Corrective Action Plans

FINDING 2023-005 Information on the federal program: Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Program: Special Education Grants to States, Special Education Preschool Grants Assistance Listing Numbers: 84.027, 84.027X, 84.173, 84.173X Federal Award Numbers and Years (Or Other Identifying Number): 19611-067-PN01, 20611-070-PN01, 21611-070-PN01, 22611-02-CEIS, 22611-070-PN01, 22611-070-ARP, 23611-067-PN01, 21619-070-PN01, 22619-070-ARP, 22619-070-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Finding: Material Weakness, Qualified Opinion Condition: An effective internal control system was not in place at the School Corporation to ensure compliance with requirements related to the grant agreements and Procurement and Suspension and Debarment compliance requirements. Context: Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $50,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2022, the School Corporation had one vendor, with disbursements totaling $199,713 for the fiscal year, which exceeds the simplified acquisition threshold of $150,000. The School Corporation did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2022, three vendors, totaling $228,079, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $50,000 micro-purchase threshold. One of the three vendors was selected for testing. The School Corporation did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2023, one vendor, totaling $65,861, was identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $50,000 micro-purchase threshold and was selected for testing. The School Corporation did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. “Covered transactions” include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. During the audit period, there were six vendors identified which exceeded $25,000 in disbursements on an annual basis. Two vendors were selected for testing. In both instances, the School Corporation’s contract with the vendor did not include any suspension and debarment clause and the School Corporation did not verify the vendor’s suspension and debarment status prior to payment. The lack of internal controls and noncompliance was systemic issues throughout the audit period. Views of Responsible Officials and Corrective Action Plan: Management agrees with the finding. Specifically, regarding Suspension and Debarment, for contracts over $25,000, MSD of Pike Township will obtain a Certification or include a Suspension and Debarment clause in the contract. Absent Certification, the Director of Grants will review for “Suspension and debarment” and maintain documentation. The Special Education Department will work with the Grant Manager and will review contracts over $50,000 to follow the appropriate procurement policy to obtain quotes. Where specialized services are being solicited, we will maintain a procurement file memo documenting the process and the reasons for vendor selection. Responsible Party and Timeline for Completion: Greg A. Foster, Chief Financial Officer, will oversee the corrective action plan. Plan will be implemented by June 30, 2024.

1. Person responsible: Director, Department of Public Health 2. Corrective action plan: DPH agrees with this finding and recommendation and will discuss, and document sensitive legal matters funded by federal funds with respective grantors to obtain guidance and direction on addressing audit requests. DPH will implement a protocol wherein the program executing any contract using federal funds will collect and maintain sufficient records which detail the history of the procurement. The program will also verify that compliance with procurement requirements is maintained for all federally funded contracts, including sufficient documentation to demonstrate compliance with suspension or debarment. To confirm this, the program will check the SAM exclusions prior to entering into a contract and will maintain documentation of that verification. These will ensure DPH’s ability to provide documentation when requested by auditors. 3. Anticipated implementation date: July 1, 2024

1. Person responsible: Director, Department of Public Health 2. Corrective action plan: DPH, Acute Communicable Disease Control (ACDC) agrees with the finding and recommendation. Before entering into contract, DPH will check for SAM exclusions with date indicating verification before contract execution and keep this documentation on file. DPH, Administrative Services Division (ASD) - Procurement agrees with the finding and recommendation. DPH’s Administrative Services Division Manager will email Procurement staff to remind staff/manager to ensure SAM.GOV verification documents are included in all federally funded purchases before finalizing/approving those transactions. 3. Anticipated implementation date: March 11, 2024 and April 30, 2024

