Corrective Action Plans

Recommendation: We recommend that the University post and maintain the Student Aid Quarterly reports on the University?s website, as required. In addition, in order to prevent similar instances in the future, we recommend the University ensure interpretation of guidance is accurate through use of trainings, consultations and direct correspondence with the regulatory agency, when necessary, to ensure full understanding of reporting requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The university agrees. OSU reported the HEERF student aid portion quarterly on our reporting webpage. We initially interpreted the guidance to mean that at each quarter we should update the report the total student portion on the webpage to be cumulative and the previous quarter report was removed from the website. OUS will go back and report each quarter separately instead of as one aggregate total. We will post this data on the current reporting page by February 10, 2023. Name of the contact person responsible for corrective action: Keith Raab, Director of Financial Aid Planned completion date for corrective action plan: February 10, 2023

The University of New Hampshire respectfully submits the following corrective action plan for the year ended June 30, 2022. Audit period: July 01, 2021 to June 30, 2022 The finding from the schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. FINDINGS?FINANCIAL STATEMENT AUDIT There were no financial statement findings in the current year. FINDINGS?FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Education 2022-001 Education Stabilization Fund ? Assistance Listing Numbers 84.425E and 84.425F Recommendation: We recommend the Universities and Colleges maintain the documentation used during the reporting process to support the numbers included in the public reporting on their website as well as maintain the formal documentation of the review and approval process that the reports go through during preparation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The University of New Hampshire (UNH) will work to resolve the reporting finding for fiscal year 2022 reporting. UNH will develop a process to ensure that the information reported is accurate and supporting documentation used to prepare the reports and review and approval of the reports is retained. Name(s) of the contact person(s) responsible for corrective action: Liz Stevens, Director of Student Financial Services (Student Reporting) Susan Zipkin, Director Accounting and Financial Compliance (Institutional Reporting) Planned completion date for corrective action plan: March 31, 2023 If the U.S. Department of Education has questions regarding this plan, please contact the individuals noted above. Plymouth State University respectfully submits the following corrective action plan for the year ended June 30, 2022. Audit period: July 01, 2021 to June 30, 2022 The finding from the schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. FINDINGS?FINANCIAL STATEMENT AUDIT There were no financial statement findings in the current year. FINDINGS?FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Education 2022-001 Education Stabilization Fund ? Assistance Listing Numbers 84.425E and 84.425F Recommendation: We recommend the Universities and Colleges maintain the documentation used during the reporting process to support the numbers included in the public reporting on their website as well as maintain the formal documentation of the review and approval process that the reports go through during preparation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Plymouth State University (PSU) will work to resolve the reporting finding for fiscal year 2022 reporting. PSU will develop a process to ensure that future information is reported timely, and the review and approval of the reports is documented and retained. The FY21 Uniform Guidance Single Audit was not finalized until June 2022, which contributed to the recurring issues noted in this finding. Name(s) of the contact person(s) responsible for corrective action: Mary Batch, Director of Finance (Institutional Reporting) Mac Broderick, Director of Student Financial Services (Student Reporting) Planned completion date for corrective action plan: July 31, 2022 If the U.S. Department of Education has questions regarding this plan, please contact the individuals noted above. Keene State College respectfully submits the following corrective action plan for the year ended June 30, 2022. Audit period: July 01, 2021 to June 30, 2022 The finding from the schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. FINDINGS?FINANCIAL STATEMENT AUDIT There were no financial statement findings in the current year. FINDINGS?FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Education 2022-001 Education Stabilization Fund ? Assistance Listing Numbers 84.425E and 84.425F Recommendation: We recommend the Universities and Colleges maintain the documentation used during the reporting process to support the numbers included in the public reporting on their website as well as maintain the formal documentation of the review and approval process that the reports go through during preparation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Keene State College (KSC) will work to resolve the reporting finding for fiscal year 2022 reporting. KSC developed a process to ensure that the information is reporting timely, accurately, and supporting documentation used to prepare the reports and review and approval of the reports is retained. The FY21 Uniform Guidance Single Audit was not finalized until June 2022, which contributed to the recurring issues noted in this finding. Name(s) of the contact person(s) responsible for corrective action: Catherine Mullins Planned completion date for corrective action plan: July 1, 2022 If the U.S. Department of Education has questions regarding this plan, please contact the individuals noted above. Granite State College respectfully submits the following corrective action plan for the year ended June 30, 2022. Audit period: July 01, 2021 to June 30, 2022 The finding from the schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. FINDINGS?FINANCIAL STATEMENT AUDIT There were no financial statement findings in the current year. FINDINGS?FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Education 2022-001 Education Stabilization Fund ? Assistance Listing Numbers 84.425E and 84.425F Recommendation: We recommend the Universities and Colleges maintain the documentation used during the reporting process to support the numbers included in the public reporting on their website as well as maintain the formal documentation of the review and approval process that the reports go through during preparation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Granite State College (GSC) will work to resolve the reporting finding for fiscal year 2022 reporting. GSC and the University of New Hampshire (UNH) are in the process of merging as part of a new college within UNH, which resulted in a transition of reporting responsibilities and processes. GSC and UNH will develop a process to ensure that the information reported is accurate and supporting documentation for the review and approval of reports is retained. The FY21 Uniform Guidance Single Audit was not finalized until June 2022, which contributed to the recurring issues noted in this finding. Name(s) of the contact person(s) responsible for corrective action: Andrea Nepveu, Acting Director of Financial Aid (Student Reporting) Susan Zipkin, Director, Accounting and Financial Compliance (Institutional Reporting) Planned completion date for corrective action plan: March 31, 2023 If the U.S. Department of Education has questions regarding this plan, please contact the individuals noted above.

