Corrective Action Plans

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS; AL No. 21.027; Direct Allocation, YEAR ENDED JUNE 30, 2024 Name of contact person: Fallon County Commission/Clerk and Recorder Corrective Action: Procedures will be developed that will provide reasonable assurance that procurement of goods and services are made in compliance with applicable federal regulations and other procurement requirements specific to a federal award or subaward, and that no subaward, contract or agreement for purchase of goods or services is made with any suspended or debarred party. Proposed Completion Date: Immediately

FINDING 2024-003 Finding Subject: Childhood Nutrition Cluster – Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Ralph Shrader, Superintendent Contact Phone Number and Email Address: (765) 762-3364 / rshrader@msdwarco.k12.in.us Views of Responsible Officials: Option 1: We concur with the finding Description of Corrective Action Plan: We will obtain quotes for any purchases that qualify under the small purchases requirement Any director responsible for corporation contracts, will be responsible for checking Sam.gov to ensure the vendor is not on the suspension and disbarment list. A secondary individual will verify the findings. In addition, the micropurchase threshold will be raised to $50,000. Anticipated Completion Date: Effective Immediately

FINDING 2024-005 Finding Subject: Child Nutrition Cluster-Procurement and Suspension and Debarment Summary of Finding: The school corporation made purchases from vendors without using the procurement method and verifying that the vendor was not suspended or debarred. The School corporation did not properly implement a process to identify and assess internal and external risks, or monitor internal control activities to ensure they were operating effectively. Contact Person Responsible for Corrective Action: Melissa Embry Contact Phone Number and Email Address: 812-547-2637 melissa.embry@cannelton.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: We will follow all correct procurement plans set forth in the future. We will also verify with each vendor and have a form filled out stating that they are not suspended or debarred. Cannelton management will establish a proper system of internal controls including policies and procedures related to risk assessment and monitoring activities within the federal program. Anticipated Completion Date: The School will ensure proper procurement methods are followed and that vendors are properly checked for suspension and debarment by December 2025. The additional controls will be implemented by August 2025.

2024-002: Suspension and Debarment Recommendation: CLA recommends the Agency update its procurement policy to include procedures that a vendor be verified as not being debarred, suspended, or excluded and documentation maintained to support the determination. Explanation of disagreement with audit finding: There is no disagreement with this finding. Action taken in response to finding: The Agency is committed to following the procurement process and requirements outlined within the policies and procedures. The Agency plans to revise current procurement policy to have a process for debarred, suspended, or excluded and documentation maintained to support the determination. All procurement will be monitored through the Sage Intacct and Ramp system, which has already been implemented. Name of the contact person responsible for corrective action: Dhiren Shah, CFO Planned completion date for corrective action plan: Immediately If the U.S. Department of Housing and Urban Development has questions regarding this plan, please call Dhiren Shah, CFO, at 630-248-1181.

Internal Control: When a purchase is made with any vendor over the $25,000 threshold from Fund #800, School Lunch, Fund, the superintendent along with the treasurer or deputy treasurer (minimum of two people) will require that any vendors selected are in compliance with the Procurement and Suspension and Debarment compliance requirements by completing one the of following quality checks with each vendor prior to purchase: a. Checking the federal System for Award Management (SAM) database at https://sam.gov/content/exclusions and maintain a screen shot of the search results b. Collect a certification from the vendor directly c. Adda clause or condition to the covered transaction with the vendor

