Corrective Action Plans

Finding Reference Number: SA 2022-006 Equipment Management AL Number: 14.218 Assistance Listing Title: CDBG - Entitlement Grants Cluster – Community Development Block Grants/Entitlement Grants COVID-19 - Community Development Block Grants/Entitlement Grants-CV Federal Agency: Department of Housing and Urban Development Federal Award Identification Number: B-14-MC-06-0037, B-15-MC-06-0037, B-16-MC-06-0037, B-17-MC-06-0037, B-18-MC-06-0037, B-19-MC-06-0037, B-20-MC-06-0037, B-20-MW-06-0037, B-21-MC-06-0037 • Fiscal Year of Initial Finding: 2022 • Name(s) of the contact person: Jennifer Block, Management Analyst Kiranjeet Sanghera, Finance Manager • Corrective Action Plan: The City will update its capital assets records to specify funding source. Procedures will be developed to meet physical inventory requirements. • Anticipated Completion Date: October 2025

Individual(s) Responsible: Chelsea BadHawk, Chief Financial Officer Action: Management will prepare and implement an internal control system that provides effective oversight of operations, reporting, and compliance. The systems and controls will be designed based on standards set forth in the Government Accountability Office Green Book. Anticipated Completion Date: 12/31/2025.

FINDING 2022-002 Information on federal program: Subject: Water and Waste Disposal Systems for Rural Communities - Equipment and Real Property Management Federal Agency: U.S. Department of Agriculture Assistance Listing Number: 10.760 Federal Award Number: 92-02 92-03 Pass-Through Entity: NIA Compliance Requirements: Equipment and Real Property Management Audit Findings: Significant Deficiency Condition: An effective internal control system was not in place at the City to ensure compliance with requirements related to the grant agreement and the Equipment and Real Property Management compliance requirement. Context: The City did not maintain an updated asset listing that reflects the construction in process balance related to the project funded with federal funds. Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Management will ensure that the capital asset listing is maintained throughout the year and CIP is tracked. Responsible Party and Timeline for Completion: The Clerk-Treasurer is the responsible party. The completion will go into effect during 2025.

RECOMMENDATION: Create a property management system and adopted written policies and procedures. These procedures should be reviewed and updated to, at a minimum, adhere to the newest federal guidelines under OMB Uniform Guidance. Physical inventories should be performed periodically and reconciled to the property management records. Property management records should also include copies of the original asset purchase documentation. Action Taken: The School agrees with this finding and will implement this recommendation within 120 days of this audit report.

January 31, 2025 To Whom it May Concern: The City of Harrisburg, Pennsylvania respectfully submits the following summarized corrective action plan for the Fiscal year ending December 31, 2022. The Audit Report was prepared by Boyer & Ritter LLC, Certified Public Accountants and Consultants, 211 House Avenue Camp Hill, PA 17011. Related findings are described in detail as contained within the City’s Single Audit Report, schedule of findings and questioned costs, and such are numbered in the corrective action plan in accordance with that assigned in the schedule. Any questions regarding this plan can be directed to Bryan McCutcheon, Accounting Manager at bmccutcheon@harrisburgpa.gov. Bryan McCutcheon, Accounting Manager City of Harrisburg Building and Housing Development Director of Housing and Economic Development, and Accounting Manager By or before 12/31/20025 Expenditures of CDBG grant funding for capital outlays on equipment and real property are readily identifiable within the City’s fixed assets module of the accounting system, including subsequent retirements of any such capital assets. The Department acknowledges related physical inventory observations to identify these assets have not been consistently performed and will work to formalize such inventory procedures. The City will look to complete such process as soon as is feasibly possible.