2022-005 Higher Education Emergency Relief Funds (HEERF) Reporting Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance; Other Matters Recommendation: We recommend the College establish controls to ensure accurate and timely reporting. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Tabor College will ensure proper documentation of reviews for reporting and that report submission guidelines are followed. Name(s) of the contact person(s) responsible for corrective action: Cathy Castle, Vice President for Business and Finance Planned completion date for corrective action plan: Immediately as additional federal awards are received.

FINDINGS ? FEDERAL AWARD PROGRAMS AUDIT U.S. Department of Education Passed Through Kansas State Department of Education Program Name: Child Nutrition Cluster Federal Assistance Listing Numbers: 10.553; 10.582; 10.559 Finding 2022-001 ? Internal Controls Recommendations: The District should have an employee compare the District Treasurer?s supporting documentation and the Child Nutrition report before its submission to the State of Kansas for its accuracy. After the approval by the secondary review employee, the report submitted should be printed, initialed by the secondary reviewer, stapled with the information used to compile the report and combined with all financial records for the fiscal year. Action Taken: We agree with the recommendation. Our targeted implementation date is March 2022.

FINDING 2022-004 Contact Person Responsible for Corrective Action: Shawn Spindler, Business Manager/Treasurer Contact Phone Number: 812.926.2090 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: We will ensure that any future private school expenses are incurred and paid by the district instead of reimbursing the private schools their expenses. This will be reviewed by the Director of Curriculum to ensure compliance. Anticipated Completion Date: March 2023

FINDING 2022-003 Contact Person Responsible for Corrective Action: Shawn Spindler, Business Manager/Treasurer Contact Phone Number: 812.926.2090 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: We will ensure that any future capital equipment gets included on our inventory list. This will be reviewed by the Superintendent to be sure all equipment is added. Anticipated Completion Date: March 2023

FINDING 2022-002 Contact Person Responsible for Corrective Action: Shawn Spindler, Business Manager/Treasurer Contact Phone Number: 812.926.2090 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: The appropriate personnel will prepare some sort of time and effort documentation which will then be approved by the Board of Trustees to have split personnel costs. Anticipated Completion Date: June 2023

Views of Responsible Officials and Planned Corrective Action ? The Purchasing Director will update policies and procedures to specifically address procurement for federal awards. The University will also ensure that Purchasing Department and Business Office staff participate in annual federal compliance training. Timeline and Estimated Completion Date: December 2022 Responsible Party: Aaron Flure, Purchasing Director and Stephanie Gonzales, Comptroller

