Corrective Action Plans

Reporting - Cash Management During the testing of the Department's cash management procedures, it was determined that eight out of sixty payments tested were not distributed within 21 days of the draw down of funds. For the items tested, the time elapsed between draw down and payment ranged from 22 to 44 days. Corrective Action Plan:WIC has developed a Quality Control Plan, procedures and a workflow to ensure invoices are timely released to ASO-Fiscal for processing. Implementation Date: April 1, 2025 Responding Official: Melanie Murakami, WIC Branch Chief

2024-002 - LACK OF WRITTEN FISCAL POLICIES AND PROCEDURES As of March 27, 2025, scaleLIT has updated its fiscal policies and procedures to reflect all the federal guidelines required by the Uniform Guidance. The scaleLIT Board Treasurer has reviewed and approved the updates.

The University will move to have the funds placed into an interest bearing account. In addition, we will seek additional clarity from the program officer as it relates to the original guidance received and the steps to submitting interest to the appropriate agency.

We concur with the recommendation. The one (1) instance of drawdown that exceeded the three day rule for drawdowns was an oversight on the part fo the institution. In addition, we will revise the spreadsheet used to track cumulative program expenditures against drawdowns.

Finding Number: 2024-003, Subrecipient Payments Condition: The University did not have adequate controls in place to ensure invoices to subrecipients were paid timely within the 30-calendar-day requirement. Planned Corrective Action: Penn State has created a new Subaward Administration and Compliance Office (SACO), which is part of the new Post Award Contractual Compliance Office. The SACO is led by its own director and will provide central oversight over key subaward compliance processes, such as subrecipient payments, and provide training to campus on subrecipient processes. This function has previously not existed in a central office at Penn State. The creation of this office demonstrates Penn State’s commitment to compliance for subaward activities. Contact person responsible for corrective action: John Hanold, Associate Vice President for Research; Director, Office of Research Administrative Services Anticipated Completion Date: June 30, 2025

State and Local Fiscal Recovery Funds– Assistance Listing No. 21.027 Allowable Activities and Costs - Significant Deficiency in Internal Control Over Compliance Recommendation: We recommend the Commission establish policies and procedures over internal controls to ensure review and approval of SEFA preparation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Commission will implement a SEFA preparation policy. Name of the contact person responsible for corrective action: Tracie Thomas Planned completion date for corrective action plan: May 31, 2025

Finding 2024-006: Return of Interest Earned on Advance Payment Cash Receipts Grantor: Department of Health and Human Services (“DHHS”) Program Title: Hospital Preparedness Program (HPP) Ebola Preparedness and Response Activities Award Name: Region 3 Emerging Special Pathogen Treatment Center at The Johns Hopkins Hospital (JH Biocontainment Unit) Award Number: U3REP220674 Assistance Listing Title: Hospital Preparedness Program (HPP) Ebola Preparedness and Response Activities Assistance Listing Number: 93.817 Award Year: September 30, 2023 – September 29, 2024 Passthrough Entity: None Management agrees with the finding and recommendation. Management notes that advancing the funds at the start of the year and returning any unspent funds was only used in the first year of the grant being directly awarded to JHH in fiscal year 2024. Management performed the analysis of any interest earned on the unspent balance of the advance payment and returned the interest earned on March 25, 2025. Management further notes that starting in year two of the grant the funds are not advanced and will be requested through a drawdown as expenditures are incurred. Management will implement a process to calculate interest earned annually and return funds exceeding $500 for any future awards under the advance payment method. Management has remediated this finding.

Condition: The District's expenditure reports filed for June 30, 2024 included expenditures in the amount of $19,645 paid in July 2024. These amounts were not reported as committed or obligated. Plan: Grant expenditure reports will be prepared on the cash basis and obligations reported. The liquidation of the obligations will be reported on subsequent expenditure reports. Management Response: There is no disagreement with this finding, and management will monitor all future federal reimbursement requests. Committed and obligated expenditure reports will be reported appropriately, and will be paid within 90 days after project completion.