Information on the federal program: Subject: Special Education Cluster – Internal Controls Federal Agency: Department of Education Federal Program: Special Education Preschool Grants Assistance Listing Number: 84.173, 84.173X Federal Award Numbers and Years (or Other Identifying Numbers): 23619-008-PN01; 22619-008-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Finding: Material Weakness Context: The School Corporation is a member of the Delaware-Blackford Special Education Cooperative (Cooperative). During fiscal year 2022-2023, the Cooperative operated the special education preschool program and spent the federal money on behalf of six of its seven members. As the grant agreements were between the Indiana Department of Education 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. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the procurement and the suspension and debarment requirements. The Cooperative did not have adequate procedures in place to ensure that the requirements for small purchases were met for each applicable procured good or service or to ensure that vendors were not suspended or debarred prior to entering into a covered transaction. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for goods or services does not exceed the simplified acquisition threshold, which is customarily set at $250,000. However, Indiana Code 5-22-8 has a more restrictive threshold of $150,000 or less for when small purchase procedures may be used. 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. If it is determined a single source provider can be used for a small purchase, documentation must be retained supporting the determination. Two vendors exceeded the small purchase threshold during the audit period. The Cooperative provided evidence of a quote being obtained for the first vendor, however, evidence of obtaining multiple quotes was not retained for audit. The chosen quote was attached to the accounts payable vouchers and provided for audit; however, the other quotes obtained for the purchase were not maintained. For the second vendor, the Cooperative determined psychological services were to be provided by a single source provider, however, they did not have a documented rationale or support for the decision. 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 available for audit for either purchase. Suspension and Debarment The School Corporation did not have internal controls in place to ensure compliance with the suspension and debarment requirement. The Cooperative did not have adequate internal controls in place to ensure all applicable vendors were not suspended or debarred prior to entering into a covered transaction. As such, the Cooperative entered into a contract totaling $32,388, which exceeded $25,000, for psychological services. The Cooperative did not perform procedures to ensure that the vendor was not suspended or debarred from participation in federal programs. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Contact Person Responsible for Corrective Action: Dr. Greg Roach Contact Phone Number: 765-378-3329 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: During quarterly meeting with MCS Co-op, will discuss that internal controls are in place for procurement, suspension and debarment requirements are in place for purchases. Anticipated Completion Date: 2025 next quarterly meeting with Muncie Community Schools Co-op

NGA had previously developed and socialized our procurement process and procedure with our staff members. In response to this finding, NGA will continue to train program staff on the documentation requirements regarding procurement decisions required to comply with our established policy. We will continue to review new contract requests carefully to ensure that all the necessary compliance documentation is captured and easily accessible to auditors in the future. Also, in cases where circumstances require that NGA work with a specific entity, we work with program leaders to produce a memo to file highlighting the particular requirements of the work and decision criteria that lead to our selection of individual vendors. The CFO will also work with management to inform supervisors when procedures are not followed. They may follow up with individuals who have not completed the compliance requirements or steps.

The District will update the procurement policy to reflect all the required files as noted in the procurement standards set out at 2 CFR sections 200.318 through 200.327. The District Board of Directors will review and approve all updates through Board action at a Regular Meeting of the Board of Directors

Views of Responsible Officials:  The Organization will update its procurement policy to be in conformance with Federal cost principles for approval at the next Board Meeting on February 24, 2025.  Supporting operating procedures will be reviewed and adjusted accordingly to ensure compliance with the policy by February 28, 2025.  The situation resulting in this finding was for the procurement of support services for a new electronic health records system which was successfully implemented using the services purchased at a reasonable cost; however, the procedures followed by previous staff did not fully comply with the Organization's policies and procedures nor the Federal cost principles. The Organization has since implemented additional procedures to ensure documentation for competitive bids and justification for all purchases to comply with Federal requirements enhancing the Organization's internal procedures. The Organization will do a full review of the Federal cost principles and suggested procedures to ensure full compliance and implement new policies and additional procedures, as necessary, by February 28. 2025.