October 19, 2023 Cognizant or Oversight Agency for Audit Veritas Prep Charter School respectfully submits the following corrective action plan for the year ended June 30, 2023. AAFCPAs 50 Washington Street Westborough, MA 01581 Audit period: July 1, 2022-June 30, 2023 The finding from the June 30, 2023 schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule. Significant Deficiency and Material Instance of Non-Compliance DEPARTMENT OF EDUCATION 2023-001 Assistance Listing Number 84.282 Charter Schools (CSP) Recommendation: AAFCPAs recommends that management follows its procurement policy which complies with Uniform Guidance requirements. Action Taken: Management prioritized being equipped for the opening of school with students when faced with a tight timeline to apply for and expend grant funds. In a time when delays on goods and services were normalized, management moved forward with a furniture order that met all of our operational needs including a guaranteed delivery timeline that included assembly and setup as well as the quality and aesthetic of the furniture we were confident with. In doing so, we did not ensure full compliance with the School's procurement process. Management remains confident in the School's procurement policies and if ever a similar, albeit atypical, situation should arise we will ensure compliance with the School's procurement policies. Management understands that following the School's procurement policy, which complies with Uniform Guidance, is necessary so as not to jeopardize future funding opportunities. If the Department of Education has questions regarding this plan, please call Rachel Romano #413-222-3434. Sincerely yours, Rachel Romano Chief Executive Officer Veritas Preparatory Charter School

FINDING 2023-005 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, COVID-19 National School Lunch Program; Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Number and Year (or Other Identifying Numbers): FY2021-2022, FY2022-2023 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Finding: Material Weakness, Modified Opinion Contact Person Responsible for Corrective Action: Tiffiny Ulman Contact Phone Number and Email Address: 219-924-4250 tulman@griffith.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Establish post award internal controls surrounding grant management including, but not limited to, Procurement and Suspension and Debarment. Anticipated Completion Date: 3/5/2024

Finding 2023-004 – Material Weakness AL No: 20.507 Federal Grantor: U.S. Department of Transportation, Federal Transit Administration, Federal Transit Formula Grants - Direct Award. Compliance Requirement: Procurement, Suspension and Debarment. Condition: The District was unable to provide documentation that the procurement of the CNG tank replacement project for five Orion buses exceeding the simplified acquisition threshold of $250,000 was approved by the Board. There is documentation that an invitation for bid (IFB) was released for the project, but only one bid was received, and the District awarded the contract to the sole bidder. Missing documentation includes support of the rationale to approve the contract absent evidence of full and open competition. The District was also not able to provide the request for proposal for review. Criteria: 2 CFR Part 200 Subpart E (Uniform Guidance) states the following: • Section 200.318(a) states that “The non-federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or service required under a Federal award or subaward. The non-Federal entity’s documented procurement procedures must conform to the procurement standards identified in Sections 200.317 through 200.327.” • Section 200.318(i) states that “The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price.” • Section 200.320(c) states that “There are specific circumstances in which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded if one or more of the following circumstances apply: (1) The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold…; (2) The item is available only from a single source; (3) The public exigency or emergency for the retirement will not permit a delay resulting from publicizing a competitive solicitation; (4) The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the non-Federal entity; or (5) After solicitation of a number of sources, competition is determined inadequate.” • Section 200.324(a) states that “The non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals.” Cause: Staff turnover at the District and the need for the project to be completed by a certain date to avoid the buses losing certification led to the lack of adequate records being maintained. Effect: The District was unable to prove it was in compliance with the Uniform Guidance regarding open competition on procurements. the buses to be operational, so not every step was documented. The awarded contract was signed on the date of a Board meeting, but the Board minutes did not document that this contract was reviewed nor approved by the Board. Recommendation: We recommend the District establish a procurement folder on its server with subfolders for each individual procurement where documentation of each procurement is maintained, including advertising of the procurement, requests for proposals, proposals received, analysis of reasons for selecting the winning bid, executed contract, certifications by contractor if not part of proposal or executed contract, management report to board recommending which bid should be approved, board resolution approving the winning bid and for contracts under $250,000 a memo or form documenting bids received and reason for selecting the bid, including reasons for not selecting the lowest bid if applicable. We also recommend training be provided to staff that work on procurements of the requirements under Uniform Guidance Section 2 CFR 200.318 to 200.326. View of Responsible Officials and Planned Corrective Action: Management agrees with the recommendation and acknowledges the importance of complying with uniform guidance regarding open and competitive procurements. Due to key staff turnover, the District could not locate documentation for the CNG tank replacement procurement to prove compliance with uniform guidance. In addition, the reason the agreement was not brought to the Board for approval could not be determined by current staff. To address the issues, the District will review its procurement and documentation procedures in addition to establishing checklists to ensure compliance and proper records retention.

Views of Responsible Officials: AHCMC acknowledges that it does not have a formal and open procurement policy that requires full and open competition for purchases of goods and services. AHCMC will implement a procurement policy that conforms to the Uniform Guidance. AHCMC will also maintain documentation to support that the procurement policy is adhered to. AHCMC will also develop internal controls to maintain documentation that required suspension and disbarment searches were performed on the SAM website.