CORRECTIVE ACTION PLAN State Fiscal Year Ended June 30, 2024 93.568 Low-Income Home Energy Assistance State Agency: Department of Energy Audit Contact: Leonard Rautio Title: Chief of Operations Telephone: (603) 271-6008 E-mail address: leonard.j.rautio1@energy.nh.gov Audit Report Reference: 2024-023, 2023-014, 2022-027 – Cash Management Anticipated Completion Date: June 30, 2025 Corrective Action Planned: Concur The Department has eliminated giving program advances for program year 2025 (PY25) and reduced the amount of the administrative advances from 17.5% to 10% for PY25. The Department monitors monthly bank statements from the subrecipients to ensure there is little or no interest accrued from cash on hand. 2 CFR 200.305 (b)(1) does not limit cash on hand to 30 days but indicates that the timing and amount of advance payments must be as close as is administratively feasible to the actual disbursements by the subrecipient. Federal guidance to the Department indicates the Department is meeting that requirement. However, the Department will continue to review administrative advances and adjust the amounts to ensure subrecipient cash on hand is limited to a reasonable timeframe.

The University has policies and procedures to ensure the review of expenditures charged to federal grants prior to draw downs. However, the University failed to identify a mistake in a journal entry which resulted in a duplicate expense posting to the grant until after the draw down request had been made. Specifically, the University charged prepaid amortization to a grant fund, although the expenditure had already been fully recorded to the grant fund. This resulted in a duplicated expense posting, one for the actual payment of the expenditure, and a second for the expense amortization. The University discovered the mistake after the duplicated expense had been drawn down. To correct this error, the University initiated the process to reduce a subsequent draw for the grant to ensure that overall, the grant is not overdrawn. Management reviewed the conditions which contributed to this error and is establishing the following controls to address this error: 1. The University will incorporate an additional review step for any journal entries posted to federal grants. The Office of Sponsored Projects and Business Office management will sign off on any journal entries which are posted to federal grants prior to the posting taking place. 2. The Business Office will reinforce existing procedures to all accounting staff responsible for prepaid expense accounting to ensure that prepaid expense is not recorded to federal grant funds. 3. The Office of Sponsored Projects will adjust its review process and train staff to ensure thorough review of all activities impacting grants, including journal entries made by the Business Office, before authorizing drawdowns. Person(s) Responsible: Assistant Vice President of the Office of Sponsored Projects. Controller & Associate Vice President. Targeted Correction Date: June 30, 2025.

Planned Corrective Action: To complywith federal cash management requirements, Research and Sponsored Programs (RSP) will develop a responsive cash management policy and procedures to implement the policy for subrecipient agreements. The policy and subsequent procedure will specify the circumstance and requisites a cash advance may be suitable. A standard cost reimbursable agreement will be otherwise executed. RSP will evaluate subrecipientsthat request agreements with advance paymentto determine whetherto issue an agreement with advance payment. Thisincludes determining whetherthe Subrecipient has a need for an advance payment as well asthe amount of advance payment needed. Forsubrecipientsthat RSP determinesto issue a subagreement with an advance payment, RSPwill issue agreementsthatincorporate 2 CFR 200.305(b)(1)(2)- federal payment requirements and include, as applicable, interest-bearing accountrequirements. RSP staffwill be trained on the new procedures and additionsto subrecipient agreements. Anticipated Completion Date: October 30, 2025 Person responsible for corrective action: Angie Johnson, Assistant Director of Research Financial Services Research and Sponsored Programs Angie.johnson@rsp.wisc.edu

Management concurs. The City will implement policies and procedures at the appropriate level of management in reviewing cash drawdown requests. Once completed, reconciliations will be reviewed and approved by someone other than the preparer to ensure that errors and or/adjustments are identified and corrected in a timely manner.

