These policies include review of invoices and clear documentation of approval. Name(s) of the contact person(s) responsible for corrective action: Timothy Tieperman, Township Manager Planned completion date for corrective action plan: June 2026
Finding Number: 2023-004 Condition: The County did not have controls in place during the year under audit to ensure that the required certified payrolls were received by contractors and subcontractors. Planned Corrective Action: Develop a process with Neighborhood Housing and Development Department ...
Finding Number: 2023-004 Condition: The County did not have controls in place during the year under audit to ensure that the required certified payrolls were received by contractors and subcontractors. Planned Corrective Action: Develop a process with Neighborhood Housing and Development Department ensuring all appropriate documentation has been reviewed and received. Contact person responsible for corrective action: Khadija Walker-Fobbs Anticipated Completion Date: 07/15/2024
Finding 2023-004 Inadequate Internal Control over Federal Grant Reporting and Record Retention Federal award: Assistance Listing No. 21.027, Coronavirus State and Local Fiscal Recovery Funds Auditor Description of Condition and Effect During the audit, we noted that the Organization had not establis...
Finding 2023-004 Inadequate Internal Control over Federal Grant Reporting and Record Retention Federal award: Assistance Listing No. 21.027, Coronavirus State and Local Fiscal Recovery Funds Auditor Description of Condition and Effect During the audit, we noted that the Organization had not established and implemented sufficient controls over the preparation, review, submission, and retention of required federal grant reports. Specifically, the Organization could not provide sufficient documentation demonstrating that: • Financial and programmatic information in required reports was reconciled to the underlying accounting and project records; • All applicable reporting elements, including capital expenditures and contractor or subaward information, were evaluated for completeness; • Reports were reviewed and approved by appropriate personnel before certification and submission; • Reports were submitted by the applicable deadlines and evidence of submission was retained; and • Corrections or resubmissions were appropriately documented and supported. The absence of appropriately designed and implemented controls creates a reasonable possibility that materially inaccurate, incomplete, or untimely reports could be submitted, or that material noncompliance with federal reporting and record-retention requirements could occur and not be prevented, or detected and corrected, on a timely basis. Insufficient records may also prevent the Organization from substantiating reported information or demonstrating compliance during an audit, monitoring review, or other oversight. Auditor Recommendation Management should adopt written federal grant reporting procedures and implement a standardized process for preparing, reconciling, reviewing, approving, submitting, and retaining required reports. The process should address all applicable financial and programmatic reporting elements, including capital expenditures and contractor or subaward information, and should require retention of the reports, submission confirmations, supporting records, and documentation of any corrections or resubmissions for the period required by the award. Proposed Corrective Action The Organization agrees with the finding. Management will adopt written federal grant reporting and record-retention procedures, maintain a reporting calendar, and assign responsibility for preparation and review. Reported financial and programmatic information will be reconciled to the underlying accounting and project records, and a standardized checklist will be used to evaluate all applicable reporting elements. Management will document review and approval, retain evidence of timely submission, and maintain the reports, supporting records, and documentation of corrections or resubmissions in a centralized grant file for the retention period required by the award. Responsible Person: Anticipated Completion Date: June 30, 2027
Corrective Action Plan 2023 – 007 FINDING 2023-007 Contact Person Responsible for Corrective Action: Kevin Beaver, Clerk – Treasurer Contact Phone Number and Email Address: Ph. 812-533-1053 Kevin.Beaver@westterrehautein.gov Views of Responsible Officials: We Concur with the SBOA Findings Finding Sub...