2022 – 009: Activities Allowed and Unallowed, Allowable Costs, Period of Availability (Compliance; Internal Controls Over Compliance) (Repeat Finding: 2018-006, 2019-008, 2020-008 and 2021-007) Significant Deficiency ALN 93.441 Indian Self Determination ALN 20.205 Highway Planning & Construction ALN 15.030 Indian Law Enforcement ALN 93.575 Child Care and Development Block Grant ALN 21.027 Coronavirus State and Local Fiscal Recovery Funds (ARPA) Condition: During compliance requirement testing for Activities Allowed and Unallowed, Allowable Costs and Period of Performance for the above noted major programs, we selected 120 transactions for testing from each major program. The following number of transactions were not provided for our review during the audit: ALN 93.441 – Indian Self Determination – 47 transactions ALN 20.205 – Highway Planning and Construction - 11 transactions ALN 15.030 – Indian Law Enforcement – 8 transactions ALN 93.575 – Child Care and Development Block Grant – 22 transactions ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds – 9 transactions Corrective Action Plan: The Finance Department will become familiar with the requirements of 2 CFR, Part §200.313(a) and establish appropriate internal control policies and procedures to ensure compliance with the requirements of Uniform Guidance and each major program. In addition, all staff will be trained on those policies and procedures so they are familiar with the requirements. The Finance Department will not process payment for disbursements that does not contain sufficient, appropriate supporting documentation and necessary approvals. The Finance Department will implement and execute an internal audit, by pulling random vouchers packets to test for compliance mid-year.

Views of Responsible Officials The Organization agrees with this finding. Corrective Action Plan The Organization will update its property records to include all required information. Additionally, the Organization plans to complete a physical inventory count and related reconciliation on an annual basis. Name(s) of Responsible Individuals Lacy Kimes, Board President Anticipated Completion Date October 31, 2024

Management will assign personnel responsible for the monitoring of all Federal funded equipments and establish internal control policies and procedures to perform the required physical inventory and reconciliation of all equipment and real properties acquired from Federal funds at least every year.

Procedures and policies surrounding equipment and real property management, physical inventory and data retention are being reviewed and updated to ensure requirements under Uniform Guidance are met.

We are currently working on a project to integrate the accounting system in the warehouse and Receiving module with the property module that will significantly improve the accuracy of asset management. With this action we will establish a communication protocol between these systems and ensures that equipment and property are meticulously tracked and reconciled. This seamless integration will not only streamline the recording process, but also provide a reliable method for maintaining the integrity of the general ledger. We expect to have this integration by the end of 2024.

Finding 2022-013 Equipment and Real Property Management - Noncompliance and Significant Deficiency in Internal Control Over Compliance Corrective Action Plan: Management agrees with this finding and will work to achieve compliance with the requirements outlined in 2 CRF Sections 200.313. Specifically, Management will enhance controls over the review and disposal of equipment and real property and enhance supervisory reviews over this accounting function. Anticipated Completion Date: December 31, 2024

Finding 2022-012 Equipment and Real Property Management - Noncompliance and Significant Deficiency in Internal Control Over Compliance Corrective Action Plan: Management agrees with this finding and will strive to create and to maintain a complete and accurate equipment and real property listing. Further, staff will perform regular reconciliations for the equipment and real property listing to ensure that its accuracy is maintained. Anticipated Completion Date: December 31, 2024

Finding 2022-011 Equipment and Real Property Management - Material Noncompliance and Material Weakness in Internal Controls Over Compliance Corrective Action Plan: Management agrees with this finding and will strive to create and to maintain a complete and accurate equipment and real property listing. Further, staff will perform regular reconciliations for the equipment and real property listing to ensure that its accuracy is maintained. Anticipated Completion Date: December 31, 2024

District subsequently sought and obtained CDE approval for the expenditures identified in finding 2022-003.District has initiated a procedure where any requisitions for purchases utilizing Federal funds are routed through the Director of state and federal programs prior to being approved. The director of state and federal programs, prior to approving the purchase requisition, will obtain approval from the CDE. All contracts utilizing federal funds will include language related to Federal wage rate requirements. The supervisor of Purchasing will be tasked with ensuring the contract language is present in agreements for services utilizing Federal funds.

The University has reviewed and enhanced its procedures and internal controls surrounding physical inventory of equipment and real property acquired with federal funds to ensure the physical inventory is performed at least biennially to meet the two-year requirement.