University System Response/Corrective Action Plan Regarding the finding that no documentation was provided to ensure the proper procurement was completed for the purchase of a software license for $116,431. The University of North Dakota agrees, the software license was signed by an individual without authority. The individual responsible is no longer in a departmental administrative position at the University of North Dakota. The University of North Dakota has implemented mandatory campus-wide Procurement training for all users with security roles in our procurement system, effective December 2024. Regarding the finding that two pieces of equipment were purchased totaling $100,440 and formal bidding was not competed. The University of North Dakota agrees; due to an error in completing the public notice posting, the relevant state bidders list was not notified of the procurement opportunity. The University of North Dakota notes that three bidders were contacted (simplified acquisition) but agree this does not meet the formal bidding requirements. The procurement officer responsible for the error has been retrained. The University of North Dakota also understands that the state's new public notice system, which should go live in May 2025, is anticipated to require/mandate the selection of a bidders for all future public notices. Contact Person: Tom Scrivener, CPO Anticipated Completion Date: Completed

Contact Person Neil Breidenbach Planned Corrective Action The District will create and approve a procurement policy that adheres to state and local regulations as well as 2 CFR Part 200.317 through 200.327. Planned Completion Date December 31, 2025.

FINDING 2024-003 Finding Subject: Summary of Finding: Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States; COVID-19 - Special Education Grants to States; Special Education Preschool Grants; COVID-19 - Special Education Preschool Grants Assistance Listings Numbers: 84.027; 84.173 Federal Award Numbers and Years (or Other Identifying Numbers): 22611-042-ARP; 22619-042-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement(s): Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Contact Person Responsible for Corrective Action: Dawn Mason, Business Manager, DeKalb Co. Eastern CSD Contact Phone Number and Email Address: 260-868-2125 Views of Responsible Officials: We concur with the findings. Description of Corrective Action Plan: The expenditures referenced in the finding were expended from the American Rescue Plan Special Education grant funds which were fully expended during the audit period. All future expenditures triggering procurement and suspension and debarment requirements will include implementing the following procurement policies. Reference Procurement Standards 2 CFR 200.318 Districts may not enter into contracts with entities that have been suspended or debarred from participating in contracts with federal funds. For contracts over $25,000, districts must verify a contractor is not excluded or disqualified. Contractors must be verified in one of three ways: 1. Checking the System for Award Management (SAM) (www.SAM.gov) 2. Collecting a certificate from that contractor. 3. Adding a clause or condition to the covered transaction with that contractor. (Recommended) **Proper verification and documentation must be sent to the LEA for audit purposes. INDIANA STATE BOARD OF ACCOUNTS 32 3326 CR 427, Waterloo, IN 46793 p 260-920-1011 f 260-837-7767 Steven E. Teders, Ed.S., Superintendent Loraine K. Vaughn, Ed.S., Assistant Superintendent Mark W. Rohm, Chief Financial and Operations Officer Personalized Pathways for Success Methods of Procurement Where specific EDGAR/UG thresholds apply, Districts must meet baseline requirements for procurement. If State or local rules have more restrictive thresholds, the most restrictive rule must be followed. Informal Procurement Procedures 1. Micro-purchase (0-$50,000) Dekalb County Eastern CSD has self-certified micro-purchases for up to $50,000 Micro-purchases may be awarded without soliciting competitive quotes if the district considers the price to be reasonable. Quotes must be attached to the invoice/checks for proper documentation and retained by the LEA. 2. Small Purchase ($50,000 – $150,000) Three quotes are required prior to purchase unless the purchase comes from a “Sole Source” vendor. Small purchases are required to be ordered under a purchase order unless in an emergency. Additional quotes must be presented along with the purchase order prior to being approved by the LEA. Formal Procurement Procedures 1. Sealed Bids (above $150,000) Bids must be solicited from an adequate number of suppliers, providing them with sufficient response time prior to the opening of the bids. Proper advertisement and procedures must be followed per IC 5-22 and corresponding documentation must be presented to the LEA prior to any final approval or purchases being made. 2. Competitive Proposals (above $150,000) The Request for Proposal method is used for procurements in which factors other than cost play a significant role. Per IC 5-22-9, when a purchasing agent makes a written determination that the use of competitive sealed bidding is either not practicable or not advantageous to the governmental body, the purchasing agent may award a contract using this procedure instead of competitive sealed bidding. This provides a formal process for the procurement of goods and/or services for which price is not the sole factor in the selection of a vendor or vendors. Proper advertisement and procedures must be followed per IC 5-22 and corresponding documentation must be presented to the LEA prior to any final approval or purchases being made. Noncompetitive (Sole Source) All sole source procurements require adequate written justification and must be attached to the corresponding purchase order or payment. Anticipated Completion Date: All expenditures initiated after March 12, 2025