FINDING 2022-001 Contact Person Responsible for Corrective Action: Dr. Michael Galvin, Superintendent Contact Phone Number: 812-874-2243 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: The Metropolitan School District of North Posey County has been seeking companies to complete asset management. We had a Google Meet with AdTec Incorporated on February 7, 2023 to understand the process and receive a bid for completing the project. We plan to take this proposal during the March 13, 2023 School Board meeting. Ad Tec would be able to begin the asset mapping during the summer of 2023 for completion in August 2023. Anticipated Completion Date: According to AdTec, they will visit the District schools during the summer of 2023 to complete the asset log, and then provide a report in August 2023.

FINDING 2022-002 Contact Person Responsible for Corrective Action: Dr. Michael Galvin, Superintendent Contact Phone Number: 812-874-2243 Views of Responsible Official: We concur with the finding for the period of the audit, we have since corrected the actions by the end of the 2021/2022 school year. Description of Corrective Action Plan: Aramark supplies all invoices, TDR and copies of receipts to be verified with the monthly invoice. The Food Service Director then goes through the invoices, receipts, and TDR sheets to verify all charges to the SFA are accounted for and correct. The Food Service Director initials the invoices and receipts to show they have been verified against the TDR and bill for Aramark. When the Food Service Director has completed the verification, they fill out a purchase order to have the ECA pay Aramark. Anticipated Completion Date: The corrective action plan was implemented in April of 2022.

FA 2022-001 Improve/Strengthen Controls over Expenditures Compliance Requirement: Activities Allowed or Unallowed Allowable Costs/Cost Principle Procurement and Suspension and Debarment Internal Control Impact: Significant Deficiency Federal Awarding Agency: U.S. Department of Education Pass-Through Entity: Georgia Department of Education Assistance Listing Number and Title: COVID-19 - 84.425D - Elementary and Secondary School Emergency Relief Fund COVID-19 - 84.425U - American Rescue Plan Elementary and Secondary School Emergency Relief Fund COVID-19 - 84.425W - American Rescue Plan Elementary and Secondary School Emergency Relief Fund - Homless Children and Youth Federal Award Number: S425D200012 (Year: 2020), S425U2120012 (Year: 2021) S425W210011 (Year: 2021) Questioner Costs: $30,180 Prior Year Finding: None Description: The polices and procedures of the School District were insufficient to provide and adequate internal controls over expenditures as it relates to the Elementary and Secondary School Emergency Relief Fund program. Corrective Action Plans: Revise Federal Programs Handbook to enhance internal controls in the area of contracts. Provide addendums to contracted services to provide for retention bonuses to contracted staff. Estimated Completion Date: June 30, 2023 Contact Person: Seth Taylor, Chief Financial Officer Telephone: 229-723-4337 Email: staylor@early.k12.ga.us

2022-001 ? Review and Approval of the Schedule of Expenditures of Federal Awards (SEFA) ? We feel that much was learned in the audit process by Organization staff and Palm Beach Accounting and Financial Services. We will make the Schedule of Expenditures of Federal Awards a priority in the next audit, and if need will retain an expert consultant to assist in the preparation prior to providing to the audit firm.

2022-003: Loan disbursement notifications {14 day right-to-cancel letters). Management Views and Opinion The University of Miami acknowledges that some students did not receive their notifications informing them of the 14 day right-to-cancel for their Federal Direct Loans within the proscribed timeframe of 7 days from the date of disbursement. The root cause was a defect in the server set-up for our financial aid automated processing; the administrative software appeared to generate letters and provided no error message, however, notifications were not sent. Once identified by UM on October 21, 2021, UM sent notifications to any students not originally notified, however, this notification occurred outside the required window of time (7 days). Corrective Action The University has worked with the software provider to diagnose the issue as a missing instance of Microsoft Word on the server which processed the 14-day letters. We have addressed this issue and repaired the automated functionality as of September 21, 2022. During the down time, the university prepared these letters using a daily manual process to ensure that they were sent in a timely fashion. Timeline for Action Plan The issue was initially identified, and a temporary corrective action was put in place in October 2021 with a final correction in October 2022. Responsibre Individuals Daniel T. Barkowitz Roosevelt Deleveaux Beth Hernandez