FINDING 2022-003Contact Person Responsible for Corrective Action: John Kenny and William LutherContact Phone Number: (812) 330-7700Views of Responsible Official: We concur with this finding. This finding has been remediated as of the completion dateshown below.Description of Corrective Action Plan:The asset mentioned in the finding now includes the source of funding. All future capital assets purchased with EducationStabilization Funds will include the source of the funding on the capital asset listing. The MCCSC will perform a physicalinventory during the current audit period.Completion Date: March 22, 2023

FINDING 2022-009Subject: COVID -19 - Education Stabilization Funding - Equipment and Real PropertyManagementFederal Agency: Department of EducationFederal Program: Education Stabilization FundAssistance Listings Numbers: 84.425DFederal Award Number and Year (or Other Identifying Number): S425D210013Pass-Through Entity: Indiana Department of EducationCompliance Requirement: Equipment and Real Property ManagementAudit Findings: Material Weakness, Modified OpinionContact Person Responsible for Corrective Action: Chad Yencer, SuperintendentContact Phone Number: 765-348-7550Views of Responsible Official: We concur with this findingDescription of Corrective Action Plan:Each building principal shall maintain an up-to-date inventory on prescribed forms orelectronic format supplied by the business office. Each teacher shall maintain an up-to-dateinventory of equipment and supplies in his/her shop, laboratory, or classroom. The teachershall submit a complete inventory on the prescribed form (paper or electronic) to the buildingprincipal prior to the teacher?s leaving at the end of the school year. The building principal shallcertify to the business office that the inventory has been checked and approved. There shall betwo copies of the inventory: one filed with the building principal and one filed with the businessoffice, or an electronic copy and a paper copy.An equipment inventory will be maintained on all computers and capital outlay items exceeding$1000.00 in value. The inventory will serve the functions of both control and conservation.The technology coordinator shall be responsible for assuring the maintenance of acomprehensive inventory of administrative and instructional computer hardware and software.The coordinator should work with the corporation technology department to developprocedures to be followed in maintaining such an inventory.The librarian for each building shall be responsible for keeping a complete inventory of allaudio-visual items in his/her building and providing the inventory information to the buildingprincipal, or by using electronic entry.INDIANA STATE BOARD OF ACCOUNTS50The running inventory shall be maintained on 1) building and grounds equipment; 2) furniture;3) administrative equipment; 4) educational equipment; 5) vehicles; and 6) textbooks andsupplementary books.The maintenance supervisor and business manager shall be responsible for inventories relativeto buildings and grounds equipment and vehicles. The building principal and business managershall be responsible for the inventories relative to furniture, administrative equipment,educational equipment, and textbooks and supplementary books.The superintendent will ensure that the capital asset inventory records will be updated uponreceipt of equipment, and that the proper identification and records will be maintained. BCS willengage Ad-Tech as well to annually perform an audit of assets and update the inventory recordsand necessary property records.Anticipated Completion Date: July 2023

Management?s View and Corrective Action PlanThe following is Novant Health?s response to the audit of Federal programs in accordance with the Uniform Guidance for year ending December 31, 2022.2022-003: Evidence of physical inspection of equipment purchased with federal funds was not maintained ? Significant deficiencyCluster: Not applicableFederal Granting Agency: Health Resources and Services Administration (?HRSA?)Award Name: COVID-19 National Bioterrorism Hospital Preparedness Program (?Bioterrorism Program?)Award #: N/AAssistance Listing #: 93.889Award Year: Fiscal year 2022Pass-through entity: North Carolina Healthcare Foundation; North Carolina Department of Health and Human Services ? Division of Health Service Regulation, Office of Emergency Medical ServicesPass-through award #: U3REP 200659; 42705; 44024Management understands the importance of inspection and maintenance of equipment purchased utilizing funding under this grant, as well as the requirement of a physical inventory and reconciliation to property records at least bi-annually. Novant Health receives a notification of award and contract from the North Carolina Office of Emergency Medical Services (NCOEMS), Healthcare Preparedness Program (HPP) that outlines a summary of the financial information, specific grant terms, scope of work, and inventory management requirements.Corrective Action Plan and Anticipated Completion DateNovant Health management?s corrective action plan includes:? Update internal inventory management system, iCams, with needed information required to meet applicable Federal requirements? Create a formal process to update the maintenance and inventory of assets that meet this requirement that can be appropriately carried out by both paid and volunteer staff.? Complete a full inventory of all equipment purchased with federal fundsNovant Health will determine and implement a best practice to properly capture the necessary information to meet the applicable Federal requirements by October 31, 2023. We will also have the inventory management system updated by March 31, 2024, with maintenance and inspection dates required for hard supplies and equipment purchased under this grant to meet applicable Federal requirements, as well as a full inventory of federally-funded equipment, completed on a rolling basis moving forward, by June 30, 2024.Additionally, the program manager will provide an email confirming completion of the above steps to the Grants Director and team.For follow-up questions and information, please contact Randy Brantley, Novant Health Grants Director at rlbrantley@novanthealth.org.Sincerely,Randy BrantleyGrants Directorrlbrantley@novanthealth.org