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: For three vendors, the School Corporation did not obtain price or rate quotes as required. The School Corporation did not maintain documentation to support the rationale and justification to limit competition, and there was no documentation of the history of the procurement which would include the rationale for the method of procurement, the selection of the vendor, and the basis for price. Contact Person Responsible for Corrective Action: Food Service Director, Maggie Caudill Contact Phone Number and Email Address: (812) 649-2591 / maggie.caudill@sspencer.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Small Purchase Procurement: The Food Service Director will maintain a binder/Google Drive folder with documentation of price and/or rate quotes and documentation of the attempts made from at least three vendors that fall within the small purchase threshold. If price and/or rate quotes cannot be obtained from at least three vendors, documentation of the reasoning will be maintained. Suspension and Debarment: The Food Service Director will ensure that all vendors are not suspended or debarred by either ensuring the suspension and debarment verbiage is included in the contracts, providing a clause to the vendor to sign that they are not suspended or debarred, or checking the SAM.gov website. Documentation of these records will be maintained for audit. Anticipated Completion Date: June 2024

FINDING 2023-006 Finding Subject: Special Education Cluster (IDEA) – Procurement Summary of Finding: The School Corporation was a member of the Clark County Joint Services Program (Cooperative). During fiscal year 2021-2022. The School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation to ensure compliance with the Procurement compliance requirement. Two vendors exceeded the small purchase threshold during the audit period and both vendors were selected for testing. For both vendors only the quote that was utilized was retained and no other audit evidence could be provided to show that additional quotes as required were obtained. Documentation detailing the history of procurement, which must include the reason for the procurement method used, selection of the vendor, and the basis for the price, was not retained for audit for either purchase. Contact Person Responsible for Corrective Action: Ashley Compton, Director of Special Education and Allison Vanover, Corporation Treasurer Contact Phone Number and Email Address: 812-246-3375 alcompton@scsc.school avanover@scsc.school Views of Responsible Officials: We do not concur with the finding. Explanation and Reasons for Disagreement: The two instances cited in this finding were the results of a purchase made through the cooperative purchasing agency. Silver Creek chose this vendor that IAESC manages. IAESC serves as a governmental body in which SCSC is allowed to enter into an agreement to form a cooperative purchasing organization per IC 5-22-4-7. We can provide evidence that the cooperative purchasing agency has properly conducted an RFP for these two purchases. After reviewing the purchases for CDW Government and School Outfitters, SCSC does not recognize these as small purchases since these items were listed separately on the voucher and did not cross the threshold of $10,000.00.

􀀃 Finding􀀃2023􀍲007􀀃 􀀃 Finding􀀃Subject:􀀃Special􀀃Education􀀃Cluster􀀃􀍲􀀃Procurement􀀃 Summary􀀃of􀀃Finding:􀀃The􀀃district􀀃does􀀃not􀀃have􀀃a􀀃procurement􀀃policy􀀃outlining􀀃 procurement􀀃standard􀀃for􀀃all􀀃federal􀀃programs.􀀃􀀃Internal􀀃Controls􀀃were􀀃deficient􀀃in􀀃 preventing􀀃noncompliance􀀃and􀀃not􀀃maintaining􀀃methods􀀃of􀀃procurement.􀀃 Contact􀀃Person􀀃Responsible􀀃for􀀃Corrective􀀃Action:􀀃Director􀀃of􀀃Business􀀃 Contact􀀃Phone􀀃Number􀀃and􀀃Email􀀃Address:􀀃(260)431􀍲2030,􀀃msnyder@sacs.k12.in.us􀀃 􀀃 Views􀀃of􀀃Responsible􀀃Official:􀀃We􀀃concur􀀃with􀀃the􀀃finding.􀀃 Description􀀃of􀀃Corrective􀀃Action􀀃Plan:􀀃 The􀀃school􀀃board􀀃will􀀃adopt􀀃a􀀃procurement􀀃policy􀀃for􀀃all􀀃federal􀀃programs􀀃to􀀃comply􀀃 with􀀃procurement􀀃standards􀀃and􀀃the􀀃policy􀀃will􀀃be􀀃implemented.􀀃􀀃Additionally,􀀃The􀀃 Director􀀃of􀀃Special􀀃Education􀀃and􀀃the􀀃Special􀀃Education􀀃Treasurer􀀃will􀀃ensure􀀃 procurement􀀃procedures􀀃are􀀃followed􀀃for􀀃all􀀃purchases􀀃and􀀃if􀀃the􀀃total􀀃is􀀃between􀀃 $50,000􀀃and􀀃$150,000􀀃a􀀃contract􀀃will􀀃be􀀃awarded.􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃 dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Special􀀃Education􀀃and􀀃the􀀃 Special􀀃Education􀀃Treasurer.􀀃 􀀃 Anticipated􀀃Completion􀀃Date:􀀃On􀀃or􀀃before􀀃June􀀃30,􀀃2024􀀃