Department: Health and Human Services Title: Internal control over TANF program subrecipient cash management needs improvement Questioned Costs: None Status: Management’s opinion is that corrective action is not required Corrective Action: The Department disagrees with this finding. The Department is in compliance with the requirement for minimizing the time between payments to our subrecipients and the disbursement of funds. Payments are made as close as administratively feasible. The Compliance Supplement suggested audit procedures for Cash Management for pass-through entities refers to 200.305(b)(1). That same paragraph states that the timing and amount of advance payments must be as close as is administratively feasible. Completion Date: N/A Agency Contact: Anthony Madden, Deputy Director of Audit, DHHS, 207-287-2834

Department: Health and Human Services Title: Internal control over ICA program subrecipient cash management needs improvement Questioned Costs: None Status: Management’s opinion is that corrective action is not required Corrective Action: The Department disagrees with this finding. The Department is in compliance with the requirement for minimizing the time between payments to our subrecipients and the disbursement of funds. Payments are made as close as administratively feasible. The Compliance Supplement suggested audit procedures for Cash Management for pass-through entities refers to 200.305(b)(1. That same paragraph states that the timing and amount of advance payments must be as close as is administratively feasible. Completion Date: N/A Agency Contact: Anthony Madden, Deputy Director of Audit, DHHS, 207-287-2834

Department: Health and Human Services Title: Internal control over CSLFRF subrecipient cash management needs improvement Questioned Costs: None Status: Management’s opinion is that corrective action is not required Corrective Action: The Department disagrees with this finding. The Department is in compliance with the requirement for minimizing the time between payments to our subrecipients and the disbursement of funds. Payments are made as close as administratively feasible. The Compliance Supplement suggested audit procedures for Cash Management for pass-through entities refers to 200.305(b)(1). That same paragraph states that the timing and amount of advance payments must be as close as is administratively feasible. Completion Date: N/A Agency Contact: Anthony Madden, Deputy Director of Audit, DHHS, 207-287-2834

Department: Health and Human Services Title: Internal control over WIC subrecipient cash management needs improvement Questioned Costs: None Status: Management’s opinion is that corrective action is not required Corrective Action: The Department disagrees with this finding. The Department is in compliance with the requirement for minimizing the time between payments to our subrecipients and the disbursement of the funds. Payments are made as close as administratively feasible. The Compliance Supplement suggested audit procedures for Cash Management for pass-through entities refers to 200.305(b)(1). That same paragraph states that the timing and amount of advance payments must be as close as is administratively feasible. Completion Date: N/A Agency Contact: Anthony Madden, Deputy Director of Audit, DHHS, 207-287-2834

Federal Programs ALN: 93.575, 93.596, 93.558, and 93.667 Criteria: The Organization is required to remit all interest earned on federally funded advances to DEL within 30 days after the fiscal year end per DEL Program Guidance 240.01 Cash Management and 2 CFR 200.305(9). Condition: The Organization failed to remit all earned interest to DEL within the 31 day deadline in accordance with the grant agreement. Cause: The Organization experienced high management turnover which delayed the calculation of interest earned and remittance to DEL. Effect: The Organization did not meet the remittance submission deadline requirement as set forth by DEL Program Guidance 240.01 Cash Management and 2 CFR 200.305(9). The earned interest was remitted on March 11, 2025. Recommendation: We recommend the Organization designate an individual to calculate interest earned and closely monitor the submission deadline. Corrective Action Plan: Coalition management will make sure that measures are in place to ensure all interest earned is reconciled monthly and paid timely back to DEL. Responsible Party: Xaviera White, Chief Executive Officer Anticipated Completion Date: March 2025

March 24, 2025 In response to the finding, he Town hired a consultant to manage the High St Dam Project that was sourced with multiple grants. In FY2024, the Town was faced with a staffing shortage, and it did not properly oversee the reimbursement schedules. The Town anticipates this project to close out during the next fiscal year, and with new staff in place, it will properly manage and oversee all of the grant reporting and reimbursements. Sincerely yours, Laurie Guerrini, Finance Director

Program: AL 12.401 – National Guard Military Operations and Maintenance (O&M) Projects – Cash Management & Reporting Corrective Action Plan: The Agency is meeting with State Budget Office to discuss and review options for better separating future federal funding by fiscal year. This will allow for better tracking and transparency of drawdown times. Further, the Agency is aware of the finding for Award W91243-22-2-1001 (SAG 132) and currently reconciling all line items in the Award Program and year to determine and action on return of appropriate federal funding. Contact: Lauren Hargreaves Anticipated Completion Date: Ongoing

Recommendation – Auditors management to monitor and evaluate the performance of their accounting staff and to make improvements to prevent and/or detect noncompliance when necessary. Additionally, the Center should provide training to all personnel involved in accounting for federal awards. Action Taken – The Center hired and filled a key financial position subsequent to the year end. Management believes a lack of permanent staff a significant factor in causing this finding. The Center has established proper accounting procedures and controls, and with the key postion being filled, federal draw downs will be perfomed according the Center's policy.