2022-002: FOL and Pell Reporting Management Views and Opinion The University of Miami acknowledges that the disbursements as reflected on the individual student account were different by one day from the date reported to COD (Common Origination and Disbursement system). This error occurred due to the timing of scheduled jobs to run financial aid disbursement. The file process to disburse jobs ran late at night prior to midnight, but the job to post the disbursed aid ran after midnight and therefore showed a day later than reflected on the financial aid system. Corrective Action Plan In mid-August 2022, the University changed the evening job schedule to ensure that Federal financial aid will be both disbursed from the-financial aid system and posted to the Student Account on the same calendar day. This evening schedule job change will resolve this situation moving forward. Timeline for Action Plan The underlying issue was already corrected in August 2022. Responsible Individuals Daniel T. Barkowitz Roosevelt Deleveaux Norma De La 0

2022-001 Enrollment Reporting Management Views and Opinion Graduation Status Change UM management agrees that I out of 40 students had graduated but whose graduation status change was not reported at the campus or program level. While this student's graduation status change was not reported at the campus or program level, the student's record was reported as withdrawn within the allotted 60 days and therefore NSLDS was aware student was no longer enrolled. Enrollment Status Change UM management agrees that 14 out of 40 students' program level withdrawal date did not match their campus level withdrawal date. While all the students' withdrawal statuses were reported within the NSDLS guidelines and the final day of the Fall 2021 semester was used for their campus level withdrawal date, the first day of the Spring 2022 semester was incorrectly used for the program level withdrawal date. Corrective Action Plan Graduation Status Change Management will expand on the current controls in place by adding a review process for those student accounts that require manual status changes. Enrollment Status Change Management will expand on the current controls in place by adding a review process for those student accounts that require manual status updates based on the National Student Clearinghouse (NSC) Error Resolution Report. Timeline for Action Plan Graduation Status Change The review process for graduation status changes was implemented effective December 9, 2022. Enrollment Status Change The review process for enrollment status changes was implemented effective December 9, 2022. Responsible Individuals Allen Augustin, Associate Registrar

2022-005 Reporting Management Views and Opinion UM management agrees that the PRF Period 1 reporting submission was subsequently revised to remove $14,854,235 of Other Provider Relief Fund Expenses. The Other Provider Relief Fund Expenses removed from the Period 1 submission were allowable. However, given the dynamic reporting guidance and best practices circulated subsequent to the Period 1 reporting submission, it was determined by management to utilize lost revenues to support the PRF funding rather than expenses incurred. Corrective Action Plan UM management believes this to be an isolated incident due to the novel COVID-19 virus. While management will work to avoid the need for revised reporting submissions, management will continue to ensure the reports align with the latest guidance and best practices. Timeline for Action Plan UM management identified the need for a revised report and has already completed the revised submission. Responsible Individuals Charity Fannin, Chief Accounting Officer Craig McAllister, Assistant VP Risk Management

2022-004 Reporting Management Views and Corrective Action Plan Quarterly Report Posting There was minimal reporting guidance available during the initial HEERF I disbursement period. Although there are no more funds to report, UM management will ensure to follow the guidelines of reporting, and all required content is timely posted on the UM website. Quarterly Report Submission While the submission to the Department of the Education was on time, the posting on the website was slightly delayed for calendar quarters ended June 30, 2021, and September 30, 2021. Although funds have been fully disbursed, UM management will complete future required reports with ample time to allow the website team to post the required content prior to the deadline. Additionally, UM management will confirm posting took place by the deadline for tracking and assurance purposes. Quarterly Report Data Based on input from financial aid, the differences are immaterial and could be due to appeals granted after publication. The quarter report ended June 30, 2021, posted on the UM website, has a percentage error of 2.9% in the total amount distributed to students. The quarter report that ended December 31, 2021, posted on the UM website, has a percentage error of 0.2% in the total amount distributed and 0.9% in the total number of eligible students. Although funds have been fully disbursed, UM management will ensure compliance with reporting guidelines, and we will update the website if appeals have been granted after the reporting deadline. Timeline for Action Plan The corrective action plan will begin immediately with the first quarter of the calendar year 2023. Responsible Individuals Aintzane Celaya, Associate Vice President Financial Planning & Analysis and Chief Budget Officer

