Corrective Action Plans

Finding 1182885 (2025-015)

Material Weakness 2025

SC

Allowable Costs / Cost Principles Subrecipient Monitoring § 200.303

Criminal Justice Academy respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers ...

Criminal Justice Academy respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT Department of Transportation 2025-015 State and Community Highway Safety & National Priority Safety Programs – Assistance Listing No. 20.600 & 20.616 Disposition of Audit Finding: The South Carolina Criminal Justice Academy (SCCJA) concurs with the audit finding. Corrective Action: Agency policy was previously amended to ensure adequate internal controls. Additional staff training has been conducted to ensure full understanding of the policy changes to prevent future errors. Anticipated Completion Date: 10/30/2025 Name of the contact person responsible for corrective action: • Lauren Wright at (803) 896-8115

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Finding 1182883 (2025-014)

Material Weakness 2025

State of South Carolina

SC

Reporting Subrecipient Monitoring § 200.303

The South Carolina Department on Aging (SCDOA) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consiste...

The South Carolina Department on Aging (SCDOA) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT U.S. Department of Health and Human Services (HHS) – Administration for Community Living (ACL) 2025-014 Aging Cluster – Assistance Listing No. 93.044, 93.045, and 93.053 Disposition of Audit Finding: The SCDOA concurs with the audit finding. Corrective Action: To prevent future occurrences, the Department will implement the following measures: • A secondary review process has been established requiring supervisory approval before report submission. • Supporting documentation including general ledgers will be cross-referenced prior to finalization and documentation will be saved. Anticipated Completion Date: 12/05/2026 Names of the contact persons responsible for corrective action: • Syeeda Gallman, Finance Director at 1-803-734-9917 • Towanda Prior, Grants Manager at 1-803-734-9950

View Audit 394274

Finding 1182878 (2025-013)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Special Tests & Provisions Significant Deficiency § 200.303

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings ...

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT U.S. Department of Health and Human Services Medicaid Cluster – Assistance Listing No. 93.775, 93.777, and 93.778 Disposition of Audit Finding: The SCDHHS concurs with the audit finding. Corrective Action: Management hereby proposes the Corrective Action Plan below. The Department will implement a control to ensure that the following Codes of Federal Regulations are being met: 42 CFR 438.602 (e) The state has implemented this requirement into its’ July 1, 2024 through June 30, 2027 contract with the MCOs. While the contract gives the MCOs a three-year period to have this audit completed, SC DHHS will engage each MCO to make a commitment to the date to have this audit completed and submitted. The audits will be submitted to the Director, Medicaid Managed Care Financing with copies to the Bureau Chief of the Bureau of Managed Care, and the Director of Strategic Communications in the Office of Communications and Public Relations. The Director, Medicaid Managed Care Financing will be responsible for tracking the submissions. 42 CFR 438.602 (g) The specific reference to the posting of the results of any audits under paragraph (e) is 42 CFR 438.602 (g)(4). The expected date of submission of the audits required under paragraph (e) will be provided to the Bureau Chief of the Bureau of Managed Care and the Director of Strategic Communications in the Office of Communications and Public Relations. The Director, Medicaid Managed Care Financing will be responsible for tracking the submissions and confirming with the Office of Communications and Public Relations the audits have been posted to the agency’s website. Anticipated Completion Date: June 30, 2026 Name of the contact person responsible for corrective action: • T Clark Phillip at (803) 898-1017

View Audit 394274

Finding 1182874 (2025-012)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Special Tests & Provisions Significant Deficiency § 200.303

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings ...

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT U.S. Department of Health and Human Services Medicaid Cluster – Assistance Listing No. 93.775, 93.777, and 93.778 Disposition of Audit Finding: The SCDHHS concurs with the audit finding. Corrective Action: In accordance with the current contract with the state survey and certification agency, the South Carolina Department of Public Health (DPH), SCDHHS has implemented the following actions to address the Provider Health and Safety Standards audit finding: • SCDHHS requires DPH to submit a quarterly summary report to SCDHHS which identifies nursing facilities surveyed, and F tags cited, including scope and severity measures. • SCDHHS requires DPH to submit a cumulative end-of-year report confirming that each facility has had a survey within an average interval not to exceed 12 months, and no later than 15 months after the date of the previous survey. • SCDHHS and DPH hold quarterly meetings to review the submitted reports and discuss findings. Meetings were held on 7-25-25 and 10-30-25, and the next meeting is scheduled for 1-15-26. Anticipated Completion Date: Completed Contact persons responsible for corrective action: • Margaret Alewine at (803) 898-0047 • Lisa Ragland at (803) 898-1387

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Finding 1182870 (2025-011)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Special Tests & Provisions Eligibility § 200.303

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings ...