FINDING 2022-006Contact Person Responsible for Corrective Action: Robin PopejoyContact Phone Number: 317.758.4172Views of Responsible Official: We concur with the finding.Description of Corrective Action Plan: Those procedures and errors were discussed and adjustment will be made. TheDirector of Business will conduct and internal audit of capital assets records. New staff will also be trained on trackingcapital assets transitions and completing the necessary documentation for future capital assets transaction. There is aconstruction project that will result in capital assets being added.Anticipated Completion Date: June 2023

2022-003 Federal Agency: U.S. Department of EducationPass Thru Entity: Oklahoma State Department of EducationCOVID-19 Education Stabilization Fund-Elementary & Secondary School Emergency Relief (ESSER II & American Rescue Plan (ARP) Elementary & Secondary School Emergency Relief (ESSER III) FundAssistance Listing: COVID-19 84.425D & 84.425U (OCAS Projects 793 & 795)Recommendation: The Auditor recommended that all property purchased with federal funds be tracked as required by federal regulations. The Auditor also recommended that controls be implemented to properly maintain records for property obtained with federal funds.Action Taken: All federal inventories have been reviewed and updated as necessary with with additional information to bring the district into compliance. An additional control has been added at the end of the fiscal year to ensure all federal purchases have been identified and recorded on inventories.Anticipated Completion Date: October 6, 2022Responsible Official: Brandi Naylor

Corrective Action PlanYear Ended June 30, 2022Finding 2022-002: EquipmentCondition Found:The University did not complete its physical inventory counts for 10 departments out of the 15 sampled University departments. The University has a total of 70 departments monitoring federal equipment. In addition, for one item in our sample of 40 physical inspections, we noted the property was not appropriately tagged for identification.Recommendation:The auditors recommend the University enhance its internal control over compliance around establishing property records of newly acquired federally funded equipment in accordance with applicable Federal regulations and completing the necessary physical inventories and reconciliations.University of Delaware Corrective Action Plan:The University agrees with the finding and will strengthen processes including unit and senior leadership accountability around the tagging and surveying of federally funded equipment. The University will implement management and escalation procedures with executive leadership to ensure that accountability for all completed surveys resides with the senior leader. The entire process is being evaluated and controls will be enhanced where needed and training will be expanded to include the importance of timely compliance.Anticipated Completion Date:June 2023Contact Person:Lisa Marra Kelly, Controller, Controller?s Office

Name of Contact Person: Sue Nickerson, Town Accountant

Corrective Action Plan: The District will review current policies and procedures relating to the purchasing and maintaining of equipment and real property, in particular, when purchasing with Federal funds. Currently, the District does maintain a record of all purchases, including Federally funded equipment. Moving forward, the records will be maintained in accordance with the Requirements for Equipment and Real Property Management from the 2023 Compliance Supplement. It should be noted that the Town/School financial system will be converting/upgrading to MUNIS ERP Solution for the Public Sector. MUNIS has a much more robust and sophisticated Fixed Asset module and will be invaluable for the District to meet this requirement.

Proposed Completion Date: Immediately

Auditor's Recommendation: We recommend the Entity enhance the design of its control activities and policies and procedures should be developed to ensure physical inventories are taken at least once every two years. Action Taken: The Organization understands the importance of regular physical inventories and will implement this control activity for the June 30, 2023 fiscal year end. Responsible Person: John Clemons, Chief Financial Officer Timeline for Implementation: July 31, 2023