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

2022-065 Oregon Department of Education State did not meet maintenance of effort requirement Federal Awarding Agency: U.S. Department of Education Assistance Listing Number and Name: 84.425C, 84.425D, 84.425R, 84.425U & 84.425W Education Stabilization Fund (COVID-19) Federal Award Numbers and Years: S425C210048; 2021 (COVID-19), S425D210049; 2021 (COVID-19), S425R210047; 2021 (COVID-19), S425U210049; 2021 (COVID-19), S425W210038; 2021 (COVID-19) Compliance Requirement: Matching, Level of Effort, Earmarking Type of Finding: Material Weakness; Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: Section 18008 of Coronavirus Response and Relief Supplemental Appropriations (CRRSA) Act; Section 2004(a) of the American Rescue Plan (ARP) Act; 2 CFR 200.303 The CRRSA and the ARP acts require the State to maintain support for both elementary and secondary education and for higher education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education and for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018 and 2019. The Department of Education did not meet the maintenance of effort provisions for fiscal year 2022 for elementary and secondary education. Although the state?s overall funding increased for education its proportional level relative to Oregon?s overall spending declined. The department is reliant on the legislative budget process. The department was in contact with the federal awarding agency about the maintenance of effort issue. The department submitted a waiver request to the U.S. Department of Education dated March 29, 2023. According to department management, budget changes and obtaining a clearer understanding of the other fund amount delayed the calculation for maintenance of effort. If the waiver is not approved, the department may be asked to return some of the funds. The total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022 were $426 million. We recommend department management continue to actively track whether it will meet the maintenance of effort requirement and work with the federal awarding agency. MANAGEMENT RESPONSE: We agree with this recommendation. The Department of Education agrees with this finding; however, context is critical to understand this requirement. The Maintenance of Effort (MOE) requirements in The ARP ESSER III legislation are unique. The purpose of the requirement is to ensure that states are not moving the federal pandemic funds in to replace state funding and then leaving districts with a more substantial ?fiscal cliff? when the pandemic funds recede. ODE administers state funding to Oregon districts, but the levels and formulas governing the distribution of the funds are determined by the Oregon Legislature and not ODE. State School and the Student Success Act?s Student Investment Account funding and other funding corrections are via complex statutory formulas intended to ensure equity of funding across the state. ODE has worked very closely with our USED partners regarding the delay in our access to data and while preparing the Maintenance of Effort waiver request to USED. While ODE acknowledges the state did not meet MOE, ODE has made every good faith effort within in its power and authorities to communicate the reasons for lack of compliance to USED and timely applied for a waiver. ODE, along with other SEAs, now has a deeper understanding of the funding and methodology requirements of MOE under ARP ESSER and will be able to assess compliance for 2023 much more quickly, but only after the final 2023 data is completed. Since that data completion will not be until January 2024, ODE will likely still be contemplating whether or not to pursue an MOE waiver with USED early in 2024. ODE is committed to continue to work closely with our USED partners to achieve compliance or appropriately request a waiver. Anticipated Completion Date: June 30, 2024 Contact: Cynthia Stinson, Senior Manager of Federal Investments & Pandemic, Renewal Effort, OTLA