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT U.S. Department of Health and Human Services Medicaid Cluster – Assistance Listing No. 93.775, 93.777, and 93.778 Disposition of Audit Finding: The SCDHHS management concurs with the audit finding. Corrective Action: Regarding the Provider Enrollment Revalidation finding - One provider whose last enrollment validation date was 5/10/2014. The revalidation date for this provider would have been due by 5/10/2019 which would have been before the start of the Public Health Emergency (PHE). The current Provider Enrollment and Support Functions Team Director was not with SCDHHS at the time of the missed revalidation and we are unable to attest to reasons this provider did not complete revalidation, as required. Anticipated Completion Date: Our post-PHE revalidation restart began in July 2024 and will conclude by the required completion date of February 28, 2027. Once SCDHHS completes our current revalidation schedule, we will resume normal revalidation cadence. Contact persons responsible for corrective action: • Dawn Hunt at (803) 898-1843 • Nick Constantino at (803) 898-2561

View Audit 394274

Finding 1182866 (2025-010)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Special Tests & Provisions § 200.303

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings ...

The South Carolina Department of Health and Human Services (SCDHHS) respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAM AUDIT U.S. Department of Health and Human Services 2025-010 Medicaid Cluster – Assistance Listing No. 93.775, 93.777, and 93.778 Disposition of Audit Finding: The SCDHHS management concurs with the audit finding. Corrective Action: • Regarding the five providers identified as not meeting SCDHHS eligibility requirements, we do not currently have a process, nor a mechanism in place, that allows SCDHHS to monitor the status of provider licenses issued by South Carolina Department of Labor, Licensing and Regulation (SCLLR) or Department of Public Health (DPH). Currently, a provider’s license status is verified during initial enrollment and revalidation. • Recently, SCDHHS completed a project with SCLLR to implement a data exchange allowing access to South Carolina provider licensing information specific to independent pharmacy services. We intend to broaden the scope of our project work with SCLLR to include the license status information for all South Carolina Medicaid providers. While we are actively engaged with SCLLR, we have had initial conversations with DPH and intend to replicate the data exchange process with them for entities licensed by DPH. Anticipated Completion Date: Currently, we do not have a final implementation date but estimate that this could be a six – 12-month timeline following execution of a signed Data Sharing Agreement (DSA). This estimate not only includes work with SCLLR but also required updates to our Medicaid Management Information System (MMIS) and development of associated policies and procedures. Once we have additional information, we will provide an update. Contact persons responsible for corrective action: • Dawn Hunt at (803) 898-1843 • Nick Constantino at (803) 898-2561

View Audit 394274

Finding 1182862 (2025-009)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Questioned Costs Significant Deficiency § 200.303 § 200.306

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT U.S. Department of Defense National Guard Military Operations and Maintenance (O&M) Projects – Assistance Listing No. 12.401 Disposition of Audit Finding: The Office of the Adjutant General concurs with the audit finding. Corrective Action: The Agency will strengthen controls by enhancing annual trainings to ensure matching requirements are properly tracked, documented, and applied to Federal expenditures as required by the Federal award. Additional notes will be added on the Federal Final Modification forms to address any differences required by the Cooperative Agreement. Anticipated Completion Date: 10/01/2026 Name of the contact person responsible for corrective action: Anita Ballington at 803-299-2031

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Finding 1182861 (2025-008)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Period of Performance Questioned Costs § 200.303 § 200.403

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT U.S. Department of Defense National Guard Military Operations and Maintenance (O&M) Projects – Assistance Listing No. 12.401 Disposition of Audit Finding: The Office of the Adjutant General concurs with the audit finding. The $2,571 finding was identified by the Agency prior to the audit. The Agency was only able make corrections to the grants which remained open (total of $1,421). The Agency was unable to make corrections for the remaining amount as those grants had been closed. Corrective Action: The Agency relies on SCEIS workflow approvals to verify and approve the period of performance. The Agency currently has three or four levels of approvals (depending on the specific grant) for each Shopping Cart. During this process, the Shopping Carts are reviewed and approved/disapproved by the Cooperative Agreement budget analyst, the Grants Department, the Procurement Department and the Budget & Finance Department. Annual reminders are sent to each Cooperative Agreement and email verification of disbursements are filed. Additional quarterly quality control checks will be added to the process. Anticipated Completion Date: 6/30/2026 Name of the contact person responsible for corrective action: Anita Ballington at 803-299-4294

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Finding 1182860 (2025-007)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Cash Management Allowable Costs / Cost Principles § 200.303