FINDING 2024-004 Finding Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Dawn Mason, Business Manager, DeKalb Co. Eastern CSD Contact Phone Number and Email Address: 260-868-2125 Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The expenditures referenced in the finding were expended from the American Rescue Plan Special Education grant funds which were fully expended during the audit period. All future expenditures triggering procurement and suspension and debarment requirements will include implementing the following procurement policies. Reference Procurement Standards 2 CFR 200.318 Districts may not enter into contracts with entities that have been suspended or debarred from participating in contracts with federal funds. For contracts over $25,000, districts must verify a contractor is not excluded or disqualified. Contractors must be verified in one of three ways: 1. Checking the System for Award Management (SAM) (www.SAM.gov) 2. Collecting a certificate from that contractor. 3. Adding a clause or condition to the covered transaction with that contractor. (Recommended) **Proper verification and documentation must be sent to the LEA for audit purposes. Methods of Procurement Where specific EDGAR/UG thresholds apply, Districts must meet baseline requirements for procurement. If State or local rules have more restrictive thresholds, the most restrictive rule must be followed. Informal Procurement Procedures 1. Micro-purchase (0-$50,000) Dekalb County Eastern CSD has self-certified micro-purchases for up to $50,000 Micro-purchases may be awarded without soliciting competitive quotes if the district considers the price to be reasonable. Quotes must be attached to the invoice/checks for proper documentation and retained by the LEA. 2. Small Purchase ($50,000 – $150,000) Three quotes are required prior to purchase unless the purchase comes from a “Sole Source” vendor. Small purchases are required to be ordered under a purchase order unless in an emergency. Additional quotes must be presented along with the purchase order prior to being approved by the LEA. Formal Procurement Procedures 1. Sealed Bids (above $150,000) Bids must be solicited from an adequate number of suppliers, providing them with sufficient response time prior to the opening of the bids. Proper advertisement and procedures must be followed per IC 5-22 and corresponding documentation must be presented to the LEA prior to any final approval or purchases being made. 2. Competitive Proposals (above $150,000) The Request for Proposal method is used for procurements in which factors other than cost play a significant role. Per IC 5-22-9, when a purchasing agent makes a written determination that the use of competitive sealed bidding is either not practicable or not advantageous to the governmental body, the purchasing agent may award a contract using this procedure instead of competitive sealed bidding. This provides a formal process for the procurement of goods and/or services for which price is not the sole factor in the selection of a vendor or vendors. Proper advertisement and procedures must be followed per IC 5-22 and corresponding documentation must be presented to the LEA prior to any final approval or purchases being made. Noncompetitive (Sole Source) All sole source procurements require adequate written justification and must be attached to the corresponding purchase order or payment. Anticipated Completion Date: All expenditures initiated after March 12, 2025

Views of Responsible Officials: Additional procedures will be put in place better document in our policies and procedures to satisfy the requirements of 2 CFR 200. SAM background screening will be done on major contractors or vendors that are supported by Federal funds. Competitive bids will be fully documented and justified as why they were the chosen vendor. In the case if noncompetitive procurement based upon the usage at the request of the government agency or of limit of vendors providing that service we will maintain documentation in our files of the 5 specific circumstances of why this fits into a noncompetitive procurement situation.