2022-030 Oregon Housing and Community Services Ensure controls over administrative expenditure limits are properly designed and sufficiently detailed to ensure compliance Federal Awarding Agency: U.S. Department of the Treasury Assistance Listing Number and Name: 21.023 Emergency Rental Assistance Program (COVID-19) Federal Award Numbers and Years: ERA 1, 2021; ERA 2, 2021 (COVID-19) Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Material Weakness Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.303(a), (c)-(d); 15 U.S.C. 9058a(c)(5)(A); 15 U.S.C. 9058c(d)(1)(C) Department management is responsible for establishing and maintaining effective internal control that provides reasonable assurance the department is managing, evaluating, and monitoring the federal award in compliance with the terms and conditions of the award and taking prompt action when instances of noncompliance are identified. Federal regulations limit the amount of federal funds that can be used for administrative expenditures. The department periodically prepared tracking spreadsheets during the fiscal year to monitor spending and ensure administrative expenditure limitations were not exceeded. We reviewed four randomly selected tracking spreadsheets and noted two tracking spreadsheets where there was insufficient detail to determine what category expenditures were associated with (administrative versus programmatic); and three tracking spreadsheets where there was no indication that the expenditures were within administrative expenditures limitations due to the periodic nature of the tracking. Without sufficiently designed and implemented controls, the department is at risk for exceeding their allowable administrative cost limits. We recommend department management ensure tracking spreadsheets are properly designed and sufficiently detailed to ensure compliance with administrative expenditures limitations. MANAGEMENT RESPONSE: We agree with this recommendation. This was a very fast-paced, complex award with multiple layers of funding. OHCS did have and continues to have a pulse on administrative costs from the various admin funding sources and has not exceeded those allowable limits. Reporting was routinely compiled to show the various allocations and expenditures to date, which included administrative costs. Reporting was not provided in a consistent manner as information from multiple systems was needed, however program and fiscal staff met regularly to review. OHCS is taking careful steps to design a system that will consistently track awards while ensuring spending is in alignment with requirements and is distributed in a timely fashion. In doing so we will create a more consistent framework for tracking new awards to ensure limits and expenditures are consistently documented. Anticipated Completion Date: December 31, 2023 Contact: Jill Smith, Director of Housing Stabilization Division or Beth Brown, Accounting Manager

2022-028 Oregon Housing and Community Services Ensure Federal Funding Accountability and Transparency Act reporting is completed Federal Awarding Agency: U.S. Department of the Treasury Assistance Listing Number and Name: 21.023 Emergency Rental Assistance Program (COVID-19) Federal Award Numbers and Years: ERA 1, 2021 (COVID-19); ERA 2, 2021 (COVID-19) Compliance Requirement: Reporting Type of Finding: Material Weakness, Material Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.303(a), (c)-(d); 2 CFR 170, Appendix A I(a) Department management is responsible for establishing and maintaining effective internal control that provides reasonable assurance the department is managing, evaluating, and monitoring the federal award in compliance with the terms and conditions of the award and taking prompt action when instances of noncompliance are identified. The Federal Funding Accountability and Transparency Act (FFATA) requires the department to submit information for any subaward action that equals or exceeds $30,000. Program guidance required the department to report detailed subaward information directly to the federal awarding agency. This detailed subaward information encompassed all requirements related to FFATA, and the federal awarding agency gave the department the option of filing required FFATA reports on their behalf. The department stated they did not provide the detailed subaward information to the federal awarding agency to complete FFATA reporting on their behalf, and they did not complete any alternate FFATA submissions during the fiscal year due to grant award information not being available on the federal website to file their reports. As a result, the department is not in compliance with FFATA reporting requirements. We recommend department management ensure FFATA reporting is completed. MANAGEMENT RESPONSE: We agree with this recommendation. Oregon was not unique. Many states experienced frustration with the lack of clarity in the reporting process. For example, the National Coalition for State Housing Agencies sent a Feb 8, 2022 letter to urge Treasury to fix technology problems with its reporting portal, streamline reporting requirements and provide technical assistance to ERA grantees. Oregon also experienced challenges getting responses from Treasury about around reporting questions, but we understand that our federal partners were also operating under emergency circumstances and were also strained to capacity. Corrective action plan: OHCS has attempted multiple times to submit the FFATA, however the award was never made available to report on within the system. OHCS has also reached out to US Treasury multiple times to confirm that we were not required to report but have yet to hear directly from US Treasury. OHCS was able to confirm and received a response from US Treasury that went to another state that grantees were not required to complete the FFATA on the federal reporting website as US Treasury was doing that on behalf of the recipient, and OHCS did share that correspondence with SOS. Although US Treasury has been nonresponsive, OHCS will continue to attempt to obtain a direct response from US Treasury for our own records. Anticipated Completion Date: December 31, 2023 Contact: Beth Brown, Accounting Manager