Condition: There was no evidence of a system of internal control over the cash management requirements, including a written policy related to reimbursement of funds on a per-refugee basis. In addition, it was noted that reimbursement was requested prior to incurring expenses on a per-refugee basis. There were also refugee costs coded incorrectly within the general ledger. Planned Corrective Action: Financial policies will be updated to include cash management requirements to ensure expenditures are incurred, including any required per client expenditures, prior to reimbursement requests. Subsequent to year end a new process was put in place to compare the individual refugee ledgers to the reimbursement request to ensure no expenditures were requested in advance and that individual refugee costs were coded to the correct general ledger account. Contact person responsible for corrective action: Linda P. Foster, CEO Anticipated Completion Date: Refugee ledger reconciliation process completed 2/1/2025 Policy approval and implementation to be completed by 5/1/2025

Finding 2024-002 Cash Management – Timeliness of Subrecipient Payments Plan: UIC - The University of Illinois Chicago will provide additional training and guidance to research administrators on the requirement of timely payments to subrecipients. UIUC – Sponsored Program Administration continues the development of a subaward invoice automation platform to create and capture efficiencies toward the 30-day payment requirement. In tandem, there is continual review of strategies to address the current manual, multi-layered approval and payment process. Expected Implementation Date: UIC - March 2025 UIUC - December 2025 Contact: Katrina Lopez, Assistant Director Office of Sponsored Programs (OSP) University of Illinois Chicago klopez3@uic.edu 312-996-3782 Karen Thomas, Director Post-award Sponsored Program Administration University of Illinois Urbana-Champaign Kthomas2@illinois.edu 217-265-4096

Corrective Actions Taken Commons has taken the following actions to protect against such fraudulent incidents in the future: • Engaged a firm to assist with managing the incident; • Opened a new bank account; • Added account verification services with our banking partner, which will be utilized to verify account updates; • Limited the amount of per vendor/subrecipient daily payments to our insurance limits, with verifications prior to releasing additional funds when the total payment exceeds the insurance limits; • Subrecipient payment receipt is verified by both the subrecipient and the Commons grants team; • Updated our policy and procedures to direct our subrecipients to request banking changes through our procurement system and not through email; and • Expanded implementation of our Kissflow procurement system across the organization, which includes new vendor process as well as a change of vendor information module. Vendor changes would be approved first by the program/department that works with the vendor prior to Finance approval. Completion Date With the exception of implementing the change of vendor information module in Kissflow, the above actions have all been completed by the date of this report. The projected completion date for Kissflow change of vendor information module is April 30, 2025. Responsible Party Dana Thomas, Chief Financial Officer Angela Allen, Vice President of Finance

Action 1: Ensure that cash drawdowns occur within a few days of disbursement as the standard of “minimizing the time elapsing between draw down of funds and disbursement for program purposes.” Action 2: Ensure that the Chief Financial Officer, Director of Accounting & Budgeting, and the HSI Grant Administrator complete the Post-Award Training available from Ed.gov. Action 3: Establish a policy that month end, quarterly, and year end balances in the HSI account are at or near $0.

Contact Person Responsible for Corrective Action: Abigail Lindsey Contact Phone Number: 765-853-5464 Context: The School Corporation pays one hundred percent of its Special Education Cluster funding to one service provider, which totaled $3,782,381 for the audit period. For all invoices during the audit period, the School Corporation submitted and received reimbursement from the IDOE prior to paying the service provider, and then the School Corporation remitted payment to the service provider. There was significant delay in the time between the School Corporation was reimbursed by IDOE and when the School Corporation paid the service provider. The delay in payment was in the range of 2 – 4 months for the payments made during the audit period. Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Corporation will pay Special Ed invoice to INDLS within the same week as receiving the reimbursement. Anticipated Completion Date: 05/01/2025