This is the result of a contract that was signed for engineering work on the Grass Valley Nitrate Mitigation project. Individuals involved in the procurement process incorrectly relied on NRS requirements governing professional services contracts and did not go out to bid for the services. Additionally, Humboldt County serves as the financial processor for the Humboldt River Basin Water Authority Advisory Board. The HRBWA received grant funds for the water right relinquishment program through the State of Nevada Division of Water Resources. The County will enhance communication with the executive director of the HRBWA to ensure that all procurement processes are followed and documented.

Context: The School Corporation is a member of the Northeast Indiana Special Education Cooperative (Cooperative). During fiscal years 2022-2023 and 2023-2024, the Cooperative operated the special education program and spent the federal money on behalf of all its members. As the grant agreement was between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. Description of Corrective Action Plan: School Corporation will reach out to the Cooperative to discuss internal controls over procurement, and suspension and debarment and request annual listing of vendors exceeding federal and state procurement thresholds to ensure Cooperative adheres to regulations and established procurement policy and request that procurement policies are written, and all procurements are fully documented based upon the applicable federal and state standards Anticipated Completion Date: The School Corporation will implement the actions noted above quarterly to ensure proper internal controls are in place. The treasurer will request this information starting in April of 2025 for the first quarter of the calendar year.

Finding 2024-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Beverly Hindes Contact Phone Number: 219-996-4771 x128 Views of Responsible Officials: We agree with the finding. Description of Corrective Action Plan: The Treasurer will ensure compliance with the Procurement and Suspension and Debarment requirement. Anticipated Completion Date: March 3, 2025

CONDITION: The Leechburg Area School District contracted with TriMark for the purchase and installation of a dishwasher. This contract exceeded the Uniform Guidance micro purchase threshold of $10,000, but did not exceed the Simplified Acquisition Threshold of $250,000. The purchase was procured through a cooperative purchasing group (COSTARS). The School District was unable to provide documentation to verify that price or rate quotations were obtained from an adequate number of qualified sources. CRITERIA: Section 2 CFR 200.320(a)(2)(i) of the Uniform Guidance prescribes the bidding requirements for equipment, supplies, and work of any nature made by a non-federal entity whereby the cost exceeds certain dollar thresholds as adjusted periodically. In instances where the cost incurred exceeds the Uniform Guidance micro purchase threshold of $10,000 but does not exceed the Simplified Acquisition Threshold of $250,000, price or rate quotations must be obtained from an adequate number of qualified sources. In addition, as specified in 2 CFR 200. 318(i) of the Uniform Guidance, the School District must maintain sufficient records to detail the history of procurement. RECOMMENDATION: I am recommending that School District management review and update annually as necessary, School District federal financial policies and procedures to ensure In instances where the procurement cost incurred for goods and/or services exceeds the Uniform Guidance micro purchase threshold of $10,000 but does not exceed the Simplified Acquisition Threshold of $250,000, that 1) price or rate quotations are obtained from an adequate number of qualified sources, and 2) sufficient records are maintained to detail the history of procurement. These measures will enable the School District to comply with the procurement requirements as prescribed Sections 2 CFR 200.320(a)(2)(i) and 2 CFR 200.318(i) of the Uniform Guidance.MANAGEMENT’S CORRECTIVE ACTION PLAN: Management of the School District will review and update as necessary its procurement policies to ensure In instances where the procurement cost incurred for goods and/or services exceeds the Uniform Guidance micro purchase threshold of $10,000 but does not exceed the Simplified Acquisition Threshold of $250,000, that 1) price or rate quotations are obtained from an adequate number of qualified sources, and 2) sufficient records are maintained to detail the history of procurement. The timeframe for completion of this review will occur immediately with the intention of having the School District be in full compliance with Sections 2 CFR 200.320(a)(2)(i) and 2 CFR 200. 318(i) of the Uniform Guidance.