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

2022-064 Oregon Department of Transportation Management should ensure timely review of transfers is documented Federal Awarding Agency: U.S. Department of Transportation Assistance Listing Number and Name: 20.205 Highway Planning and Construction Federal Award Numbers and Years: Various Compliance Requirement: Activities Allowed or Unallowed; Allowable Costs/Cost Principles Type of Finding: Significant Deficiency Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.303; GAO-17-704G ?10.03, 12.05; ODOT FASM 3.7 The department is responsible for establishing and maintaining internal controls to ensure entries posted in the accounting records are for costs and activities allowable under the federal program. Journal entry review and approval should be clearly documented and readily available for examination. The department has established Financial Administration Standard 3.7, Expenditure Journal Entries, which requires management to transmit signed hard copy supporting documentation of journal entries to financial services after they?ve been reviewed and approved. We tested 40 transfer journal entries moving costs between federal project sub jobs and found that 19 did not have documentation of timely approval. In two cases, approval was documented more than a year after costs were transferred. The 19 entries were all lump sum transfers processed by Program and Funding Services (P&FS). P&FS is authorized to process transfers, moving costs between sub jobs of the same project. These transfers are necessary to align project costs with the appropriate funding source. Per P&FS management, transfers are generally reviewed within a few days. However, documentation of the review has not been occurring until much later due to challenges associated with remote work and policies requiring hard copy documentation. Over $90 million in program costs were transferred between sub jobs in this manner during fiscal year 2022. Without timely review and documentation available to support transfers, unallowable costs or activities could be transferred and billed erroneously to the Federal government. We recommend management ensure procedures for review of transfer journal entries result in timely documented approvals. MANAGEMENT RESPONSE: We agree with this recommendation. Until electronic signatures are implemented, a Federal Aid Funding staff member will be required to print the hard copies, in the office at least monthly; as well as a member of the Statewide Investments Section management team will need to be present to sign the hard copies. Anticipated Completion Date: May 4, 2023 Contact: Katie Parlette, Federal Aid Funding Manager

2022-062 Higher Education Coordinating Commission Improve controls over payroll Federal Awarding Agency: U.S. Department of Labor Assistance Listing Number and Name: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Workers Formula Grant Federal Award Numbers and Years: AA33251LN0; 2019, AA33251L70; 2019, AA33251L90; 2019, AA33251R70; 2019, AA33251R90; 2019, AA34789VS0; 2020, AA34789V90; 2020, AA34789VQ0; 2020, AA347893L0; 2020, AA347895P0; 2020, AA36341E10; 2021, AA36341D90; 2021, AA36341DQ0; 2021, AA36341KY0; 2021,AA36341LA0; 2021 Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 200.303 Federal regulations require recipients of federal awards to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. The department has implemented the following procedures to ensure payroll costs are correctly charged to the program. Managers approve monthly timesheets submitted by the employees in the state?s payroll system. When managers do not approve by a specified date, the payroll system will automatically approve the timesheet, shown with the words ?system approved.? Additionally, each employee should have a signed position description, which details the duties of the position and the amount of time to be charged for the duties. We selected a nonstatistical random sample of 20 employee timesheets related to 12 employees to ensure payroll was appropriately charged to the program. Additionally, we selected one employee who was on job rotation with the agency from January 2022 through June 2022. We verified payroll timesheets were reviewed by a manager and signed position descriptions were retained per state guidelines, and identified the following exceptions: Two timesheets for one employee did not have evidence of manager approval and 2 timesheets for two employees were reviewed over three months later. For all 12 employees, the position descriptions provided were unsigned or signed upon our request. We did not question these costs as department management verified job duties were appropriate to the program. For the employee on job rotation, 4 of the 6 timesheets were not reviewed and a signed position description was not signed by the employee. According to department management, timesheets were not always approved by the manager as the system will automatically lock and approve the timesheet. For position descriptions, supervisor did not always follow through on obtaining signed position descriptions and for longer term employees a number of boxes could not be located when the agency moved. There is a risk that employees could be improperly charging to the federal program. We recommend department management ensure timesheets are timely reviewed and positions descriptions are completed and retained. MANAGEMENT RESPONSE: We agree with this recommendation. To improve controls over payroll, the HECC and the State of Oregon switched its payroll system from the old Legacy Oregon State Payroll Application (OSPA ? Epay) to the new Workday Payroll as of December 1, 2022. The HECC has since created reminder emails to all Management Staff to submit their respective employees? timesheets in a timely manner. In addition, the new Workday Payroll does not have a feature that automatically locks an employee?s timesheet and auto-approves a timesheet. Each Manager must now manually approve a timesheet for any employee that enters specific time codes for particular grants or use of funds. To address the finding regarding unsigned position descriptions (PDs), the HECC has since ensured that all of the identified PDs have been signed. HECC?s Human Resources Unit (HR) has created a new process going forward requiring all managers to sign the PD at the time of the offer letter and HECC HR to collect the signature from the employee on their first day when HR meets with them. HECC HR also has reviewed all of its existing employees? position description in this process to ensure all positions descriptions are signed. Anticipated Completion Date: August 31, 2023 Contact: Christopher Bui, Budget and Fiscal Manager