􀀃 Finding􀀃2023􀍲006􀀃 􀀃 Finding􀀃Subject:􀀃Child􀀃Nutrition􀀃Cluster􀀃–􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment􀀃 Summary􀀃of􀀃Finding:􀀃Internal􀀃Controls􀀃were􀀃not􀀃effective􀀃and􀀃did􀀃not􀀃ensure􀀃procurement􀀃 is􀀃done􀀃properly􀀃and􀀃allowed􀀃the􀀃district􀀃to􀀃enter􀀃an􀀃agreement􀀃with􀀃a􀀃vendor􀀃that􀀃did􀀃not􀀃 have􀀃proper􀀃documentation􀀃that􀀃they􀀃were􀀃not􀀃excluded.􀀃 Contact􀀃Person􀀃Responsible􀀃for􀀃Corrective􀀃Action:􀀃Director􀀃of􀀃Food􀀃Service􀀃 Contact􀀃Phone􀀃Number􀀃and􀀃Email􀀃Address:􀀃(260)431􀍲2030,􀀃msnyder@sacs.k12.in.us􀀃 􀀃 Views􀀃of􀀃Responsible􀀃Official:􀀃We􀀃concur􀀃with􀀃the􀀃finding.􀀃 Description􀀃of􀀃Corrective􀀃Action􀀃Plan:􀀃 Procurement􀀃–􀀃Region􀀃8􀀃 The􀀃Director􀀃of􀀃Food􀀃Service􀀃has􀀃the􀀃responsibility􀀃to􀀃ensure􀀃participation􀀃with􀀃IDOE􀀃 approved􀀃SFA􀀃Cooperatives􀀃only.􀀃􀀃We􀀃now􀀃utilize􀀃Food2School􀀃and􀀃have􀀃the􀀃 necessary􀀃documentation.􀀃􀀃􀀃If􀀃we􀀃consider􀀃other􀀃Cooperatives,􀀃the􀀃Director􀀃will􀀃 ensure􀀃they􀀃are􀀃approved.􀀃􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃dated,􀀃and􀀃retained􀀃by􀀃 school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃 Services.􀀃 􀀃 Procurement􀀃􀍲􀀃SACS􀀃 The􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃Services􀀃will􀀃ensure􀀃 procurement􀀃procedures􀀃are􀀃followed􀀃for􀀃all􀀃purchases􀀃and􀀃if􀀃the􀀃total􀀃is􀀃between􀀃 $50,000􀀃and􀀃$150,000􀀃a􀀃contract􀀃will􀀃be􀀃awarded.􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃 dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃 Asst.􀀃Director􀀃of􀀃Food􀀃Services.􀀃 􀀃 Suspension􀀃and􀀃Debarment􀀃 The􀀃Director􀀃of􀀃Food􀀃Service􀀃has􀀃the􀀃responsibility􀀃to􀀃ensure􀀃that􀀃all􀀃vendors􀀃are􀀃free􀀃 from􀀃suspension,􀀃debarment,􀀃or􀀃aren’t􀀃otherwise􀀃excluded.􀀃Suspension􀀃and􀀃 debarment􀀃documents􀀃are􀀃to􀀃be􀀃collected􀀃on􀀃a􀀃yearly􀀃basis.􀀃If􀀃such􀀃documents􀀃are􀀃 not􀀃available􀀃through􀀃the􀀃SFA􀀃Cooperative,􀀃it􀀃will􀀃be􀀃the􀀃responsibility􀀃of􀀃the􀀃 Director􀀃of􀀃Food􀀃Service􀀃to􀀃acquire􀀃them􀀃through􀀃SAM.gov􀀃website􀀃or􀀃contacting􀀃the􀀃 vendor􀀃directly.􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃 by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃Services.􀀃􀀃 􀀃 􀀃 INDIANA STATE BOARD OF ACCOUNTS 51 􀀃 Preparing today’s learners for tomorrow’s opportunities. 􀀃 Anticipated􀀃Completion􀀃Date:􀀃3/18/24􀀃