FINDING 2024-002 Finding Subject: Child Nutrition Cluster - Procurement Contact Person Responsible for Corrective Action: Kyle Zahn & Jack Lazar Contact Phone Number and Email Address: (765) 883-5576 kzahn@western.k12.in.us jlazar@western.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: At a coming leadership meeting the Finance Director will review procurement rules and procedures with the leadership team. Additionally, the Director of Finance and Food Service Director will conduct an audit of the vendors used for the Child Nutrition Cluster and revise as necessary current systems for identifying vendors who exceed $50,000 during a school year. Anticipated Completion Date: March 31, 2025

Views of Responsible Officials: We have already taken several steps to address this issue and to ensure that similar situations do not occur in the future: 1. Policy Review and Reinforcement: We have conducted a detailed review of the procurement policy to ensure that all relevant employees know its requirements and the importance of compliance. We are also revising our internal communication to ensure everyone involved in procurement knows the steps and documentation required. 2. Training and Awareness: To prevent future non-compliance, we are scheduling mandatory training sessions for all personnel involved in procurement activities. This will help ensure that all team members fully understand the policy and know how to apply it correctly.

FINDING 2024‐005 Finding Subject: Special education Cluster (IDEA) ‐ Procurement and Suspension and Debarment Summary of Finding: When the value of the procurement for property or services are within the small purchase threshold, or a lower threshold established by a nonfederal entity, quotes and a contract are required. The small purchase threshold is between $10,000 and $150,000 however the threshold between $10,000 and $50,000 require quotes from an adequate number of qualified sources. Indiana Code 5‐22‐8 has more restrictive requirements for the small purchase threshold between $50,000 and $150,000, which require three quotes and a contract to be awarded. The Cooperative had five vendors which fell within the small purchase threshold and all five vendors were tested. The Cooperative did not obtain quotes or competitive proposals, nor was a circumstance met that would have allowed for a noncompetitive procurement for the purchases. Three vendors paid from the grant funds were identified as being covered transactions during the audit period. All three vendors, provided goods or services which equaled or exceeded $25,000 and were selected for testing. For all three vendors, the Cooperative did not verify the vendors’ suspension and debarment status prior to payment. Contact Person Responsible for Corrective Action: Tim Scott Contact Phone Number and Email Address: 574‐654‐7273 tscott@npusc.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Due to several changes in personnel in the Special Education office, obtaining quotes and checking SAMS.gov was an oversight. The Special Ed Administrative Assistant and/or the Special Ed Director is now making sure these things are complete before a purchase order is entered or services are rendered. A copy of SAMS.gov and the quote are attached to the purchase order. Anticipated Completion Date: October 2024

Federal Agency Name: Department of Labor Assistance Listing Number: 17.270 Program Name: Reentry Employment Opportunities Finding Summary: The Organization’s procurement policy did not contain all of the required procurement standards and contract provisions as required by Uniform Guidance. The organization entered into a covered transaction with a vendor before performing a review to ensure the vendor was not suspended or debarred. Corrective Action Plan: SHIP has had a long‐standing partnership with Sky Ranch Behavioral Services (SRBS), the lone applicant for the BOOST GO’s Violence Prevention Services RFP. Since SHIP serves as fiscal agent and employer of record for SRBS, SHIP would know if SRBS was on the disbarred list. Therefore, the Executive Director did not check to see if SRBS was suspended or disbarred. Despite having this knowledge, this action still should have been taken to tick the boxes on SHIP’s procurement policy, and to stay consistent with this practice being done for other vendors. The Executive Director takes full responsibility for this oversight. SHIP will review its procurement policy to ensure it matches federal guidance and will make necessary revisions (if any), and will take a draft to the SHIP Board of Directors for approval. Once approved, training will be provided to all Program Directors and relevant staff to ensure everyone understands the steps and procedures for the procurement policy. SHIP will also review all MOUs and subcontracts to ensure they match the federal requirements Responsible Individual: Matt Ohman, Executive Director Anticipated Completion Date: Revised Procurement Policy will be presented to the SHIP Board for approval and staff will be trained by June 2024, ready for new fiscal year contracts.