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT U.S. Department of Defense National Guard Military Operations and Maintenance (O&M) Projects – Assistance Listing No. 12.401 Disposition of Audit Finding: The Office of the Adjutant General non-concurs with the audit finding. 1. The cited Regulation (National Guard Regulation 5-1) was changed from a Regulation to a policy guideline in 2020 by the National Guard Bureau (NGB) Grants and Cooperative Agreements Policy Letter (GCAPL) #20-02 dated 04 February 2020. 2. There is not a risk for interest liability to the State. The basis and thresholds for determining if a program is subject to interest payments is defined in Federal Code 31 CFR Part 205 and Treasury Financial Manual (TFM) 4A-2000, “Overall Disbursing Rules for All Federal Agencies.” In addition, the Cash Management Improvement Act Agreement (CIMA) between The State of South Carolina and The Secretary of the Treasury, United States Department of the Treasury, dated 6/30/2025, does not list the Agency’s Catalogue of Federal Domestic Assistance (CFDA) 12.401 as one of the State’s programs that meets or exceeds the State’s threshold for major Federal assistance programs. 3. The Cash Management testing used a one-to-one analysis based on monthly cash advance requests and monthly expenditures during the same time period. However, the testing, based on NGB Policy 5-1, should be from the date of receipt to the date of disbursement. 4. Lastly, the State of South Carolina’s Department of Administration does not allow submissions for Capital Projects (projects over $250,000) without the funding in possession of the requesting Agency. In addition, neither the Legislative Joint Bond Review Committee (JBRC) nor the State Fiscal Accountability Authority (SFAA) will approve a Capital Project without the Agency having the required funds on-hand. The average Readiness Center Revitalization (Capital Project) can take 2-3 years to complete, and the total funds have to be on-hand to receive approval for the start of the projects. This requires Cooperative Agreement 1001 to advance funding for projects months ahead of the execution of any Purchase Orders. Corrective Action: The Agency will continue to strive to minimize the time elapsed between transfer of funds from the United States Treasury and their disbursement by the State in accordance with the annual Request for Advance Payment Method Authorization signed between the State/Agency and the United States Property and Fiscal Officer (USPFO). Anticipated Completion Date: Current Name of the contact person responsible for corrective action: Anita Ballington at 803-299-4294

View Audit 394274

Finding 1182859 (2025-006)

Material Weakness 2025

State of South Carolina

SC

Allowable Costs / Cost Principles Subrecipient Monitoring Matching / Level of Effort / Earmarking § 200.303

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT U.S. Department of Defense National Guard Military Operations and Maintenance (O&M) Projects – Assistance Listing No. 12.401 Disposition of Audit Finding: The Office of the Adjutant General concurs with the audit finding. Corrective Action: The Agency will continue to monitor reports and ensure each Cooperative Agreement adheres to the established Chart of Accounts. The Agency will continue to review purchase submissions in the SCEIS system for adherence to Cooperative Agreement matching requirements. Anticipated Completion Date: 10/01/2026 Name of the contact person responsible for corrective action: Anita Ballington at 803-229-4294

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Finding 1182858 (2025-005)

Material Weakness 2025

State of South Carolina

SC

Allowable Costs / Cost Principles Subrecipient Monitoring § 200.303 § 200.430

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT U.S. Department of Defense National Guard Military Operations and Maintenance (O&M) Projects – Assistance Listing No. 12.401 Disposition of Audit Finding: The Office of the Adjutant General concurs with the audit finding. Corrective Action: The Agency has added additional quality control measures within the approval process, is hiring an additional staff member who will be responsible for auditing personnel actions and personnel files, and has implemented monthly audits in addition to the current standard of annual audits. Anticipated Completion Date: 6/30/2026 Name of the contact person responsible for corrective action: Robert Faulk at 803-299-4337

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Finding 1182857 (2025-004)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring § 200.303

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT United States Department of Homeland Security Public Assistance (Presidentially Declared Disasters) - Assistance Listing No. 97.036 Disposition of Audit Finding: The SCEMD of the Office of the Adjutant General concurs with the audit finding. Corrective Action: 1. The SCEMD Finance and Administration staff will implement and/or update the succession plan for any role or team member responsible for duties within the FFATA reporting process. 2. SCEMD will continue its monthly review of the South Carolina Recovery Grants (SCRG) platform by the SCEMD Finance and Administration staff to ensure the accuracy of information gathered for FFATA reporting. Where any prior reporting inaccuracies may be identified, FFATA reporting corrections of subrecipient obligations will be made. Anticipated Completion Date: June 30, 2026 Name of the contact person responsible for corrective action: Landry Phillips at LPhillips@emd.sc.gov or 803-737-8559

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Finding 1182855 (2025-003)

Material Weakness 2025

State of South Carolina

SC

Subrecipient Monitoring Period of Performance Questioned Costs § 200.303 § 200.403

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consi...

The South Carolina Office of the Adjutant General respectfully submits the following corrective action plan for the year ended June 30, 2025, on behalf of the State of South Carolina. The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Findings — FEDERAL AWARD PROGRAM AUDIT United States Department of Homeland Security 2025-003 Public Assistance (Presidentially Declared Disasters) - Assistance Listing No. 97.036 Disposition of Audit Finding: The South Carolina Emergency Management Division (SCEMD) of the Office of the Adjutant General concurs with the audit finding. Corrective Action: The Agency will refine its Public Assistance (PA) Reimbursement Review SOP and related Recovery Grants and Finance staff training to specify a requirement to validate that for projects under PA grants declared in 2018 and before, Direct Administrative Costs (DAC) were expended before the end of the project period of performance. In addition, the Recipient has submitted a time extension for the project period of performance but does not yet have approval from FEMA. Notes: • DAC was an eligible category of costs in PA projects under disaster grants through 2017 and optional for those declared August 1, 2017, through October 04, 2018 (opt-in). • Federal PA policy shifted to a management costs approach for projects under incidents declared on or after October 05, 2018. See attached FEMA Recovery Policy FP 104-11-2. Management costs are eligible for reimbursement up to 180 days after the subrecipient completes its last non-management cost project (p. 5). • Guidance regarding Direct Administrative Costs (see FEMA table attached) indicates that project closeout activities are eligible direct costs,which may have led to the Recipient considering DAC during the closeout period as eligible even when the project period of performance had ended. • The Federal Agency involved, FEMA, closed the project without noting an issue with reimbursement of these expenditures. Anticipated Completion Date: June 30, 2026 2 Name of the contact person responsible for corrective action: • Emily Bentley, SCEMD Chief of Mitigation and Recovery, at (803) 737-8774 • Antonio Johnson, SCEMD Grants and Finance Manager, at (803) 737-8606