DHS has established a process for ensuring all Open Market Purchases above $24,999.99 are directed to a competitive solicitation per the State of Georgia Procurement Manual. The new DHS Office of Procurement Services is accountable for monitoring all Open Market Purchases and the DHS competitive solicitation process.

Food Worker Relief Program – Assistance Listing No. 10.181 Recommendation: We recommend that the Organization strengthen its controls and processes to identify all procurement transactions, ensure the appropriate procurement policies and levels are followed and clearly documented, and to verify vendors are not suspended or debarred. These procedures will help ensure compliance with Compliance Supplement and the Code of Federal Regulations related to procurement and suspension and debarment provisions. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management has taken the follwing steps to ensure procurement policies are followed : 1) Management has begun the hiring process for additional staffing in the Procurement Department to help support all operations. 2) Management will review and update current policy to be in line with Federal Procurement policies. 3) Procurement department will provide training to all personnel authorized for purchases. Name(s) of the contact person(s) responsible for corrective action: Jesse Satterlee, Interim CFO, 778-730-1155 Nancy Lipman, SVP Compliance, 602-257-0700 Planned completion date for corrective action plan: 6/30/2024 – Ongoing action and Implementation

Action taken in response to finding: The Organization agrees with the finding. The Organization will adopt a formal procurement policy in accordance with federal requirements. Name(s) of the contact person(s) responsible for corrective action: Paula Culp, Chief Administrative Officer Planned completion date for corrective action plan: March 2024

FINDING 2023-002 Finding Subject: Child Nutrition Cluster – Procurement and Suspension and Debarment Summary of Finding: We did not use the formal bid process for a vendor purchase over the simplified acquisition threshold. We did not ensure that all vendors over the $25,000 threshold were not suspended or debarred from conducting business with us. Contact Person Responsible for Corrective Action: Leeanne Koeneman Contact Phone Number and Email Address: Leeanne.Koeneman@nacs.k12.in.us; 260-637-8768 Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director will track cumulative expenditures for Vendor by Fiscal Year to ensure that compliance requirements related to procurement thresholds are met. Simultaneously, the Treasurer’s Office will provide reports to the Food Service Department on a monthly basis detailing the cumulative expenditures by vendor paid from the Food Service Fund. With thresholds being actively monitored, the Food Service Director will request quotes or bids, as applicable by individual and cumulative thresholds. Utilizing the procedures outlined above, individual and cumulative expenditures over $25,000 will be verified to ensure that the potential vendor(s) has not been suspended or debarred. Upon checking the status of vendor(s) at the Food Service Department, the results will be sent to the Treasurer’s office for review. Anticipated Completion Date: June 30, 2024

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: Procurement The School Corporation failed to award contracts to four vendors totaling $314,783, which were considered small purchases. For small purchases of over $10,000 but less than $150,000, an informal process allows securing rate quotations from an adequate number of sources; however, the process still requires a written contract between the vendor and the school corporation. Suspension and Debarment The School Corporation failed, due to the lack of effective internal controls, to provide adequate oversight of the suspension/debarment process to ensure compliance to the process prior to paying vendors that were expected to be paid an amount equal to or exceeding $25,000. Contact Person Responsible for Corrective Action: Carla Gambill Contact Phone Number and Email Address: 812-847-6020 ext. 1004 cgambill@lssc.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Procurement When quotes for small purchases are received, the Director of School Finance will acknowledge a quote provided by a vendor that will be accepted by the corporation by written letter acknowledging the school corporation’s acceptance of the quote. The contract as well as the quote will be retained by the Director of School Finance and the Director of Food Services for comparison to invoices. INDIANA STATE BOARD OF ACCOUNTS 30 Suspension and Debarment On an annual basis, all vendors that are expected to be paid in excess of $25,000 will be searched by the Director of School Finance for suspension or debarment or the vendor will provide certification, either as a separate document, or as part of a written contract, that the vendor is not excluded or disqualified to receive federal funds. Those searches or other documentation will be reviewed by the Superintendent and acknowledged by signature. Anticipated Completion Date: This Corrective Action Plan will be put in effect March 2024.