2022-061 Higher Education Coordinating Commission FFATA reports were not prepared or submitted Federal Awarding Agency: U.S. Department of Labor Assistance Listing Number and Name: 17.258 WIOA Adult Program 17.259 WIOA Youth Activities 17.278 WIOA Dislocated Worker Formula Grant Federal Award Numbers and Years: AA33251LN0; 2019, AA33251L70; 2019, AA33251L90; 2019, AA33251R70; 2019, AA33251R90; 2019, AA34789VS0; 2020, AA34789V90; 2020, AA34789VQ0; 2020, AA347893L0; 2020, AA347895P0; 2020, AA36341E10; 2021, AA36341D90; 2021, AA36341DQ0; 2021, AA36341KY0; 2021, AA36341LA0; 2021 Compliance Requirement: Reporting Type of Finding: Significant Deficiency; Noncompliance Prior Year Finding: N/A Questioned Costs: N/A Criteria: 2 CFR 170; 2 CFR 200.303 The WIOA Cluster is subject to subaward reporting under the Federal Funding Accountability and Transparency Act (FFATA). FFATA requires the department to submit information for any subaward action that equals or exceeds $30,000 in the FFATA Subaward Reporting System (FSRS). Reports should be submitted no later than the end of the month following the month in which the subawards were made. Federal regulations also require recipients of federal awards to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Upon inquiry of the department, we determined it had not submitted any subaward information to the FSRS during fiscal year 2022. Department management stated FFATA reporting was not completed due to staff turnover. We also reviewed information the department had submitted at USAspending.gov and determined the department had not submitted any subaward information to FSRS since 2017. The agency is not in compliance with FFATA reporting requirements. Additionally, the department is not transparent in the spending decisions of these federal awards. We recommend department management implement controls to timely prepare and submit the monthly FFATA reports as required by federal regulations. The department should also work with the federal awarding agency to determine what actions it should take for older reports not submitted. MANAGEMENT RESPONSE: We agree with this recommendation. According to the findings, the HECC didn?t submit any subaward information to the FSRS during fiscal year 2022. Furthermore, the Department had not submitted any subaward information to FSRS since 2017. The HECC acknowledges these findings are correct. Due to these findings, HECC has implemented procedures to ensure timely entry into the FFATA Subaward Reporting System (FSRS) of all awards that equal or exceed $30,000. In addition, HECC has granted FSRS access to several high-level accountants to ensure that there is always staff on hand to make these entries. The procedures include a checkbox on the cover page of every agreement that delineates when a FSRS entry is required. Anticipated Completion Date: May 31, 2023 Contact: Christopher Bui, Budget and Fiscal Manager