View Audit 394274

Finding 1182845 (2025-021)

Material Weakness 2025

State of Vermont

VT

Eligibility Matching / Level of Effort / Earmarking Questioned Costs § 200.303

Reference Number: 2025-021, 2019-010 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2405VT5MAP (10/1/2023 – 9/30/2024) 2505VT5MAP (10/1/2024...

Reference Number: 2025-021, 2019-010 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Medicaid Cluster Assistance Listing Number: 93.775, 93.777, 93.778 Award Number and Year: 2405VT5MAP (10/1/2023 – 9/30/2024) 2505VT5MAP (10/1/2024 – 9/30/2025) Compliance Requirement: Special Tests and Provisions - Provider Health and Safety Standards Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review procedures and controls and complete implementation of its corrective action plan from a prior audit to ensure that documentation is maintained in accordance with program requirements and that all providers are compliant with required health and safety standards. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: All Letters of Good Standing as well as a Standard Operating Procedure to ensure continuation were implemented in April of 2022. Prior to April the process was manual and via telephone or email with the Tax Department. All providers who had their tax standing validated prior to April 2022 via phone or email were not solicited to get a written notification from the Tax Commissioner. As of April 2022, all tax standing reviews are validated within the Vermont Department of Taxes MyVTax portal. A confirmation of good standing is uploaded to the case within the Provider Management Module (PMM) and documented within the system. If verification cannot occur through the MyVTax portal, a Lexis Nexis report is run to validate if any liens or judgments result, the report is attached within PMM, and the system is documented. If verification of good standing does not result from either method, the application is returned to the provider to produce written confirmation of good standing from the Vermont Department of Taxes. The document is uploaded into PMM at this point. Although the Agency has implemented its corrective action plan from a prior year audit, cases will still be identified under this CAP until the provider is due for their 5-year revalidation and successfully revalidates with VT Medicaid. The additional provider identified during the selection of sixty providers for testing, for which a tax standing verification was not performed during revalidation, was the result of an isolated oversight attributable to human error. The Agency has determined that this instance does not reflect a systemic deficiency in the tax verification process. A tax standing verification for the identified provider was conducted post-audit in September 2025 and confirmed the provider was in Good Standing. Scheduled Completion Date of Corrective Action Plan: Completed Contacts for Corrective Action Plan: Deidra Jarvis, Provider Member Relations Manager, diedra.jarvis@vermont.gov Peter Moino, AHS Director of Internal Audit, peter.moino@vermont.gov

View Audit 394235

Finding 1182842 (2025-020)

Material Weakness 2025

State of Vermont

VT

Questioned Costs Student Financial Aid Eligibility § 200.303

Reference Number: 2025-020 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Foster Care – Title IV-E Assistance Listing Number: 93.658 Award Number and Year: 2401VTFOST (10/1/2023 – 9/30/2025) 2501VTFOST (10/1...

Reference Number: 2025-020 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: Foster Care – Title IV-E Assistance Listing Number: 93.658 Award Number and Year: 2401VTFOST (10/1/2023 – 9/30/2025) 2501VTFOST (10/1/2024 – 9/30/2026) Compliance Requirement: Eligibility Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend that the Agency review and enhance procedures and controls to ensure that it correctly identifies the eligible federal program for all cases coded in CDDIS. We further recommend that children on whose behalf payments are charged to Foster Care are eligible for benefits under the program. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Agency will work with the IT systems of both the Family Services and Child Development Divisions to ensure that accurate eligibility information is shared between the systems. This will include: 1. What program each child is eligible for, adoption or foster care 2. The accurate start and end dates of eligibility 3. Any changes to eligibility during the life of a case The staff from Family Services will ensure that all Title IV-E eligibility information is shared with IT as they create the processes to share that information with the Child Development Division. The staff at the Child Development Division will work with their IT vendor to ensure all updates are completed and tested to ensure that Title IV-E funds are being claimed appropriately. Scheduled Completion Date of Corrective Action Plan: The underlying work to clarify the eligibility information needed has already begun and the process of updating the IT systems on both the FSD and CDD sides will be completed by April 1, 2026. Contacts for Corrective Action Plan: Heather McLain, Revenue Enhancement Director, Family Services, heather.mclain@vermont.gov Brenda Hallock, Revenue Team Lead, Family Services, brenda.hallock@vermont.gov Karolyn Long, Operations Director, Child Development Division, karolyn.long@vermont.gov Ed Dwinell, Financial Director, DCF Business Office, ed.dwinell@vermont.gov Peter Moino, AHS Director of Internal Audit, peter.moino@vermont.gov

View Audit 394235

Finding 1182838 (2025-018)

Material Weakness 2025

State of Vermont

VT

Questioned Costs Procurement, Suspension & Debarment Subrecipient Monitoring § 200.303

Reference Number: 2025-018 Prior Year Finding: 2024-018, 2023-024 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Hea...