FINDING 2023-007 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement The School Corporation did not complete or submit the fiscal year 2023 Procurement Plan as required to the Indiana Department of Education. Suspension and Debarment The School Corporation was a member of the East Central Educational Service Center (ECESC) during fiscal years 2021-2022 and 2022-2023. ECESC verified that vendors were not suspended or debarred when securing bids for food, dairy, and bread products on behalf of the member schools. However, for purchases of goods and services exceeding $25,000 handled by the School Corporation, 3 of the 5 vendors selected for testing were not verified for suspension and debarment to ensure vendors were not suspended or debarred from participation in federal programs. Contact Person Responsible for Corrective Action: Julie Cramer Contact Phone Number and Email Address: 765-932-4186 cramej@rushville.k12.in.us Views of Responsible Officials: We concur with the finding. Explanation and Reasons for Disagreement: N/A Description of Corrective Action Plan: Due to turnover in the Superintendent position and Food Service Director, position there was no access to SAM to verify vendor. This has been now been corrected and the Superintendent and Assistant Superintendent have access to SAM. They will verify for the Food Service Director any company will wish to deal with over $25,000. Future purchases will meet the school corporation’s procurement policy. All vendors in which expenditure exceed $25,000 will reviewed by the Food Service Director and either the Superintendent or Assistant Superintendent. Procurement – A 2023 procurement plan has been developed and will be sent to the Indiana Department of Education. Anticipated Completion Date: April 2024

FINDING 2023-002 Finding Subject: Child Nutrition Cluster -Procurement and Suspension and Debarment Summary of Finding: The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with Procurement, Suspension and Debarment. The School Corporation entered into more than $50,000 of like/kind transactions with a single vendor during FY2022 and FY2023 without entering into a contract or properly verifying that the vendor was not suspended or debarred. Contact Person Responsible for Corrective Action: Tracy Troesch Contact Phone Number and Email Address: 812-817-0900; tracy.troesch@sedubois.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Business Manager will review the vendors related to covered transactions and determine if like/kind transactions with any vendor are approaching or are expected to exceed $50,000. For vendors that meet the criteria of requiring a contract, the Business manager will obtain a contract, which will be reviewed and approved by the school board. The Business Manager will upload the purchase order and quote or other documentation of any purchase over $50,000 on Indiana Gateway for Government Units (Gateway) after board approval. Southeast Dubois County School Corporation followed the corrective action that was issued during the prior audit for Suspension and Debarment. During the current audit, the State Board of Accounts indicated that the corrective action and steps that were taken to verify compliance that the School Corporation was instructed to do were not adequate. Going forward, the Business Manager will run monthly vendor reports to determine if any vendors are close to the $25,000 to get a Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion form from the IN Department of Education needs to be issued to a vendor. If a vendor is close to the $25,000 mark, the Business Manager will send the Certification to be returned prior to future payment. Anticipated Completion Date: September 2024

Corrective Action: On November 23, 2023 MHC updated its Procurement Policy to require formal documentation of all rate quotes related to federal funding in accordance with federal procurement standards. This updated policy was then shared with MHC personnel responsible for contracting for services and has been implemented for transactions after this date. Name of Contact Person: Jennifer A. Pulse , CFO; Telephone number: 860-856-7963; Email address: JPulse@mhconn.org. Projected Completion Date: Completed 11/23/2023 If the Office of Management and Budget requires any additional information or has questions regarding this Plan, please call Jennifer A. Pulse at 860-856-7963.