Corrective Action Plan 2023 – 007 FINDING 2023-007 Contact Person Responsible for Corrective Action: Kevin Beaver, Clerk – Treasurer Contact Phone Number and Email Address: Ph. 812-533-1053 Kevin.Beaver@westterrehautein.gov Views of Responsible Officials: We Concur with the SBOA Findings Finding Subject: Scope Limitation Corrective Action Plan 1. Establish Formal SEFA Preparation Procedures The Clerk-Treasurer will develop and implement written procedures for the preparation and review of the Schedule of Expenditures of Federal Awards. Procedures will require: • Identification of all federal awards received during the year. • Verification of applicable Assistance Listing Numbers (ALNs). • Documentation supporting all reported expenditures. • Completion of a SEFA preparation checklist before submission. 2. Create and Maintain a Federal Awards Inventory The Town will establish a centralized listing of all federal awards received. The inventory will include: • Federal agency • Program name • Assistance Listing Number (ALN) • Grant period • Award amount • Annual expenditures • Pass-through entity information, when applicable The inventory will be reviewed and updated monthly. 3. Implement Reconciliation Procedures for Federal Expenditures Prior to preparation of the AFR and SEFA, federal expenditures will be reconciled to: • General ledger accounts • Grant reimbursement requests • Supporting grant documentation • Cash drawdowns and receipts Any discrepancies identified during the reconciliation process will be investigated and resolved before submission. 4. Implement Independent Review Controls An independent review of the SEFA will be performed before submission. The review will verify: • Completeness of all federal programs. • Accuracy of reported expenditures. • Correct Assistance Listing Numbers. • Agreement of reported amounts to support records and reconciliations. Evidence of review will be documented through a monthly signed and dated review checklist. 5. Strengthen Grant Documentation and Record Retention The Town will maintain separate grant files for each federal program containing: • Award agreements • Amendments • Reimbursement requests • Financial reports • Supporting expenditure documentation • Correspondence with grantor agencies Records will be maintained in accordance with federal and state retention requirements. 6. Establish Ongoing Monitoring Procedures The Town will perform monthly reviews of federal grant activity to ensure expenditures are properly recorded and reported. Monitoring procedures will include: • Review of grant expenditures by program. • Verification of ALN assignments. • Review of grant balances and reimbursement activity. • Follow-up and correction of identified issues. Results of quarterly reviews will be documented and retained. Quarterly monitoring reports Responsible Party: Clerk – Treasurer and Town Council President. Completion Date: immediate first steps, March 3, 2027, for full implementation. _____________________________ Kevin Beaver, Clerk – Treasurer
Material Weakness Finding No. 2023-005: Allowable Costs/Cost Principles U.S. Department of Housing and Urban Development Passed Through the State of Hawaii Department of Human Services Emergency Solutions Grant Program Coronavirus Federal Assistance Listing Number 14.231 Criteria Pursuant to the Uni...
Material Weakness Finding No. 2023-005: Allowable Costs/Cost Principles U.S. Department of Housing and Urban Development Passed Through the State of Hawaii Department of Human Services Emergency Solutions Grant Program Coronavirus Federal Assistance Listing Number 14.231 Criteria Pursuant to the Uniform Guidance, 2 CFR 200.403, Allowable Costs, costs must be necessary, reasonable, and adequately documented to be allowable under federal awards. Futhermore, 2 CFR, 200.303 states that the non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the entity is managing the award in compliance with federal statutes and regulations. Condition We noted that during 2023, KMNH’s chief executive officer performed accounting functions including recording cash disbursement transactions and reconciliation of the monthly bank statement balances to the cash balances in the general ledger. In addition, there was no evidence of a supervisory review of supporting documentation for expenditures. Cause Due to the limited number of employees, there is not only a lack of consistent supervisory review of supporting documentation of expenditures, but also a lack of segregation of duties to ensure that disbursement transactions are accurately recorded and are compliant with the Uniform Guidance allowable costs/cost principles. Effect Without proper segregation of duties and supervisory review of supporting documentation of expenditures, there is a reasonable possibility that a material misstatement of KMNH’s expenditures of federal awards will not be prevented or detected and corrected on a timely basis. Recommendation We recommend that KMNH engage an accountant to provide relevant services and to implement a supervisory review process of supporting documentation of expenditures and to develop appropriate policies and procedures to ensure proper segregation of duties. Corrective Action Responsible Party: Director of Operations KMNH agrees with the finding and recommendation and will continue its efforts to hire a bookkeeper.