Reference Number: 2025-018 Prior Year Finding: 2024-018, 2023-024 Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Assistance Listing Number: 93.391 Award Number and Year: NH75OT000034 (6/1/2021 – 3/24/2025) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency complete implementation of its prior year CAP to ensure that all required subawards and subaward modifications are reported timely to FSRS in accordance with FFATA requirements and that all previously issued subawards are reported. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Financial Administrator will ensure that subrecipient grants containing federal funding that meet the FFATA reporting threshold are marked as “required for entry into the FFATA system” upon grant execution. The Financial Administrator and Manager will then confirm that all executed agreements that meet the FFATA reporting requirement have been entered and submitted into the federal reporting system by the last business day of each month. Please note that the scheduled completion date is February 1, 2023 as the same FFATA reporting finding was identified for a different program during the SFY22 Single Audit, and the corrective action plan was applied across the Department as a whole. The FFATA issues identified in the SFY25 Single Audit pre-dated the implementation of the Health Department’s original corrective action plan. Scheduled Completion Date of Corrective Action Plan: February 1, 2023 Contacts for Corrective Action Plan: Lillian Smith, Financial Administrator, Vermont Department of Health, lillian.smith@vermont.gov Jessica Brown, Financial Manager, Vermont Department of Health, jessica.brown@vermont.gov Megan Hoke, Financial Director, Vermont Department of Health, megan.hoke@vermont.gov Peter Moino, Director of Internal Audit, Vermont Agency of Human Services, peter.moino@vermont.gov

View Audit 394235

Finding 1182837 (2025-017)

Material Weakness 2025

State of Vermont

VT

Procurement, Suspension & Debarment § 200.219 § 200.303 § 200.324

Reference Number: 2025-017 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcar...

Reference Number: 2025-017 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Assistance Listing Number: 93.391 Award Number and Year: NH75OT000034 (6/1/2021 – 3/24/2025) Compliance Requirement: Procurement Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that it maintains documentation that it performs a cost analysis for all procurement actions in accordance with Agency of Administration Bulletin No. 3.5 and federal requirements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The VDH Director of Communications will ensure that copies of any cost analysis performed as part of the RFP review process are collected from department staff and saved in the procurement files for the associated contract. Documentation will be maintained according to Administrative Bulletin 3.5 and federal records retention requirements. Scheduled Completion Date of Corrective Action Plan: March 1, 2026 Contacts for Corrective Action Plan: Katie Warchut, Director of Communications, Vermont Department of Health, katie.warchut@vermont.gov Megan Hoke, Financial Director, Vermont Department of Health, megan.hoke@vermont.gov Peter Moino, Director of Internal Audit, Vermont Agency of Human Services, peter.moino@vermont.gov

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Finding 1182836 (2025-016)

Material Weakness 2025

State of Vermont

VT

Reporting Questioned Costs Period of Performance § 200.303

Reference Number: 2025-016 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) Assistance Listing Number: 93.323 Award Number and Year...

Reference Number: 2025-016 Prior Year Finding: No Federal Agency: U.S. Department of Health and Human Services State Agency: Agency of Human Services Federal Program: COVID-19 - Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) Assistance Listing Number: 93.323 Award Number and Year: 19NU50CK000520 (8/1/2019 – 7/31/2027) Compliance Requirement: Reporting – Financial Reports Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that financial reports are accurate and agree with supporting documentation. The reviewer should verify that reports are tied to supporting documentation before they are approved and submitted. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: For each required financial report, the Financial Administrator will prepare the appropriate information and review it with the PH Program Manager prior to submission to the CDC. Amounts reported by budget category will align with the budget category generated by the Department’s financial reporting system. Any changes made to the amounts reported by budget category will be discussed by the PH Program Manager and the Financial Administrator and documented in the report backup file. Once the financial information has been reviewed by both the Financial Administrator and the PH Program Manager, the PH Program Manager will submit the financial information into the CDCs reporting system. After the report has been submitted the PH Program Manager will save a screenshot or some other form of documentation verifying timely submission. A copy of the submitted report will be sent to the Financial Administrator who will perform a final review of the data submitted to the CDC. Copies of the backup file and final submitted report will remain in the business office federal grant records for the required retention period associated with the federal grant award. Scheduled Completion Date of Corrective Action Plan: January 1, 2026 Contacts for Corrective Action Plan: Mia Romeo, Financial Administrator, Vermont Department of Health, mia.romeo@vermont.gov Catie Markesich, PH Program Manager, Vermont Department of Health, catherine.markesich@vermont.gov Megan Hoke, Financial Director, Vermont Department of Health, megan.hoke@vermont.gov Peter Moino, Director of Internal Audit, Vermont Agency of Human Services, peter.moino@vermont.gov

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Finding 1182834 (2025-015)

Material Weakness 2025

State of Vermont

VT

Questioned Costs Reporting Significant Deficiency § 200.303

Reference Number: 2025-015 Prior Year Finding: No Federal Agency: U.S. Department of Education State Agency: Agency of Human Services Federal Program: Rehabilitation Services – Vocational Rehabilitation Grants to States Assistance Listing Number: 84.126 Award Number and Year: H126A240067 (10/1/2023 ...