FINDING 2023-004 Finding Subject:􀀃Child􀀃Nutrition􀀃Cluster􀀃􀍲􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment Summary of Finding: An􀀃effective􀀃internal􀀃control􀀃system􀀃was􀀃not􀀃in􀀃place􀀃at􀀃the􀀃School􀀃Corporation􀀃to􀀃ensure􀀃compliance􀀃with􀀃 requirements􀀃related􀀃to􀀃the􀀃grant􀀃agreement􀀃and􀀃the􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment􀀃compliance􀀃 requirement.􀀃 Contact Person Responsible for Corrective Action: Lela Simmons Contact Phone Number and Email Address: (219) 391- 4100, lesimmons@ecps.org Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: All􀀃purchases􀀃will􀀃require􀀃three􀀃quotes􀀃to􀀃ensure􀀃the􀀃Vendor􀀃is􀀃compliance􀀃with􀀃purchase􀀃of􀀃$150,000􀀃or􀀃exceed􀀃 micro􀍲purchase􀀃threshold􀀃of􀀃$10,000􀀃all􀀃quotes􀀃will􀀃be􀀃attached􀀃to􀀃the􀀃APV.􀀃This􀀃will􀀃ensure􀀃all􀀃documents􀀃are􀀃 available􀀃upon􀀃request.􀀃The􀀃School􀀃Corporation􀀃will􀀃work􀀃with􀀃State􀀃to􀀃receive􀀃approval􀀃of􀀃Food􀀃Service􀀃 Management􀀃Company.􀀃􀀃 Anticipated Completion Date: We anticipate having the above corrective action plan in place by September 30, 2024.

FINDING 2023-003 Finding Subject: Special Education Cluster (IDEA) – Procurement, Suspension and Debarment Summary of Finding: Insufficient documentation provided for proof of Procurement and Suspension and Debarment verifications Contact Person Responsible for Corrective Action: Ghirmay Alazar (Procurement) Phyllis Ritenour (Suspension & Debarment) Contact Phone Number and Email Address: 317-845-9400 galazar@msdwt.k12.in.us pritenour@msdwt.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: Procurement - At our educational institution, we prioritize the unique leaning needs of our students by actively seeking vendors who can effectively meet our expectations. To ensure transparency and fairness in the vendor selection process, we examine total costs estimates from each vendor and analyze their reputations, experience, customer feedback, and ability to provide innovative solutions. We use this information to make informed decisions and the rationale behind our vendor selection process. When searching for vendors we will keep documentation that displays the cost from each vendor and the rational for selecting a specific vendor. Suspension and Debarment – Beginning July 2024 the Assistant Accounting Manager will run reports annually in July from sam.gov and from FMS and compare the 2 files to make sure that we don’t have vendors in our system that are on the debarment list. The files will then be forwarded to the Accounting Manager via email for review and approval. The approval email and the 2 reports will be saved in our shared drive as proof of file review. All new vendors will be checked in sam.gov before allowing purchases to be placed. The review sheets will be emailed to the Accounting Manager for review and approval, these will also be saved in our shared drive. Anticipated Completion Date: Procurement – December 2024 Suspension & Debarment – July 2024

We agree with the auditor’s comments, and the following actions will be taken to ensure all procurement procedures are within compliance: 1. Review current Board policies on small purchase and micro-purchase thresholds 2. Receive multiple quotes/bids for contracts that will qualify as small purchases. 3. Maintain documentation of the above for records purposes The above steps will be completed and implemented by December of 2024 to follow Child and Adult Care Food Program, Child Nutrition Cluster guidelines.

FINDING 2023-004 Information on the federal program: Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.027X, 84.173, 84.173X Federal Award Numbers and Years (or Other Identifying Numbers): 19611-022-PN01, 20611-022-PN01, 21611-022-PN01, 22611-022-PN01, 22611-022-ARP, 23611-022-PN01, 20619-022-PN01, 21619-022-PN01, 22619-022-PN01, 22619-022-ARP, 23619-022-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Qualified Opinion Condition: The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the procurement and suspension an debarment requirements. The Cooperative had not designed or implemented adequate policies or procedures to ensure that proper procurement procedures for micro or small purchases were followed. There was no oversight, review, or approval process in place and documented at the Cooperative to ensure proper procedures were followed and price or rate quotations were obtained, if required, or documentation to support limited procurement procedures. Context: The School Corporation is a member of the Greene-Sullivan Special Education Cooperative (Cooperative). During fiscal year 2021-2022 and 2022-2023, the Cooperative operated the special education programs and spent the federal money on behalf of all its members.  As the grant agreements were between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation in order to ensure compliance with the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2022, three vendors, totaling $88,772, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the three vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All three vendors were tested. For all three, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2023, six vendors, totaling $264,106, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the six vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All six vendors were tested. For five of the six, totaling $252,906, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. “Covered transactions” include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. Upon inquiry of the School Corporation in order to review the procedures in place for verifying that a vendor with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the Cooperative disclosed they relied on a clause to be included in the vendor contracts to ensure compliance. Two covered transactions that equaled or exceeded $25,000 were identified. Both transactions, totaling $192,218, were selected for testing. One of the two transactions, totaling $44,883, included the appropriate clause. For the other vendor, the Cooperative did not verify the vendor’s suspension and debarment status prior to payment. The lack of internal controls and noncompliance regarding suspension and debarment were isolated to fiscal year 2023. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and will take the following corrective action: 1 – Southwest School Corporation will ensure a system of internal control and procedures are in place and appropriate procurement procedures for goods and services are followed. 2 – The Cooperative will post any openings that exceed the small purchase threshold in the local newspapers, within the office, and on the cooperative website. Any and all proposals will be presented to the Cooperative Board of Directors for approval. Responsible party and timeline for completion: Chris Stitzle, Superintendent – April 1, 2024