Finding #2023-003: Management has not established a written cost allocation plan or policy as required by Uniform Guidance. Specifically, the Organization lacks documented procedures that define direct and indirect costs, describe how costs will be identified and classified, outline the methodology ...
Finding #2023-003: Management has not established a written cost allocation plan or policy as required by Uniform Guidance. Specifically, the Organization lacks documented procedures that define direct and indirect costs, describe how costs will be identified and classified, outline the methodology used to allocate indirect costs among active federal awards, and address the application of the 10% de minimis indirect cost rate. As a result, there is no formal framework to support the consistent allocation of costs to federal programs or to demonstrate compliance with federal requirements. Response: Management acknowledges and accepts the finding and recommendation. Management will work to ensure a proper written cost allocation policy as required by the Uniform Guidance is established by December 31, 2026.
Allowable Costs – Noncompliance and Significant Deficiency in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing enhanced grant compliance review procedures to ensure expenditures are allowable, adequately supported, and incurred within the applicable pe...
Allowable Costs – Noncompliance and Significant Deficiency in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing enhanced grant compliance review procedures to ensure expenditures are allowable, adequately supported, and incurred within the applicable period of performance. Standardized documentation, supervisory review, and monitoring procedures will be incorporated into routine grant administration. Management will evaluate the effectiveness of these controls through completion of a full audit cycle. Anticipated Completion Date June 30, 2027
Reporting - Deadline for Federal Single Audit - Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun strengthening year-end financial reporting and audit planning through formal close schedules, defined responsibilities, milestone...
Reporting - Deadline for Federal Single Audit - Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun strengthening year-end financial reporting and audit planning through formal close schedules, defined responsibilities, milestone tracking, enhanced interdepartmental coordination, and increased management oversight to support the timely completion of future Federal Single Audits. Management will evaluate the effectiveness of these improvements through completion of a full audit cycle. Anticipated Completion Date June 30, 2027
Subrecipient Monitoring – Material Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing standardized subrecipient monitoring procedures, including documented risk assessments, monitoring protocols, supervisory review,...
Subrecipient Monitoring – Material Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing standardized subrecipient monitoring procedures, including documented risk assessments, monitoring protocols, supervisory review, and enhanced oversight to strengthen compliance with Uniform Guidance requirements. Management will evaluate the effectiveness of these controls through completion of a full audit cycle. Anticipated Completion Date June 30, 2027
Reporting – Material Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing an enterprise-wide corrective action strategy to strengthen grant administration and reporting processes. Corrective actions include developing...
Reporting – Material Noncompliance and Material Weakness in Internal Control Over Compliance Corrective Action Plan: The Municipality has begun implementing an enterprise-wide corrective action strategy to strengthen grant administration and reporting processes. Corrective actions include developing standardized policies and procedures, formalizing documentation and supervisory review requirements, improving subrecipient monitoring, strengthening cross-departmental coordination, and incorporating these processes into formal year-end close and audit planning activities. Management will evaluate the effectiveness of these controls through completion of a full audit cycle. Anticipated Completion Date March 31, 2027
Action Taken in Response to Finding: Financial practices addressing program income were in place; however, processes were formalized to ensure full compliance with 2 CFR §200.307. ActivateWork developed and implemented a Program Income Policy as part of its Financial Policies and Procedures, adopted...
