Corrective Action Plans

Item 2021.007 – Period of Performance Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and falls within the period of performance. • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that is within the grant period. • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system. • Conduct regular reviews of expenditures to ensure compliance with the grant period and maintain audit trail. • Review these procedures annually to ensure ongoing compliance with the grant’s period of performance.

Item 2021.007 – Period of Performance Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding Yes Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and falls within the period of performance. • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that is within the grant period. • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system. • Conduct regular reviews of expenditures to ensure compliance with the grant period and maintain audit trail. • Review these procedures annually to ensure ongoing compliance with the grant’s period of performance.

Name of the Contact Person Responsible for the Corrective Action Plan: Gia Scruggs, City Manager Corrective Action Plan: The private contractor engaged in 2017 to provide government management and operations services staffed the engagement with less than 40 staff including 5 consultants. The City, since the termination of the services contract effective December 31, 2021, has 79 staff involved in City management and operations roles including 5 elected officials. The additional staff, including an additional 5 in accounting/finance, affords the City the capacity to effectively account for and report on restricted funds received in connection with state and federal grant programs. The City Manager staff has grown by an additional 3 staff persons from the contractor level that was assigned in 2021 to monitor grants providing sufficient City staff for current grant programs to be monitored and grant conditions complied with. As the City continues to be eligible for additional state and federal grants, a Grants Administrator position has been added to staff organization and the plan is to organize a grants management team devoted to reporting and compliance assurance as well as seeking to apply for state and federal grant and program funds. Anticipated Completion Date: City Finance Department staff, together with the City Manager, are presently monitoring compliance and reporting relating to state and federal grants and program support. Third-party contractors will no longer be used for these tasks, and as more restricted funds are received by the City, the grants management team will be organized. Presently, the City has only one federal grant program and one state program. The corrective actions have been implemented and are presently operative and in place

Invoices that are received will be scanned to “invoices”. This will direct them to our electronic software, Docuware. The item will then be forwarded to the appropriate Program Director for approval, and they will indicate the appropriate cost centers / allocations. Bookers will then review the approved coding and entered fiscal software. If there is a question or concern about approved coding by the bookkeeper they will speak with Director of Finance, Ethan Terrio. Once invoices are entered into fiscal software, checks will be printed. The check stub and invoice will be attached to each other and filed in the fiscal department.Paper documents will continue to be maintained in fiscal until we go 100% paperless, then all documents will be stored in Docuware.

Corrective action has been immediately implemented in response to the auditors' recommendation. As financial reporting is still in process of getting to current, the City anticipates findings to be reduced in future fiscal years.

We concur with this finding and have implemented measures to mitigate the repetition or additional occurrences. We mplemented an electronic system to more efficiently collect and store expenditures and supporting documentation, eliminating a paper filing system. We updated our fiscal policies and procedures in 2022 to document a standardized process for documenting expenditures and retaining receipts. For instance, invoices cannot be processed without adequate documentation. Additionally, credit card holders are responsible for submitting electronic credit card receipts to the fiscal office monthly. In 2022, an updated credit card policy was provided to all employees. The adherence to the credit card policy is monitored by the Fiscal Office and CEO. Responsible person(s): Jemea Dorsey, CEO and Jeanetta Johnson, Fiscal Manager Anticipated Completion Date: FY 2022

Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding No Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and fall within the period of performance • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that it is within the grant period • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system • Conduct regular review of expenditures to ensure compliance with the grant period and maintain audit trail • Review these procedures annually to ensure the ongoing compliance with the grant’s period of performance

Recommendation The Center should develop written procedures to review all expenditures to ensure they are within the proper period of performance of the grant. Repeat Finding No Action Taken Island Health Care will take the following actions to address this recommendation: • Conduct a pre-approval of expenditures, verifying that the expense is allowable under the grant terms and fall within the period of performance • Utilize a pre-approval form that includes details of the proposed expenditure, its necessity, and confirmation in the form of authorized signatures, that it is within the grant period • Require all relevant supporting documentation with the date the expense was incurred, ensuring it falls within the grant’s period of performance. This is further reviewed by the CFO who will verify that the expenditure meets all requirements and is then able to record it in the accounting system • Conduct regular review of expenditures to ensure compliance with the grant period and maintain audit trail • Review these procedures annually to ensure the ongoing compliance with the grant’s period of performance

We concur with this finding and have implemented measures to mitigate the repetition or additional occurrences. In 2020, we implemented an electronic system to more efficiently collect and store expenditures and supporting documentation, eliminating a paper filing system. We updated our fiscal policies and procedures in 2022 to document a standardized process for documenting expenditures and retaining receipts. For instance, invoices cannot be processed without adequate documentation. Additionally, credit card holders are responsible for submitting electronic credit card receipts to the fiscal office monthly. In 2022, an updated credit card policy was provided to all employees. The adherence to the credit card policy is monitored by the Fiscal Office and CEO. Responsible person(s): Jemea Dorsey, CEO and Jeanetta Johnson, Fiscal Manager Anticipated Completion Date: FY 2022