Auditor’s Recommendations: We recommend the District establish a policy and implement procedures regarding large purchases related to Federal grants to insure that no vendors who are suspended, debarred, or otherwise excluded from participating in transactions funded through Federal grants are used. As identified above, there are several methods in which the District can verify vendors who are not suspended or debarred. The District may have the vendor provide an annual certification that is s not currently suspended, debarred, or otherwise prevented from receiving Federal dollars. In other occasions in which a single purchase is going to be made, the purchasing procedures should include looking up the vendor on the GSA website, printing a copy of the verification, and placing it in the file with the purchase order. The District has options, and it should establish what method is the least intrusive, but also effective, in complying with the requirements of the Uniform Grant Guidance. Responsible Official’s Plan: • Specific corrective action plan for funding: The procurement Officer of SJSWCD has updated the procurement process on 12/7/23 that all contractors who will be receiving Federal monies must provide an annual certification that they are not suspended, debarred, inactive, or otherwise excluded from participating in transaction funded through Federal grants. The policy change will be approved at the next board meeting. • Timeline for completion of corrective action plan: December 7, 2023 • Employee position(s) responsible for meeting the timeline: Oralia Bridge, District Manager

FINDING 2023-006 Information on the federal program: Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.027X, 84.173, 84.173X Federal Award Numbers: 19611-022-PN01, 20611-022-PN01, 21611-022-PN01, 22611-022-PN01, 22611-022-ARP, 23611-022-PN01, 20619-022-PN01, 21619-022-PN01, 22619-022-PN01, 22619-022-ARP, 23619-022-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Qualified Opinion Condition: The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the procurement and suspension an debarment requirements. The Cooperative had not designed or implemented adequate policies or procedures to ensure that proper procurement procedures for micro or small purchases were followed. There was no oversight, review, or approval process in place and documented at the Cooperative to ensure proper procedures were followed and price or rate quotations were obtained, if required, or documentation to support limited procurement procedures. Context: The School Corporation is a member of the Greene-Sullivan Special Education Cooperative (Cooperative). During fiscal year 2021-2022 and 2022-2023, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation in order to ensure compliance with the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2022, three vendors, totaling $88,772, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the three vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All three vendors were tested. For all three, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2023, six vendors, totaling $264,106, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the six vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All six vendors were tested. For five of the six, totaling $252,906, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. “Covered transactions” include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. Upon inquiry of the School Corporation in order to review the procedures in place for verifying that a vendor with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the Cooperative disclosed they relied on a clause to be included in the vendor contracts to ensure compliance. Two covered transactions that equaled or exceeded $25,000 were identified. Both transactions, totaling $192,218, were selected for testing. One of the two transactions, totaling $44,883, included the appropriate clause. For the other vendor, the Cooperative did not verify the vendor’s suspension and debarment status prior to payment. The lack of internal controls and noncompliance regarding suspension and debarment were isolated to fiscal year 2023. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and will take the following corrective action: 1 – Northeast School Corporation will ensure a system of internal control and procedures are in place and appropriate procurement procedures for goods and services are followed. 2 – The Cooperative will post any openings that exceed the small purchase threshold in the local newspapers, within the office, and on the cooperative website. Any and all proposals will be presented to the Cooperative Board of Directors for approval. Responsible party and timeline for completion: Mark A Baker, Superintendent Effective April 2024