Action Taken in Response to Finding: Financial practices addressing program income were in place; however, processes were formalized to ensure full compliance with 2 CFR §200.307. ActivateWork developed and implemented a Program Income Policy as part of its Financial Policies and Procedures, adopted May 2026. As of March 2026, a standardized program income tracking and reconciliation is performed monthly as part of the month-end (EOM) close. This process includes: • Identification and tracking of program income by funding source • Application of program income to actual allowable expenses • Mapping of Federal reimbursement requests to underlying expenses to ensure program income is applied prior to reimbursement • Validation that no duplication of funding occurs between program income and Federal reimbursements These enhancements establish a structured and auditable framework for program income tracking, application, and compliance. Control Enhancement: Program income is tracked and recorded within a standardized Excel-based tool (Program Income vs. Unreimbursed Cost Analysis) and applied in accordance with federal requirements. A standardized program income tracker: • Applies program income to actual expenses • Links expenses to reimbursement requests • Ensures program income is fully utilized prior to requesting Federal reimbursement, unless otherwise specified by award terms • Prevents duplication of income and reimbursement Monitoring & Review: • Program income tracking is reviewed monthly as part of the EOM close process • Review is performed by the Senior Accountant • A secondary review is performed by the Director of Finance & Operations to validate completeness and compliance • Any discrepancies are identified and resolved prior to reimbursement submission Testing & Validation: • Beginning in June 2026, quarterly internal reviews will be conducted to validate program income tracking and application • Testing will confirm that: o Program income is accurately recorded o Program income is applied prior to reimbursement o No duplication of funding exists • Results will be documented and tracked for remediation Documentation & Evidence: • Program income tracker maintained in Teams / SharePoint • Supporting documentation tied to underlying expenses Control Owner(s): • Director of Finance & Operations • Finance Team Responsible Party: Helen Young Hayes, Founder / Chief Executive Officer, in coordination with the Director of Finance & Operations and Finance Staff Anticipated Completion Date: All corrective actions will be implemented by June 30, 2026. Ongoing monthly monitoring, reconciliation, and quarterly validation will continue. Status: • Program Income Policy: Implemented May 2026 • Program income tracking process: Implemented April 2026 • Monthly reconciliation and application (EOM Close): Implemented May 2026 • Quarterly internal reviews will be conducted to validate program income tracking and application: June 2026.
Management agrees with the finding and will implement procedures to ensure reimbursement request documentation and supporting schedules are retained in a centralized location and readily accessible for future monitoring and audit purposes. Anticipated Completion Date: September 30, 2026.
Management agrees with the finding and will implement procedures to ensure reimbursement request documentation and supporting schedules are retained in a centralized location and readily accessible for future monitoring and audit purposes. Anticipated Completion Date: September 30, 2026.
Finding 2023-007: Lack of Internal Control And Noncompliance With Activities Allowed or Unallowed; Allowable Costs/Cost Principles Name of Contact: Josh Verhagen, Patricia Jirsa Corrective Action Plan: Similar answer as it was to 2023-002. A new and rigorous system has been implemented that ensures ...
Finding 2023-007: Lack of Internal Control And Noncompliance With Activities Allowed or Unallowed; Allowable Costs/Cost Principles Name of Contact: Josh Verhagen, Patricia Jirsa Corrective Action Plan: Similar answer as it was to 2023-002. A new and rigorous system has been implemented that ensures all expenses are being reviewed, approved and entered with proper expensing and filing. Proposed Completion Date: December 2026.
Item 2023.006 – Cash Management Recommendation The Center should develop written procedures to review all drawdowns that occur in order to ensure accuracy. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this recommendation: • Prepare written procedures ...
Item 2023.006 – Cash Management Recommendation The Center should develop written procedures to review all drawdowns that occur in order to ensure accuracy. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this recommendation: • Prepare written procedures to document the process for Drawdown requests, including the initial review, documented approval process, submission to the funding agency, and the recording of the drawdown in the accounting system immediately after submission • Maintain detailed records of all drawdown requests, supporting documentation, approvals, and correspondence • Conduct regular internal reviews of drawdown activities to ensure compliance with procedures and maintain audit trail • Review drawdown procedures annually to ensure they remain current with funding agency guidelines and best practices
Finding No.: 2023-020 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Special Tests and Provisions - Key Level Management Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Manage...