FINDING 2024-003 Finding Subject: Child Nutrition Cluster – Procurement and Suspension and Debarment Summary of Finding: Documented evidence of the implementation of the control process was not maintained. Due to the lack of controls, it could not be determined that the school corporation ensured compliance with the grant agreement. Proper safeguards were not in place to ensure that documentation was properly maintained, causing the CFO and Food Service Director to be unable to locate the documentation for each procurement method. Contact Person Responsible for Corrective Action: Allison Pund and Margaret Leavitt Contact Phone Number and Email Address: 812-683-3971 x5002; punda1@swdubois.k12.in.us; leavittm@swdubois.k12.in.us Views of Responsible Officials: We concur with the finding. Explanation and Reasons for Disagreement: NA Description of Corrective Action Plan: The School Corporation will establish a proper system of internal control and develop policies and procedures to ensure all requirements are followed. Creation of these policies and procedures will be created by the CFO and Food Service Director. Internal controls will be put in place to ensure these policies and procedures are followed. In addition, the Food Service Director will maintain all bids, contracts, and other documentation to support the procurement methods used and will verify suspension and debarment prior to entering into covered transactions of $25,000 or more. Anticipated Completion Date: August 2025

FINDING 2024‐002 Subject: Special Education Cluster (IDEA) – Procurement Summary of Finding: During the 2023-2024 fiscal year, federal grant funds were to pay for contracted speech services. The vendors used exceeded the Simplified Acquisition Threshold and sealed bids or competitive proposals were not obtained. Contact Person Responsible for Corrective Action: Adam C. Minth Contact Phone Number: 219-374-3504 Views of Responsible Official: The school corporation concurs with the finding and will be implementing corrective procedures by the end of this fiscal year. Description of Corrective Action Plan: As a member of the Northwest Indiana Special Education Cooperative (NISEC), Hanover Community School Corporation usually expends contracted services out of our general education fund. For the fiscal year 2023-2024, we included our contracted speech services into our federal grant funds. During the audit, Hanover was notified that we didn’t follow the procurement procedures when expending out of the federal grant. This finding was due to Hanover not going out and receiving multiple bids for contracted companies that provide services to our students. Hanover uses three contracted companies to provide Speech Pathologist and Speech Language Assistants. We have used these three companies for many years and have built great working relationships with these providers. After receiving the finding, and discussing with the auditor, we created a memo that we took to our board. In the memo we explained why we use the three contracted vendors instead of going out for bids. Finding Speech Pathologists and Speech Language Assistants is very difficult in the school setting, and they have created great working relationships with these three contracted companies. Within the memo, we listed all the contracted vendors that they use and why they work directly with them instead of going out for bids. At the beginning of each school year, they will create a new memo with any contracted companies that they will be using during that school year. Anticipated Completion Date: 4/30/2025

FINDING 2024-004 Finding Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Summary of Finding: Procurement- Small Purchase In fiscal year 2023, the Cooperative had five vendors which fell within the small purchase threshold (between $10,000 and $150,000). The Cooperative did not obtain quotes or competitive proposals, nor was a circumstance met that would have allowed for a noncompetitive procurement for the purchases. The total amount spent in was $292,806. Suspension and Debarment Verification to verify that contractors and subrecipients are not suspended, debarred, or otherwise under a nonprocurement transaction through SAM was not being completed. Three vendors each fiscal year provided goods or services which equaled or exceeded $25,000 were selected for testing. The total amount spent on covered transactions was $266,063 and $142,639 for fiscal years 2023 and 2024. For all six vendors, the Cooperative did not verify the vendors’ suspension and debarment status prior to payment. Contact Person Responsible for Corrective Action: Greg Hunt Contact Phone Number: (219) 362-7056 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Our Special Education Administrative Assistant has already begun checking on SAM for any federal purchases to verify suspension and debarment. She has also been provided with the LaPorte Community School Corporation’s Procurement Policy number po6325 and will adhere to those guidelines for any future purchases. Anticipated Completion Date: January 2025