Reference Number: 2025-015 Prior Year Finding: No Federal Agency: U.S. Department of Education State Agency: Agency of Human Services Federal Program: Rehabilitation Services – Vocational Rehabilitation Grants to States Assistance Listing Number: 84.126 Award Number and Year: H126A240067 (10/1/2023 – 9/30/2025) H126A240068 (10/1/2023 – 9/30/2025) Compliance Requirement: Reporting – Case Services Report (RSA-911) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Agency review and enhance internal controls and procedures to ensure that Case Service Reports are accurate and agree with supporting documentation. The reviewer should verify that reports are tied to supporting documentation before they are approved and submitted. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The HireAbility Performance Management team will conduct a training for all counselors on expectations for documentation in alignment with the regulations for element 398. After the training, the team will conduct a bi-monthly review of 40 cases statewide to ensure the date reported on the RSA-911 and the case documentation match. The team will continue these reviews over the course of two quarters (six months). The results of these reviews will be kept in a spreadsheet for documentation purposes. Information to be captured on this spreadsheet will include the case ID, counselor of record, reported IPE date, and date on supporting IPE documentation. For caseloads that do not have matching documentation, the Performance Management team will meet with the counselor’s supervisor to discuss ways to improve their case practices. Scheduled Completion Date of Corrective Action Plan: The two quarters of case reviews will be completed by the last day of the month, starting in January 2026 and ending on June 30, 2026. Contacts for Corrective Action Plan: Amanda Arnold, Vocational Rehabilitation (VR) Quality Assurance Manager, amanda.arnold@vermont.gov Peter Moino, AHS Director of Internal Audit, peter.moino@vermont.gov

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Finding 1182833 (2025-014)

Material Weakness 2025

State of Vermont

VT

Reporting § 200.303 § 200.502

Reference Number: 2025-014 Prior Year Finding: No Federal Agency: U.S. Environmental Protection Agency State Agency: Department of Environmental Conservation Federal Program: Drinking Water Sate Revolving Fund Assistance Listing Number: 66.468 Award Number and Year: 99121S23 (10/1/2023 – 9/30/2030) ...

Reference Number: 2025-014 Prior Year Finding: No Federal Agency: U.S. Environmental Protection Agency State Agency: Department of Environmental Conservation Federal Program: Drinking Water Sate Revolving Fund Assistance Listing Number: 66.468 Award Number and Year: 99121S23 (10/1/2023 – 9/30/2030) 99121E23 (10/1/2023 – 9/30/2030) Compliance Requirement: Reporting – Schedule of Expenditure of Federal Awards Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend the Department review and enhance internal controls and procedures for SEFA preparation to ensure that expenditures are reported accurately on the SEFA. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: This error was caused by a data entry error by our Agency Central Office as they are the entity that enters all vouchers into the Vision Accounting system. This error was discovered by us during our normal monthly review of all federal grant expenditures that we complete before we process our federal draws. Unfortunately, this error occurred in June, which is the last month of the fiscal year, and the reviews happen after the month is closed in the accounting system and we can run all our reports for the month. That being the case, the correction had to be entered in July which is a different fiscal year and was not reflected in the data that was used to complete the SEFA for the prior fiscal year. As a result, we have reviewed our internal controls to more effectively prevent and/or detect errors upon transaction entry into Vision in collaboration with the Agency Central Office and to also ensure expenditures are reported accurately on the SEFA, by incorporating the following additional steps when preparing the SEFA: 1. Running a report from the state finance system (VISION) that will show any corrections that were made that pertain to the prior fiscal year transactions and adjust the SEFA amounts accordingly. 2. Running an additional balance report from the Loans and Grants Tracking System (LGTS) to help reconcile total amounts spent on loan disbursements under the Assistance Listing Numbers (ALN) and compare that to the total transactions in Vision to ensure they match. Scheduled Completion Date of Corrective Action Plan: July 1, 2026 Contacts for Corrective Action Plan: Mercedes Piñón, AID Financial Manager III, mercedes.pinon@vermont.gov David Pasco, AID Financial Director I, david.pasco@vermont.gov

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Finding 1182832 (2025-013)

Material Weakness 2025

State of Vermont

VT

Questioned Costs Procurement, Suspension & Debarment Subrecipient Monitoring § 200.303

Reference Number: 2025-013 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Public Service Department Department of Libraries Federal Program: COVID-19 – Coronavirus Capital Projects Fund Assistance Listing Number: 21.029 Award Number and Year: CPFFN0202 (2/4/2022...