Finding No.: 2023-020 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Special Tests and Provisions - Key Level Management Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management processes were promulgated in a SOP on September 18, 2024. The SOPs are under review by an external consultant and recommendations made to improve documentation of time and effort allocable under federal awards. (See also 2023-004, 2023-0009) Corrective Action Plan: I. Establishment of Time and Effort SOPs: PSS will finalize and implement a dedicated Time and Effort Reporting SOP. This policy will explicitly define the key management Level of Effort (LOE) requirements by position and mandate the collection of specific supporting records, including Notice of Personnel Action (NOPA) forms, payroll registers, and certified timesheets. The SOP will feature robust internal controls and supervisory review procedures designed to prevent improper payments and ensure accurate labor distribution. II. Standardization of Key Management Records: PSS will obtain and systematically retain NOPA forms or equivalent documentation for all six positions identified in the grant agreement. This documentation will serve as the primary evidence to demonstrate compliance. III. Labor Distribution Monitoring Controls: PSS is implementing ongoing monitoring controls to ensure continued compliance. This includes a periodic internal review of payroll registers against the original grant agreements to verify that the labor costs charged to the award remain consistent with the approved personnel budget and documented effort. Proposed Completion Date: August 2026 Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org
Finding No.: 2023-018 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the finding....
Finding No.: 2023-018 AL Program: 93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance Area: Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the finding. While internal verification of disbursements is a standard part of our fiscal workflow, we recognize that our current process has the space to improve. Corrective Action Plan: To ensure that all disbursements are verified and documented prior to payment, PSS will implement the following: I. High Level Review and Approval: Implementation of Comptroller/ Director of Finance review on the Batch Invoice Summary signifying invoice entries on the said batch are verified and correct. After the review, the Comptroller will sign. II. Updated Payment Verification Process: Payments via check or ACH are reviewed by the Comptroller/ Director of Finance through Payment Manager and marking the Batch Invoice Summary that payments matched the invoice. Proposed Completion Date: December 2025 Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org
Finding No.: 2023-017 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Private School Participation Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management disagrees with the finding. PS...
Finding No.: 2023-017 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Private School Participation Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management disagrees with the finding. PSS asserts that timely and meaningful consultations were conducted with private school officials prior to making decisions regarding the size, scope, and funding of equitable services for FY2023. Calculations for the equitable share under the Education Stabilization Funds were performed in accordance with federal regulations, ensuring that per-pupil allocations for eligible private school students and teachers were equitable relative to public school expenditures. PSS maintains that consultation timelines, meeting records, and allocation formulas were maintained. While PSS is continuously refining its administrative workflows, the existing documentation and controls were sufficient to satisfy the requirements of 34 CFR § 299.7. Proposed Completion Date: Resolution in progress and on track for completion by August 2026. Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org
Finding No.: 2023-016 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Wage Rate Requirement Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the audit findings. We a...