Reference Number: 2025-013 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Public Service Department Department of Libraries Federal Program: COVID-19 – Coronavirus Capital Projects Fund Assistance Listing Number: 21.029 Award Number and Year: CPFFN0202 (2/4/2022 – 12/31/2026) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Departments’ review their procedures and internal controls to ensure that subawards are reported timely to SAM.gov in accordance with FFATA requirements. Views of responsible officials: Management agrees with the finding. Corrective Action Plan: The Departments of Public Service and Libraries, reporting obligations for Federal Funding Accountability and Transparency Act Subaward in SAM.gov will occur on a timely basis. Training for these responsibilities is provided for new employees and ad hoc as the system updates and as SAM.gov releases periodic training. A procedural job aid is in place with detailed instructions for staff who are responsible for the inputs. Compliance will be reported regularly to internal leadership. Written procedures for regular reporting to management about FFATA reporting will be established by the grants and contracts staff. A quarterly meeting will be established between the Departments to discuss and ensure that the reporting obligations have been met. Scheduled Completion Date of Correction Action Plan: Quarterly meeting established. March 31, 2026 Procedural job aid created March 31, 2026 Training provided to employees June 30, 2026 Management monitoring process established June 30, 2026 Contacts for Corrective Action Plan: Brittney Wilson, Deputy Commissioner, brittney.wilson@vermont.gov Tracy Collier, Administrative Services Director, tracy.collier@vermont.gov

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Finding 1182831 (2025-012)

Material Weakness 2025

State of Vermont

VT

Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties Questioned Costs § 200.303

Reference Number: 2025-012 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Agency of Administration Public Service Department Federal Program: COVID-19 – Coronavirus Capital Projects Fund Assistance Listing Number: 21.029 Award Number and Year: CPFFN0202 (2/4/202...

Reference Number: 2025-012 Prior Year Finding: No Federal Agency: U.S. Department of the Treasury State Agency: Agency of Administration Public Service Department Federal Program: COVID-19 – Coronavirus Capital Projects Fund Assistance Listing Number: 21.029 Award Number and Year: CPFFN0202 (2/4/2022 – 12/31/2026) Compliance Requirement: Reporting – Performance Reports Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Recommendation: We recommend the Department and the Agency review their respective procedures and internal controls to ensure that Quarterly Performance Reports are accurate, are supported by documentation, and that supporting documentation is maintained and is readily available for audit. Views of responsible officials: Management agrees with the finding. Corrective Action Plan The Department of Public Service, the Department of Libraries, and the Department of Forests, Parks, and Recreation will hold a monthly coordination meeting to review program updates, monthly expenditures, reporting processes, and other matters. Notes will be sent out from the monthly meetings within 5 business days. The Department of Public Service will create a review process to be managed by the Financial Director IV. This process will ensure sign-off before reporting is certified and Treasury draws are performed. Scheduled Completion Date of Corrective Action Plan: Monthly Meeting Series Established – 04/15/2026 Full Review process in place – 7/31/2026 Contacts for Corrective Action Plan: Doug Farnham, Vermont State Recovery Office, douglas.farnham@vermont.gov Brittney Wilson, Department of Public Service, brittney.wilson@vermont.gov

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Finding 1182830 (2025-011)

Material Weakness 2025

State of Vermont

VT

Questioned Costs Procurement, Suspension & Debarment Subrecipient Monitoring § 200.303

Reference Number: 2025-011 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: National Infrastructure Investments Assistance Listing Number: 20.933 Award Number and Year: 69A36520401930BLDVT (8/1/2020 – 10/31/2026) CA0714 ...

Reference Number: 2025-011 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: National Infrastructure Investments Assistance Listing Number: 20.933 Award Number and Year: 69A36520401930BLDVT (8/1/2020 – 10/31/2026) CA0714 (4/29/2022 – 4/29/2032) CA0751 (5/1/2023 – 10/1/2028) CA0906 (1/24/2025 – 11/1/2030) Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend the Agency review its procedures and internal controls to ensure that subawards are reported timely and accurately to SAM.gov in no later than the end of the month following the month of issuance or modification. Views of responsible officials: Management agrees with the finding. Corrective Acton Plan: VTrans will update procedures to ensure compliance with the Federal Funding Accountability and Transparency Act (FFATA) reporting requirements. As part of this update, the Agency will review the current reporting workflow and clearly define roles, responsibilities, and timelines for FFATA reporting. The updated procedure will include guidance for identifying reportable sub-awards, collecting required data elements, and entering information into the appropriate federal reporting system within the required timeframe. Scheduled Completion Date of Corrective Action Plan: June 30, 2026 Contacts for Corrective Action Plan: Diane Bigglestone, Financial Director, diane.bigglestone@vermont.gov

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Finding 1182829 (2025-010)

Material Weakness 2025

State of Vermont

VT

Reporting § 200.303 § 200.502

Reference Number: 2025-010 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: National Infrastructure Investments Assistance Listing Number: 20.933 Award Number and Year: 69A36520401930BLDVT (8/1/2020 – 10/31/2026) CA0714 ...