Finding No.: 2023-016 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Special Tests and Provisions - Wage Rate Requirement Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the audit findings. We acknowledge that our current procurement and contract administration processes did not consistently incorporate the mandatory Davis-Bacon Act labor standard clauses or the subsequent collection of certified payrolls. PSS is committed to implementing a rigorous compliance framework for all federally funded construction and repair projects. Financial, Procurement, and Grants Management policies procedures were promulgated in a SOPs on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve documentation of cost allowability have been received. Payment procedures are being addressed in a separate SOP. Corrective Action Plan: To ensure full compliance with 29 CFR 5.5 and federal wage rate requirements, PSS will implement the following: I. Standardized Construction Contract Template: PSS Legal Counsel and the Procurement Office will develop a standardized "Federal Construction Contract Addendum." This addendum will contain all mandatory Davis-Bacon Act clauses required by 29 CFR 5.5(a)(1)-(10). Effective immediately, no contract or purchase order exceeding $2,000 for construction, alteration, or repair will be executed without the inclusion of this addendum. II. Mandatory Certified Payroll Submission Protocol: PSS will update its "Notice to Proceed" and project management guidelines to explicitly state that progress payments will be withheld until the contractor submits the required weekly certified payrolls. Contractors will be provided with the Form WH-347 (or an equivalent) to ensure they are using the correct reporting format. III. Pre-Construction Compliance Meetings: For all future Davis-Bacon covered projects, PSS will hold a mandatory pre-construction meeting with contractors to clearly communicate their obligations regarding certified payrolls and the posting of the applicable wage decision at the job site. IV. Document Retention and Review Audit: PSS will implement a "Project Close-out Checklist." Finance will not process the final retention payment for any construction project until the Labor Compliance Monitor certifies that all weekly certified payrolls have been received, reviewed, and filed. V. Updated Standard Operating Procedures and Training: PSS will finalize SOPs and policies internal controls with updated internal controls and procedures for required contract clauses and oversight. Checklists will be updated to include a specific control for Davis-Bacon reporting. Require all current contractors and those identified in this audit to submit certified payrolls for 2023 through the span of their contracts for all Davis-Bacon covered work. PSS Procurement and Supply staff will receive refresher training on cost principles annually regarding required contract clauses and documentation to support compliance with requirements. Proposed Completion Date: September 2026 Name of Contact Person and Title: Contact: Michael Jason A. Babauta, Chief Procurement & Supply Officer Email Address: michael.jason.babauta@cnmipss.org
Finding No.: 2023-015 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Matching, Level of Effort, Earmarking Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management does not agree with the finding. PSS has allocated a...
Finding No.: 2023-015 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Matching, Level of Effort, Earmarking Questioned Costs: Undeterminable Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management does not agree with the finding. PSS has allocated and expended more than 20% on evidence-based interventions to address learning loss. Specifically, projects listed under the ARP expense report are mapped directly to learning loss categories (e.g. expenses for summer school, extended learning opportunities, high dosage tutors, etc.). Based on this documentation, we request that the audit finding be revised to reflect compliance. Proposed Completion Date: Resolution in progress and on track for completion by August 2026. Name of Contact Person and Title: Contact: Jacqueline Che, Federal Programs Officer Email Address: jacqueline.che@cnmipss.org
Finding No.: 2023-013 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Activities Allowed/Unallowed, Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial a...
Finding No.: 2023-013 AL Program: COVID-19 84.425A/84.425X Education Stabilization Fund Area: Activities Allowed/Unallowed, Allowable Costs/Cost Principles Questioned Costs: $-0- Views of Auditee and Corrective Action Plan: Management’s Position: PSS Management concurs with the findings. Financial and Grants Management policies procedures were promulgated in SOPs on September 18, 2024. The financial management system was subsequently changed to Tyler Munis to conform with CNMI central government requirements which will enhance capabilities. The SOPs and the Tyler Munis implementation are under review by an external consultant and recommendations made to improve documentation of cost allowability have been received. Corrective Action Plan: I. Finalization of Allowability and Disbursement SOPs: PSS will finalize comprehensive Standard Operating Procedures (SOPs) and policies specifically governing allowability determinations and vendor payments. II. Enhanced Disbursement Controls: PSS is implementing a documented review and approval controls over the payment process. Before any check or ACH disbursement is finalized, a reviewer must verify that the payment amount agrees exactly with the approved invoice. This verification will be physically or digitally documented on the payment voucher to provide a clear audit trail of the pre-payment review. Proposed Completion Date: In progress for FY 2024 with full implementation and documentation processes expected to be completed in 2026. As part of this improvement, we are designing a standardized, documented review process to ensure all disbursements are verified against approved invoices prior to payment. Name of Contact Person and Title: Contact: Jonathan Aguon, Director of Finance Email Address: jonathan.aguon@cnmipss.org
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