Reference Number: 2025-010 Prior Year Finding: No Federal Agency: U.S. Department of Transportation State Agency: Agency of Transportation Federal Program: National Infrastructure Investments Assistance Listing Number: 20.933 Award Number and Year: 69A36520401930BLDVT (8/1/2020 – 10/31/2026) CA0714 (4/29/2022 – 4/29/2032) CA0751 (5/1/2023 – 10/1/2028) CA0906 (1/24/2025 – 11/1/2030) Compliance Requirement: Reporting – Schedule of Expenditure of Federal Awards Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Recommendation: We recommend the Agency review and enhance internal controls and procedures for payment processing and SEFA preparation to ensure that payments are properly coded in the accounting system and that expenditures are reported accurately on the SEFA. Views of responsible officials: Management agrees with the finding. Corrective Acton Plan: Rail Program Manager • Establish and maintain database with all federal grants and federal funding CFDA/ALN’s. • Coordinate between Budget & Business Support Services / Federal Programs and the Accounting Unit to establish EA’s. • Train all project managers on the collaboration and database management process for gathering and maintaining all required codes and information related to federal funding. • For FRA funded projects the Program or Project Manager will include the federal grant award document when submitting an EA setup request. Budget & Business Support Services / Federal Programs • Upon receipt of a new EA request from the RAIL Program or Project Manager, the Finance EA Setup resource (Patrick MacCormick) will complete the following steps to verify the ALN: o If an FHWA project:  Search the federal project in FMIS. If the federal project does not exist in FMIS,  Make a request to the Federal Programs Team to set up the federal project in FMIS. o All other projects:  Request the grant award from the Program or Project Manager. If the grant award has not yet been distributed,  Request the Notice of Funding Opportunity (NOFO) from Grants.gov or SAM.gov from the Program or Project Manager. o Review the EA setup request and the ALN identified in any one of the methods above to ensure the Assistance Listing Number (ALN) is consistent between both documents. o If a discrepancy is identified between the ALN listed on the EA request and one of the methods above, return the request to the Program or Project Manager for clarification before proceeding with setup. • Federal Program Quarterly FHWA Reporting o Generate a report of all active federal projects with associated ALNs listed in FMIS and AOT EAs.  The report shall pull in ALNs from the previous quarter’s report and flag any changes.  Send email to the Finance EA Setup resource and Accounting Unit containing the generated report. Accounting Unit: • The Accounting Unit will perform an audit of all FRA EA’s and ask the Rail Program Manager to verify. o Any incorrect or missing CFDA/ALN’s will be addressed in STARS. • Prior to year end, the Accounting Unit will contact the Rail Division again. o A list of the EA’s and expenditures with the CFDA/ALN’s from STARS for the year will be provided. o Rail will be asked to verify and certify that Accounting has captured the amounts in the correct CFDA/ALN’s. o Note: These processes have been put in place for the FY26 reporting cycle. (Per Diane Bigglestone) Scheduled Completion Date of Corrective Action Plan: April 1, 2026 Contacts for Corrective Action Plan: Diane Bigglestone, Financial Director, diane.bigglestone@vermont.gov Paul Libby, Senior Project Manager, paul.libby@vermont.gov Patrick MacCormack, Financial Director, patrick.maccormack@vermont.gov

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Finding 1182828 (2025-009)

Material Weakness 2025

State of Vermont

VT

Allowable Costs / Cost Principles Matching / Level of Effort / Earmarking Questioned Costs § 200.303 § 200.403

Reference Number: 2025-009 Prior Year Finding: 2024-009; 2023-007 and 2022-016 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: 25A55UI000119 (10/1/2024 – 12/31/2027) ...

Reference Number: 2025-009 Prior Year Finding: 2024-009; 2023-007 and 2022-016 Federal Agency: U.S. Department of Labor State Agency: Vermont Department of Labor Federal Program: Unemployment Insurance Assistance Listing Number: 17.225 Award Number and Period: 25A55UI000119 (10/1/2024 – 12/31/2027) UI370952155A50 (9/1/2021 – 5/22/2025) 23A60UB000019 (8/3/2023 – 5/22/2025) 24A60UD000052 (8/20/2024 – 8/20/2027) Compliance Requirement: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency in Internal Control over Compliance Recommendation: We recommend the Department review and enhance its procedures and controls regarding payment processing to ensure that, prior to charging costs to the program, they are reviewed by a supervisor who is knowledgeable of the regulations regarding allowable program costs and that documentation of the review is maintained. Views of responsible officials: Management agrees with the finding. Corrective Acton Plan: The Department has reviewed its procedures and internal controls, and we believe that they adequately require oversight and signoff of all expenditures to ensure that expenditures are adequately reviewed and signed off on. However, there is currently no double check to ensure that the accounting clerks are following these procedures. Department will be adding a secondary check to the procedure to occur at the end of each month to review expenditures for proper coding (cost center, project code and function code) as well as responsible party signoff. Scheduled Completion Date of Corrective Action Plan: May15, 2026 Contacts for Corrective Action Plan: Kristine Murphy, Director, Unemployment Insurance, kristine.murphy@vermont.gov Chad Wawrzyniak, Chief Financial Officer, chad.wawrzyniak@vermont.gov

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